Project Management: Why Every Leader Should Learn About It

Just as a coach guides a team to victory, strong project management keeps everyone focused and moving toward success.

Managing complex tasks requires careful planning and coordination, whether in business or everyday life. Organizing a big project, like a home renovation or a trip, takes some skills. And if you’ve done it successfully, you’ve probably used some of the same techniques that professional project managers use.

Project management is key for leaders who want their teams to reach business goals. It’s all about effectively managing budgets, timelines, resources, and stakeholders. So, what does project management in business involve? Let’s break it down.

TL;DR

• Project management is applying various skills and activities needed to reach project goals.
• Each project is run dealing with the 3 main constraints – budget, quality, and time.
• You will encounter 3 types of project management – predictive, reactive, and hybrid.
• Some of the most popular project management tools include – Gantt charts, Kanban boards, Timelines, and Workload.

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What is project management?

Project management balances different factors like time, money, and resources to help your team meet its goals. It lets you stay on track and keep things running smoothly, whether launching a product or managing a budget.

This process begins with the first idea of the project and continues until the final goal is delivered. As such, it contains several phases—initiation, planning, execution, and closure—which together form the project life cycle. Each phase requires careful coordination to ensure tasks are completed on time and within budget.

The person overseeing this process is most often referred to as the project manager. While there will be collaborations with other people and delegating tasks, the project manager is the point person for the whole effort. They are responsible for planning, preparing project documentation, assembling and managing the team, reporting on progress, and communicating with the clients and stakeholders.

Project management example

Planning a company event is a four-part process: initiation, planning, execution, and closure.

It starts with defining your goal – think team retreat – and identifying the key players: leadership, HR, and employees. At this stage, you also assess whether your idea is feasible in terms of budget, venue, and date.

Once that’s settled, you start assigning tasks. HR usually sends out invitations. Finance manages the budget. An event coordinator takes care of logistics. You’ll set deadlines for bookings and prep work to ensure everything runs accordingly.

As the event approaches, you’ll confirm the details and make sure everyone knows what to do. It’s also a good time to troubleshoot any potential issues. Finally, you’ll run the event, gather feedback from attendees, and review what worked and what didn’t.

Selecting the right project manager is crucial for success. A qualified manager ensures clear communication and effective risk management and keeps the project on track, directly impacting team morale and project outcomes.

Use the guide below to learn more.

Project constraints and goals

Project managers often face trade-offs between the three key constraints—time, budget, and scope. It is up to the project management and the team to manage these constraints while delivering the set goals and maintaining the quality of the results.

For example, if you run out of time, you may have to invest more money or reduce scope to meet the deadlines. Choosing and managing these constraints is crucial to keep the project on track. Most often, you will have to sacrifice one metric to improve others.

Project goals vary based on the project’s purpose, such as delivering a product, improving efficiency, or boosting revenue. Each goal type—output, outcome, benefit, or strategy—requires a tailored approach to ensure success. Most commonly, they are categorized into the four following types:

• Output – launching a new product.
• Outcome – relocating teams into a new office building.
• Benefit – reduced production costs.
• Strategy – raising the company’s share price by X%.

Your process may differ slightly based on the project goal. However, these differences are not significant enough to be discussed separately and will not be addressed in this post.

3 Types of Project Management

Similarly to goals, there are different project management approaches. This translates into different leading and working styles within the team. No approach fits all with project management, and thus, it is important to try out many and find the option right for you.

The well-known project management approaches can be categorized into 3 types:

1. Predictive approaches

These techniques have one thing in common: They plan out the project in full before it begins and then complete it phase by phase. The best example of this is the waterfall approach, which famously uses Gantt charts to plan and execute projects.

Such approaches are best used for projects with clear outcomes and processes. This means they can be planned out accurately, and then this plan can be implemented without too many surprises or obstacles.

2. Adaptive approaches

Another way of managing projects is the adaptive tactic, which involves planning for shorter intervals, reviewing results, and then planning again. This is also known as Agile project management.

Most teams use frameworks like Scrum and Kanban to implement this. Kanban supports visual work management by displaying tasks on a board, making it easy to see task progress and prioritize work. Their biggest advantage lies in their ability to change and adapt to market changes.

Agile principles make it easier for businesses to be flexible. Breaking down work into smaller tasks lets teams track progress and respond quickly to customer feedback, changing priorities, and unexpected problems. This adaptability helps them stay competitive and capitalize on new opportunities as they come up.

Such an approach will best suit teams where the process is new or unclear and the market circumstances are changing rapidly. An iterative approach will allow us to correct course and experiment at a much faster pace.

3. Hybrid approaches

The last and possibly the largest group of project management approaches are the hybrids. They are less official than the previous two types but much more common as teams try out and adapt parts of different approaches to form their own.

One of the more common hybrid project management practices is mixing Gantt and Kanban. In such cases, Waterfall—a sequential lifecycle model where each phase depends on the completion of the previous one—is used for long-term planning and stakeholder overview, while the team tracks and performs their tasks within an Agile environment.

If you want to explore further, here is a post outlining how to use Gantt charts and Kanban boards together. Discover how hybrid models work.

5 Phases of Project Management

Project management differs from other management techniques as each project has a finite ending. Instead of ongoing indefinitely, projects end after a certain time, and then a new venture is taken on and the project planning process begins again. Project management has clear phases. Each phase helps teams move smoothly from idea to finish. This structure keeps everyone aligned and focused on their goals.

Most projects can be summed up into five planning phases: approval, planning, execution, testing, and completion.

Now, depending on your chosen project management techniques, the order and number of certain phases may differ. For example, if you work in a Waterfall environment, you will have a linear process as listed above. On the other hand, if you work in a Kanban project management environment, you will repeat the planning, execution, and testing phases every few weeks.

While the order and the number of project planning phases differ from one method to another, what is done in each phase stays the same. Thus the explanation below focuses on those actions instead of any particular process order.

1. Approval

• Purpose: Initiate and justify the project.
• Key Actions: Identify the project need, prepare a project charter, present it to stakeholders for approval.
• Example: A company proposes developing new client management software, listing its vision, benefits, risks, and limitations.

The first project planning phase is initiation and approval. A project manager or another company employee must recognize the need for the project and suggest that the company take it on.

To do so, they usually analyze and prepare a project charter that is then presented to the shareholders or decision-makers. The project charter lists the project vision, goals, benefits, risks, and limitations, thus allowing one to make an informed decision about moving forward.

Gathering insights from stakeholder interviews is a key part of defining a project’s scope. These interviews clear up what stakeholders expect, need, and are concerned about early on. The project manager can talk to stakeholders directly. This helps ensure the project charter aligns with their expectations. It also helps avoid problems later on.

For example, if a company identifies a need for a new client management software, the project manager would analyze market demand, define the software’s key features, and outline potential risks such as data security concerns and integration challenges. These insights would be gathered not just through market research but also from stakeholder interviews, which would inform the project charter for stakeholder approval.

If the project is approved, it can move on to the next stage. Otherwise, it can either be reconsidered later or entirely dismissed.

2. Project planning phase

• Purpose: Develop a detailed project plan for execution.
• Key Actions: Gather the team, secure resources, perform risk management, and create a project timeline.
• Example: For a mobile banking app, the manager uses a Gantt chart to map out stages like design, development, and testing.

Next, the project planning phase asks for writing a project plan. Once the project is approved, the project manager must take some time to prepare for its execution. This means gathering the team, securing resources, and getting everything ready.

It’s also the time for risk management. Think about what could go wrong. List potential risks, assess their impact, and decide how to handle them. This way, you’re prepared for surprises and can keep the project on track.

Depending on the methodology, you might use a swimlane diagram or a Gantt chart to map out tasks. If you’re working in Agile, gather user requirements and prioritize them for the first iteration.

For example, when planning the launch of a new mobile banking app, the project manager might use a Gantt chart to outline development stages, including UI/UX design, backend development, security testing, and compliance approval. Meanwhile, an Agile team would define user stories such as “Enable secure two-factor authentication” and prioritize them for the first sprint.

At this stage, the manager usually writes a project plan, defines project objectives, and chooses tools like project management software.

3. Execution

• Purpose: Carry out the planned tasks and deliver the project output.
• Key Actions: Team works on tasks, project manager monitors progress, solves issues, and updates stakeholders.
• Example: The app development team starts designing UI, building backend functionality, and implementing features.

As the project is planned and prepared, the project manager and team can move on to the execution stage. The actual work begins as the team takes on the project tasks and starts producing results.

In this stage, the team acts according to the project plan while the project manager monitors progress, updates the project schedule, solves issues, and reacts to any changes in the market.

This is the project phase where the most value is created, but it also allows for the most mistakes.

Therefore, it is crucial to actively monitor what is happening, correct mistakes, and ensure a successful project.

4. Testing and iterating

• Purpose: Ensure the project output meets quality standards.
• Key Actions: Conduct testing, gather feedback, implement improvements, and maintain quality control.
• Example: The app undergoes security tests, user experience reviews, and adjustments are made based on feedback.

Depending on the team’s project management method, the testing phase could occur at the end of the project or every few weeks during execution.

Either way, it is essential for quality control and should be carried out responsibly. In effective projects, teams involve as many project stakeholders in the testing process as possible to ensure the final result matches all requirements.

In waterfall projects, testing typically happens at the end of the project. However, in some cases, the plan may be revisited to incorporate feedback from testing, ensuring the final product meets quality standards. This allows the implementation of required changes and delivers a quality result.

5. The end

• Purpose: Formally close the project and evaluate its success.
• Key Actions: Wrap up final tasks, complete documentation, present results to stakeholders, and assess project outcomes.
• Example: The project manager delivers the final mobile app to stakeholders, discusses successes and lessons learned.

Lastly, as the project goals are completed or, in more unfortunate cases, as the project deadline or budget is reached, there comes a time for the final stage – the end.

Here, the team wraps up the final tasks and documentation before moving on to a new endeavor. The project manager presents the final project results to the stakeholders and evaluates the project’s success.

It is also an excellent time for a retrospective meeting. The team gathers to discuss what went well, what could have been better, and actionable improvements for future projects. For example, the app development team might note that communication delays affected progress and decide to use more frequent check-ins in the next project.

What does a project manager do?

While some are natural leaders and managers, becoming a great project planner and manager takes years. The role covers many different project manager skills and requirements, which differ from field to field.

This means you could be significant in one industry and still have much to learn in another. Therefore, the best project managers are the ones who always keep learning and looking for new ways to help their teams perform.

Guide to managing remote teams.

What is a PMO (Project Management Office)?

A PMO is essentially a department that oversees project management in a company. It ensures projects align with business goals and helps project managers stay organized, which can be a huge advantage for your organization. In such cases, the PMO helps the managers carry out their responsibilities and supports the visual management efforts.

Setting up a PMO could start with creating a project template that all teams use for consistency. For example, you might implement a standard project kickoff meeting to align goals and timelines with the company’s broader objectives. You could also set up a dashboard to track project progress, so leadership can easily see if everything is on track.

Another practical step might be establishing a resource management system, which would ensure that teams are efficiently allocated and no one is overloaded.

The tools and best practices of project management can be quite different depending on the industry in which they work. However, most project managers carry the same responsibilities as the ones listed below:

1. Identifying the need for a project. 

A project manager’s job begins long before the actual project. In most cases, it is the project manager who looks for new opportunities and identifies a need for a new project.

While they are not the only ones who can do this, knowing their team’s capabilities and business goals helps them seek out more opportunities.

2. Approving new business cases. 

Usually, quite a few people are involved in the decision on which project to take on—shareholders, analysts, team members, etc. However, a project manager plays a central role as it is up to them to present the business case and advocate for the need for a new undertaking.

3. Developing a project plan and then implementing it.

Once the project is given the green light, the project manager has to develop and implement a project plan. This plan usually outlines the project team, deliverables, project schedule, project scope, and other important details that help shape how the project will be executed.

In the project planning phase, it is important to consider what the team will need and what issues they may face as the project begins.

4. Leading the team. 

There is no project without a team; thus, a big part of the project manager’s responsibility is to ensure that they are okay. This includes task coordination, planning, and various motivation techniques to keep up morale.

5. Managing risks and monitoring progress. 

Another big part of the project manager’s responsibilities is monitoring the project’s current status. This means constantly monitoring progress against the initial project plan, solving issues, and eliminating risks to ensure timely delivery.

To track progress and stay on top of things, project managers often use key performance indicators (KPIs). These metrics give you a sense of how well a project is doing and if it’s on track to meet its goals.

Some common KPIs include:

• Task completion rate: This tracks the percentage of tasks you’ve completed compared to what you planned.
• Budget variance: It measures how much you’ve actually spent versus what you budgeted for.
• Schedule variance: This compares your planned timeline to how the project is actually going.
• Risk mitigation success: It tracks how many risks you’ve successfully sidestepped or mitigated.
• Stakeholder satisfaction: This measures how happy your stakeholders are with the project’s progress and what it’s delivering.

6. Managing the budget. 

The project manager is responsible for ensuring that the budget is not exceeded. To keep the budget in line, they must motivate the team, coordinate efforts, and anticipate delays. If necessary, they can negotiate a budget increase with the shareholders.

7. Completing the project once it reaches the end. 

Lastly, the project manager announces the project’s end. Whether it is due to reaching the goal, the deadline, or the budget laid out in the project plan, each project has to end at a certain time, and the project manager closes it up.

Defining Roles and Responsibilities with a RACI Matrix

A RACI matrix clarifies roles and responsibilities by assigning them to tasks. For example, for the e-commerce website project, a project manager could create a RACI matrix for key tasks:

• R (Responsible): The person who performs the task.
• A (Accountable): The person ultimately accountable for the task’s success.
• C (Consulted): The people whose opinions are sought before completing the task.
• I (Informed): The people who need to be kept updated on progress.

The Project Manager gathers the requirements, and the Designer creates mockups. The QA Tester performs user testing to ensure the website meets quality standards. This setup helps avoid confusion about roles and keeps the project running.

Project management benefits

Practical project planning efforts bring quite a few benefits to the company that implements them. The Project Management Institute found that adopting critical chain project management techniques can reduce lead times by 50%, leading to on-time deliveries over 99%. Similarly, Cisco’s use of Agile with SAFe resulted in a 25% reduction in defects and faster product reviews. Both examples show how structured project management practices accelerate delivery and improve quality.

Here is why you should try and uphold your project management standards:

1. Bigger chances for reaching the project goals. 

Implementing effective project planning practices increases the certainty that the project will achieve the desired results. You have more control, predictability, and focus to achieve what was described initially.

2. Effective use of resources. 

Project management practices, especially employing a project manager, allow you to ensure the project team is scheduled and used most effectively. By knowing the full situation, the manager can shift the project plan and get the team working efficiently.

3. Improved project scope and quantity of work. 

As the project manager manages all project processes, the team members can focus on what they do best—the actual work. This means they will be able to do more and with better quality than when they were distracted by management tasks and scope creep.

4. Happy project stakeholders. 

The project manager is a great buffer between the team and the project stakeholders. By knowing both sides of the equation, they can bridge the gap and ensure the flow of communication throughout the project. This results in happier stakeholders and a more relaxed team that can focus on executing the project plans.

5. Employee growth. 

Lastly, project planning practices allow employees to grow. Managers can find new ways to schedule projects and structure work breakdowns, while the project team has more time to improve their work, which results in growth all around.

How important is project management?

In 2024, project management is more about embracing the latest technology than ever. AI-powered tools like ClickUp, Monday, or Teamhood can help project managers. They make communication a breeze, let them anticipate project outcomes, and make decisions based on cold, hard facts. What’s behind AI’s growing impact on the role of project managers?

Artificial Intelligence (AI) and Automation: The rise of smart project management

Integrating Artificial Intelligence (AI) and automation in 2024 has revolutionized project management. AI-powered tools and algorithms streamline repetitive tasks, optimize resource allocation, and improve decision-making processes. These technologies enable teams to analyze vast amounts of data, identify patterns, and make data-driven predictions.

AI and automation are transforming the way we manage projects. Now, embracing these technologies is more important than ever to free up time for important tasks, such as strategic planning, stakeholder engagement, and fostering innovation within your team.

Advanced resource and project management software: Navigating complexity with ease

In 2023, project managers have access to advanced resource and project management software beyond basic spreadsheets and manual tracking. Sophisticated platforms such as Teamhood integrate various aspects of project management, including resource allocation, time tracking, financial management, and reporting. With real-time data visibility and interactive dashboards, project managers can make informed decisions, identify bottlenecks, and ensure optimal resource utilization. Embracing such software empowers project managers to navigate the complexities of modern projects with ease and precision.

Learn more with these project management dashboard examples and tips on choosing on-premise project management software.

Demand for emotionally intelligent leaders: Building stronger connections

Top-notch project managers know it’s not just about getting tasks done—it’s about building strong team bonds, too. Emotional intelligence is key. It helps them motivate their team and resolve conflicts. They also build strong relationships, which leads to smoother projects.

Today’s rapid changes in the project management landscape demand emotionally intelligent leaders. Emotionally intelligent leaders can understand and manage their emotions and those of their team members. As a leader, you should foster an inclusive and supportive work environment where individuals feel valued, heard, and motivated to perform at their best. Emotionally intelligent leaders excel in communication, empathy, and conflict resolution, creating strong connections with their teams and stakeholders. Conflicts are inevitable, but handling them early with clear communication can turn them into opportunities for alignment.

To keep the team motivated, celebrate small wins, provide regular feedback, and remind them of the bigger picture. Giving team members ownership of their roles keeps them engaged and invested.

Growing attention to mental health: Nurturing well-being for success

Recognizing the impact of mental health on project success, organizations in 2023 are increasingly prioritizing the well-being of their project teams.

Project managers play a crucial role in nurturing the well-being of team members. Promoting a healthy work-life balance, supporting stress management, and fostering a positive work environment all contribute to the end goal—attention to your teammates.
This, in turn, leads to improved morale, higher productivity, and better project outcomes. It highly contributes to the overall success of projects and the organization.

Project management tools

Whether managing remote teams or handling complex projects, here are some tools to streamline your workflow.

Task management system

Whether it is a list or a Kanban board, all managers need a way to note down the project plans and give them descriptions, due dates, and assignments. Project tools like Teamhood allow this to be done in a visual task board, making tracking progress easy for the manager and the team. Managing progress and risks in remote teams is a whole lot easier with async and sync tools. These tools help teams stay connected and work together effectively, even across different time zones.

Async tools, such as project management software, email, and shared documents, help team members. They can update progress, share feedback, and communicate anytime. This way, not everyone needs to be online at once. This flexibility is essential for teams in different time zones, allowing work to keep going without having to wait for a meeting.

Sync tools, such as video conferencing and live chat, help teams connect in real-time. They allow for quick decisions and issue resolution. Plus, they ensure everyone stays informed.

Workload management tools

Managers use workload management to ensure that no one on the team is overworked or underworked. It helps monitor the workload of all team members and reschedule assignments effectively. By noting team availability and tracking the current project plans, the project manager can find the best way to utilize all resources.

Reporting

Various reports are a great help in quickly checking how well the team is doing and which project plans should be prioritized. There are a variety of such reports to choose from, and each project manager picks the ones that are most relevant to their definition of a successful project.

Time tracking

Time tracking allows managers to gain more insight into the project’s success and execution. They can better understand the length of each task, how it relates to the project plan, and what effort they should plan for in the future.

Gantt chart

The Gantt chart is one of the oldest project management solutions. It allows the layout of project phases in a timeline view, making it easy to see the project’s start and end dates at a glance. In modern timeline management tools, managers can also divide those stages into tasks and subtasks, define task dependencies, and track progress visually. This clear, time-based layout helps ensure that everyone understands the project schedule and stays aligned throughout execution. Gantt charts are usually used to create a project plan and then monitor how the team executes it.

For example, in a construction project, a Gantt chart can display tasks like “Procurement,” “Foundation Materials Delivery,” “Materials Check,” “Logistics Site Setup,” and “Materials Distribution.” Managers can see when each task starts, how long it should take, and which tasks depend on one another. If “Foundation Materials Delivery” is delayed, the chart immediately shows how it impacts “Materials Check” and “Logistics Site Setup,” enabling the team to adjust timelines and maintain progress.

Compare Kanban and Gantt visual workflows.

Portfolio

Portfolio management is great for managers working on several projects in the same company. It allows them to see the big picture and create project plans for specific teams or products. Seeing the whole picture makes it easier to prioritize which project plan is the most important and should be focused on at any moment.

You can find these tools and more in our project management solution Teamhood!

Additional resources:

• The 2024 guide to manager salaries
• Project management techniques
• Project management dashboard examples
• Software development project management