How to Start a Project Management Company
Project management companies help individuals and organizations handle their projects from start to finish. The planning, staffing, budgeting, equipment acquisition for, and execution of the project, are a project management company’s responsibilities to their clients. Although many project management companies are established, and some are billion-dollar empires, you can start yours with a few practical steps.
In this post, you will also unlock the secrets of having a successful project management company, as well as the qualities you need to be ready for what lies ahead in the industry.
The benefits
Your options are unlimited
There are plenty of options to choose from in the project management industry, with many projects to be done in various fields. Project management companies are needed in every area, and regardless of what your academic background is or where you’ve got work experience, you have someone that’s in need of your expertise.
Any sector, organization, or individual can have a project they need to execute expertly. When a company, for example, needs to construct a building, the building contract will be awarded to a project manager or a project management firm. This individual or firm will oversee the whole process until completion as they are experts in construction. Weddings are also contracted to project managers to plan- endless opportunities await you in this sector.
It is lucrative
Project management is a lucrative business idea that can fetch a lot of money for the owner. The average project manager makes more than $100,000. The magnitude of the project will determine how much the project management company will earn. Project management companies get paid based on different factors. Their experience in the business of overseeing projects for clients will be used to measure their expertise even before they start working. Also, the location of the business and project will count as places with a high cost of living will be more expensive to get materials, workforce, and other necessities for the project.
The challenges
Working overtime
Running a typical project management company is not a nine-to-five job. There can be office hours for visitors and clients at your office but once the project kicks off, expect to spend more hours working than you anticipated. Due to the nature of some projects where the subsequent task cannot be done until the ongoing one ends, the waiting would make you put other plans on hold.
The expected duration of a project will sometimes be exceeded, and this would make your clients demand that the job be completed as soon as possible. In trying to finish up quickly, you would need to put in extra hours to get the project completed. This attempt would see you spend days and nights working, along with your team. The project’s outcome can also determine if you’ll be spending longer because if the client, for some reason, is not satisfied with some aspects of the completed project, they might ask you to redo them.
Inconvenience
This aspect of the trade is one of the areas that discourage those who intend to start a project management company. It is not always convenient the moment you take on a project. Just as working overtime is a discouraging factor, so is the nature of some projects. Some projects have tight budgets and this will make you cut costs. The location of some projects can be unattractive and uncomfortable to work.
Sometimes, project managers sleep in trailers for months just to get a project done. The road networks to some sites are terrible; with some areas having weather conditions that don’t suit you. While some projects will take you to penthouses, others could take you where you’ll have no option but to sleep on the floor. For some projects, you might need to travel to places where you don’t like their food, so eating also becomes a problem for you, and you might end up eating canned food most of the time.
Traits of a successful project management company owner
Although project management is a lucrative market, to succeed in the business, you must possess some attributes that will help you withstand the challenges you will likely face. These traits are not meant to discourage you, even if you don’t have them all, you can always work on them.
Resourcefulness
Many unforeseen events happen even when a project was well-planned. There are things you can control and things outside your jurisdiction. You will have faith that the person you have working with you will deliver, and then you’ll oversee the whole process. Apart from those you have hired to work for you, there’ll be others who will be needed by you to do other things like supplying materials for the project. And when the project kicks-off, you might need to get more supplies while everyone else is working, all these will depend on others, not you. And when, for instance, materials don’t arrive on time, or at all, what happens? When a task isn’t done right no matter how hard the workers try, what solution do you proffer? Problems will arise, but if you’re able to find a solution at once, it won’t delay your project.
Pay attention
No matter what you do- how quickly, or how well you finish an assignment -if it’s not exactly what your client asked you to do, you’ve done nothing. Before any project is awarded to your project management firm, your client would have given you a detailed description of what they want you to do for them. You must be attentive at all times and ask questions if there’s something you don’t understand- that’s what an attentive person would do.
Even after you must have started working on the project, you should refer back to where you documented details of the project as described by the client to keep you in line. And if need be, ask your client to be sure you’re moving in the right direction.
Organized
Projects can be big, some can be complex, and the biggest ones often need a large workforce. Your project management company will be awarded big projects which can take your business to greater heights, and the route to completion will not be straightforward. It takes an organized person to handle a project, especially the big ones. There will be many activities to keep track of, and there will be other people you’ll need to keep tabs on who is partially involved in the project. Some projects will see you make payments for materials and other things almost on a daily basis, while some expenses can come up out of nowhere. Without adequate organizational skills, you won’t be able to keep records of these activities, and monies spent. To aid your quest for organizational exploits, you need to have project management tools, especially software, to help track the activities of those on and off the project site.
Time management
In project management, time is not your friend. Time flies whether you’re having fun on the project or not, and when the deadline is near, that’s when it’s worse. Apart from short duration which some clients might expect that their projects be completed, some projects take longer than expected due to some uncontrollable factors.
Pressure builds up when projects are not completed on time and that could have a negative effect on your health. Your ability to make the best use of your time will save you a lot of trouble. The longer a project takes, the less time a project management company has to assess it before deeming it completed.
A good time manager will be able to buy his or her team time even before they start the project. The best project managers consult their team members to ask them how much time it would take to finish their tasks and then work towards it. And as the project is going on, you’ll make sure every team member has everything they need so that they can focus on the job completely.
The ability to work well under pressure
There will always be a time when projects will not turn out the way they were meant to be. Some projects will not be satisfactory and you might be running out of time. The business comes with a lot of pressure once in a while, especially when it’s worth hundreds of millions, or more, and you have to deliver.
If you let the pressure get to you, you might never get the job done and you would have wasted money, time, and lots of resources. The way you handle pressure will determine how well you coordinate the project. If you overreact as a result of pressure, your team members might be affected by it, and that can affect the outcome of their tasks. Someone who can be calm in the midst of storms, and take pressure away from members of the team, will be the perfect person to start a project management company.
How Can You Start Your Project Management Company?
Be educated in the project management line
Unlike some businesses whose owners do not require a degree or formal education to start, you must have at least a degree in the project management field. Having a degree or being formally educated is standard practice in the field. Some universities make room for project management to feature as a major where interested students can apply. Some of the best universities that offer a Master’s degree in project management include:
- Georgetown University, Washington DC
- Stevens Institutes of Technology, New Jersey
- Boston University, Boston
- University of Denver, Colorado
Apart from taking Master’s classes in universities and colleges, there are many other management institutes that offer project management courses. These project management courses are certified by the governing bodies overseeing the affairs of the industry. Some of the most coveted project management certifications are:
- CompTIA Project +
- PRINCE2 Foundation
- PRINCE2 Practitioner
- Project Management in IT Security (PMITS)
- Project Management Professional (PMP)
- Certified Project Manager (CPM)
Choose an area of specialization
The fastest way to fail in project management is to take on every project that’s up for grabs. You can not- and should not -aim to start a project management firm that can do everything. If you want to succeed in this business, the next thing you must do after getting an education is choosing a niche. It pays to be a specialist in something than be average in a lot of areas. The project management industry can be unforgiving and words spread like wildfire, and the outcome of your endeavor will be made public.
In choosing a field you wish to specialize in, the easiest way to look is in the direction you are versed in. What you are familiar with should take preeminence when selecting a niche. Start with what you studied or the field in which you have work experience. Once you figure that out, proceed to learn more about it.
You don’t have a project management company until it’s registered- it’s unlawful. Besides its meaning breaking the law, no reputable or big client would want to take a chance on your firm. Your business plan, company registration details, and tax details are some of the things your potential client would want to see before awarding you a contract. Create a solid business plan, get the necessary licensing your firm needs, register your business, and you’re fit to start operations.
Get the tools you need
First thing is to secure a location for your office. There are few cases where a project management company can be situated at the owner’s residence, but that’s if the nature of small projects they get are for people in their vicinity. Securing an ideal location for your office is essential as it will bring you closer to your clients.
After securing an office in a suitable location, get the manpower you need. Your workforce will be divided into two; the ones who will do clerical activities, while the other is the ones that will be at the project’s location. The people you select to do the job must be competent and also possess the same attributes you need to run the company successfully.
The tools for project management are crucial to the everyday operations in the company. Project management companies use different software and resources to oversee the activities that go on on the job. Some of the essential software include;
- Scoro: it tracks project progress and stores all information in one location.
- Workzone: used to assign tasks, give permission to access certain files, and incorporates every member of the team.
- Cage: project managers use it to create projects, manage projects, assign projects, and improve collaboration within the team with discussion platform.
- Skype: used to make conference calls with clients, colleagues
- Excel: it helps with project documentation on spreadsheets
- Kanban: used to keep tabs on project activities and view project progress
Create your network
In the project management industry, the biggest projects are usually awarded to familiar faces, even though such practices don’t seem fair. To get the best offers for your company, you must know people in key offices or at least be close to those who know such people. Having these sorts of connections doesn’t come easy and it might take time.
Start making those contacts now because as soon as you launch your company, there will be extra pressure on you to get projects in for your business to stay afloat. Whether you’re currently working in a project management firm or not, use the little opportunity you have to get closer to the “movers and shakers” in the industry. Ask to go to dinners and fundraisers to get closer to these people. There are those who have joined clubs they hate only because they want to get closer to those who call the shots. Apart from top clients, you should be acquainted with the contractors and other potential affiliate companies that you’ll need for future projects.
Tips for Carrying Out Successful Projects
In running a project management firm or heading a team, there are some things you can do to ensure that your project is carried out successfully. These tips will keep you in business for a long time.
Get the best out of your team
You are only as good as the people who represent you. Your success lies heavily on the people you hire to carry out the project and if they do well, it reflects on you. There will be days when there won’t be any need for motivation, but on some days, your workers will need all the moral support they can get. You must get the best out of your team if you want to execute successful projects.
Make sure the experts are in a position to cover for their less-skilled counterparts. The weather on some days might be harsh, while an occurrence could dampen the mood; it’s your duty to get them back to full concentration. Sometimes, a night out with the team at the close of business day would be the best way to bond with your workers. It’s not only compensations you need to get your workforce to focus on the project, but also support and additional training.
Be prepared to work extra hours
Since one of the drawbacks of project management is the extra hours you’ll be working, you must be prepared for it. It would be better to have your mind made up and possibly cancel your schedule for the duration of the project. There will be personal issues to deal with as well as other important matters outside the project but you’ll have to put them aside. While this can be a problem for some people, with proper planning, you’ll be able to manage the situation. Some projects will see you spend days and nights at the office, while others will take you out of town completely. Depending on how well you handle it, working long hours or months non-stop, will not be a problem.
Understand the project
Without a good understanding of the project you’re awarded, you might end up doing the wrong thing. Doing the opposite of what you were asked to do could end up in your client replacing you with someone else. In addition, you could lose credibility and get a bad reputation in the industry. And depending on the nature of your agreement with your client, you could end up incurring a loss.
The first thing about understanding a project is to know the field. If it’s a building project, you would be expected to have a profound knowledge of building and construction practices. With a background in a particular field and more information gathered on the project in question, you’ll do the right thing.
Make a plan for the project
Draw a map of how the project will be executed before you begin. This plan is what you will refer to as the project goes on. Document every process from start to finish, including the materials that will be needed to carry out the job, and make sure to include the number of personnel that will be enough to do the job.
With a proper plan in place, every process will be simpler, as you would have made provisions for different events. The plan you make will be approved by the client before you start and you will need the input of your team members to make this blueprint.
Make a budget
A lot could go wrong if your spending is not controlled. In some cases, you’ll have to spend on something you never envisaged, while sometimes, you’ll spend frequently. The spending in many cases can seem insignificant until you sum up what you’ve spent. Without a budget, there will be uncontrolled spending, and you might spend on materials and equipment rentals, while the workers you hire might be overpaid.
Your budget should start with the cost of purchasing the necessary materials for the project. After that, you should make an estimate of what the material suppliers and workers will earn. Other expenses like feeding, transportation cost, and miscellaneous spending will be in the budget.
Conclusion
The caliber of people you know in the business will give you a big chance of landing the best projects. Go out more, broaden your circle, and establish great relationships with every business in the industry. Keep selling your company, and with the right people behind you, success will come.