Project Profitability: Managing smaller projects

By Howard Birnberg

 Effectively managing smaller projects is extremely challenging for many design firms. This issue impacts large firms needing to fit the management of smaller projects into their existing large-project processes. It also impacts others such as civil engineers who handle a large volume of smaller projects on a daily basis.

One large Midwest engineering firm estimates that 90 percent of its work fits into the small project mold. This is particularly challenging when considering it generates nearly $30 million in revenue annually. Structures, processes, organization, and information reporting must all be designed around the smaller project.

Five-step approach

While not a perfect solution to the challenges of managing smaller projects, the following can be of great help.

Standardize — As much as feasible, firms should seek to standardize their processes, develop templates to manage the project scope of services, create small-project checklists, and develop quick checking and quality review procedures. MBA-type processes such as project charters, plans, and schedules should be abbreviated or discarded because the project schedule and budget will not support these activities.

Train — Firms with a large number of small projects should train much of their technical staff in the skills of project management. A particular focus should be on the importance of communications with the client and others involved in the project, cross training of all staff, and establishing a mentoring program. Periodically, an “all-hands” sharing meeting regarding lessons learned can help everyone learn from experience and improve performance.

Support — This step requires a number of actions:

Define what is expected of project managers, particularly on smaller projects. Development of a project management manual can be of great help in this process. Project management manuals are a fundamental tool in defining how the project management system operates     in your firm. Typically, the manual is used as a reference document by experienced project managers, as a training tool for new or less experienced managers, and as an orientation tool for new staff members at the middle and senior levels of the firm. Often, firms provide copies of all or part of their manual to their clients in an effort to inform them of the firm’s procedures and methods of operation. This can clarify critical issues at the early stage of a project

Provide timely and accurate project information. As small projects may only last a few days, information on project expenses and labor must be available on demand. Obviously, time sheets must be posted to project records on a daily basis to be of any use.

Develop quick and easy-to-use template forms to allow documentation and communication with minimal effort. Individuals handling small projects have neither the time nor the inclination to complete complicated and lengthy forms and documents.

Consider developing the role of project administrators to support project managers handling smaller projects. Project administrators are typically not technically trained, but have a reasonable understanding of project needs and the design and construction process. These individuals support the efforts of project managers by relieving them of some of the administrative burdens of projects. Most project administrators work with multiple managers unless one has a particularly heavy workload.

Control scope creep and change management — Often, the individual assigned to manage smaller projects is primarily focused on the technical aspects of the job. As a result, they may lose sight that smaller projects also have a scope of services as requested by the client, a budget to complete the work, and a schedule for completion (both design and construction). Of particular concern is the issue of scope creep. Performing work not required under an agreement or requested/approved by a client can quickly turn smaller projects into money losers. A firm highly dependent on these small jobs can be “nickeled and dimed” into insolvency. Small projects require tight controls.

Focus — Don’t become so fixated on the technical aspects of the smaller project that you lose sight of what the project requires. Do what the client needs, not what you would like to do if you had a greater budget and longer time frame.

Summary

Managing smaller projects often requires as much project management attention as do the larger jobs — they just lack the time and budget. While no job is easy, the five steps outlined in this article can be of great help to those staff members who face the challenge of managing smaller projects.

Note: One technique not explored here is the use of a Small Projects Group established within a larger firm. This subject will be discussed in a future article.

Howard Birnberg is executive director of the Association for Project Managers (https://www.apminfo.com). He may be reached at 312-664-2300 or hbirnberg@gmail.com.