When a company decides to embark on a project, one of the first things team leaders must do is create a project plan. Sounds simple, right?
Actually, developing a strong project plan can be quick and easy, but it can also be a complex and drawn-out process. It really depends on the nature of the project. Either way, you can’t overstate the importance of project planning.
Project planning isn’t just another stage of project management. It’s one of the most critical stages of the whole process. Let’s see exactly why project planning is so important — not just for the project, but for the entire company and its staff, too.
1. It boosts project performance and success rates
Unfortunately, the project failure rate for most companies is 70 percent. Achieving a project’s objectives is often not as easy as it seems.
There are a number of reasons why projects fail. For example, 38 percent of companies say the main reason for failure is that team members are confused about their individual roles and responsibilities. Thirty-seven percent of projects fail because leaders don’t define project objectives and milestones clearly. When team leads don’t effectively manage requirements, 47 percent of projects fail to hit their targets.
Project planning involves comprehensive mapping and organizing of project goals, tasks, schedules, and resources before anyone assigns roles for the project and the team begins to execute the plan. You can avoid almost all of the problems that lead to project failure with proper project planning.
2. It saves money
Failed projects are expensive. Even when a company is successful in completing a project, they can still use up a lot of unnecessary, extra budget.
A poorly planned project can easily run into delays, unexpected glitches, and scope creep. Scope creep is when a project gradually grows in size (and cost) due to unforeseen circumstances or changes.
Project planning provides structure and foresight for the execution stage, helping to eliminate wasteful activities and patterns. This is why companies that stick to solid project management practices waste a lot less money than companies that don’t — an impressive 28 times less, in fact.
3. It improves team communication
Good communication is essential for smooth project execution, and this applies to projects of every size and type. Even two collaborators must communicate well to make sure they complete project tasks on time.
When a project involves multiple employees or teams, outsourced suppliers, and perhaps even staff members in other locations or time zones, then planning how project leads and team members will manage communications becomes vital.
A project plan takes into consideration the team’s communication needs and pinpoints the most effective channels to keep collaborators connected — such as email, chat, virtual meetings, shared documents, and more.
4. It ensures the best use of resources
One of the key components of project planning is resource planning. Every project is based on resource use, including staffing, equipment, budget, office space, and time. Without proper planning, it’s nearly impossible to make sure an organization allocates and uses resources in the most cost-effective and appropriate way.
Different project tasks often compete for limited resources, so project planners must make decisions in advance about how best to assign those resources. This entails a cost-benefit analysis for each project task so that planners don’t simply allocate resources haphazardly but do it with purpose, based on smart forecasts and with the project’s goals and key performance indicators (KPIs) in mind.
5. It makes it easy to track project goals and outcomes
Another key part of the project planning process is defining the project’s goals and objectives. Clearly defined and specific project goals are easier for team leads to translate into quantitative measures of success.
For example, a company is planning the launch of a new product. One of the project objectives is to generate 1,000 sales in the first two months. Team leads monitor this specific, measurable goal over the course of the project, and they can adapt project execution according to the tracking results. So, if sales by the end of the first month are weak, the team can reallocate resources to boost marketing activities during the next month.
When the project planning stage includes detailed mapping of KPIs, it’s much easier to gauge the project’s true performance over time — and decide how to adjust the execution to reach those goals.
6. It helps keep all collaborators aligned
Teamwork is a critical factor in any group activity — especially in project management.
Good teamwork exists only when all collaborators know their roles and responsibilities, how their part fits in with the whole, what impact their actions have on other team members’ productivity, and what expectations project leads have for them as individuals and as a team.
A solid project plan provides an official reference point for all collaborators. That way, everyone is in alignment and up to date about tasks, timelines, expectations, and workflow. When you use project management software to create a project plan, it’s even easier for all collaborators to access and view the entire plan at any time — and even contribute their opinions and expertise to the planning phase.
7. It improves employee retention
Project planning not only benefits the project’s performance and outcome but also plays a role in employee retention. Employees are eight times more likely to remain with their employer if they believe their managers are assisting them with workload management. That helps them feel more connected to their work, and when they feel connected, they are 87 percent less likely to leave their position.
Involving employees in project planning encourages them to contribute their perspective and skill, rather than simply telling them what they need to do. This ensures more effective execution and makes team members feel like a valued part of the company.
The importance of project planning goes way beyond the project itself. It has a direct impact on how employees feel about their workplace — and whether or not they leave or stay.
Planning drives performance
Projects aren’t separate from the daily operations of your company. They have a big impact on the organization as a whole. When done properly, project management saves resources, reduces costs, improves company culture, and improves employee morale. And good project management always starts with project planning. If your project planning phase is focused and precise, you’ll reap the rewards with project success.