If you’re running a project in a professional services company like a marketing agency, software studio or a team of consultants, you definitely have to understand the fundamentals of managing project time and budget control. Not to mention, you also need to make sure your team performs on schedule. Of course, there are instances when you need to put in some additional hours to finish the project on a certain deadline. But are you sure that this project was profitable? Let’s dive in.
Software, marketing or consultancy projects can take from weeks to months or even years. Usually, with the huge timespan, both the team and project manager can get caught up in their daily mundane tasks and regular work stuff. The manager is quite often on the frontlines with the client giving them regular updates and discussing any urgent matters that might come up. The day-to-day routine (or, sometimes struggles and challenges) can distract PMs and teams from the essentials when it comes to the business of professional services. One of which is whether your current project will end up as a profitable project.
If you want to optimize your workflow and you are thinking about implementing time tracking, read our article about ROI time tracking.
Making sure that a project is turning a profit is quite a struggle. So, what sort of processes and actions you need to implement to minimize any losses?
Yes! Just keep on reading ⬇️
1. Know what are the project’s goals
Sounds easy, but it isn’t. Goals change, especially in tech. So make sure you’re on the same page with the client. While partnerships over formalities is a good approach, if you agree on paper, then it’s a tangible thing.
2. Avoid unrealistic estimates – a killer for profitable projects
I know, nobody has ever precisely estimated a project and matched it in the real world. It doesn’t, however, mean that you should strive for precision. While providing over-optimistic timelines might sometimes be a good short term sales tactic, it doesn’t pay off in the long run.
Pro tip: why not estimate projects on historical data of similar work? Just use a simple time tracking app that integrates with your Asana, Trello, etc. to collect valuable data and turn them into measurable forecasts rather than….
…wishful thinking.??♂️
3. Know the variables – what can go wrong?
Anticipate something going wrong. It doesn’t mean you need to become a cynical, pessimistic version of a project manager (which team member would enjoy that?), but treat it as a solid dose of realism. This is the way the world works. If you anticipate obstacles, you’ll be better prepared. Additionally, you’ve built the foundation for becoming a successful PM.
What can go wrong:
- team members quit on short notice
- the client wants to change the previously received feature (and uses strongarming tactics – hint: don’t budge!)
- The team has problems with finishing parts of the work
- The hired freelancer didn’t deliver on time
If you write down all of the things that can go run within a project in your industry you’ll have the advantage of preparing beforehand. Prepare!
4. Tracking billable hours – a must-have for project profitability
No, it sure does not mean MANUALLY FILLING OUT TIMESHEETS, are you serious?
Thanks to so many apps now that allow you tracking time, you can harness the technology to your favor and start properly measuring the time spent by your team on the whole project, a certain task or subtask. What’s even better, apps like TimeCamp allow you to not only integrate your favorite project management software but also assign different hourly rates to your team members (have a team of devs where seniority differs?). Now you’re just one click away from a precise, automatically generated invoice.
👉Find out more about calculating the exact employee cost.
This is the next step to take on your patch to a profitable project. Sounds too good to be true? Set up a free trial and find out for yourself!
Let us know your thoughts in the comments. What were your biggest struggles as a PM?