In my experience the time spent on a project performing project management activities is anywhere from 10% to 30%, with my projects averaging 15% give or take a little. This figure is representative of time spent, not total cost. If there are large purchase costs as part of the project, that would drive the percentage of cost of project management down a bit. Saving Changes...
Would the PM function be handled by a team member or a separate PM who's sole job was PM? Would the pm functions be occuring within a project office environment, a program management environment or sort of ad-hoc? I think these factors (the set up of the PM's job, the formality and structure of the function of pm) will influence cost.
For the purpose of a survey I would suggest we tie the % of PM time to the overall project size. Certainly the smaller the project, the greater that percentage. Saving Changes...
Costs vary from 10 to 20 per cent of the total project budget, depending on the size and complexity projects under management. Also, reporting requirements and methodologies such as object-oriented development or Capability Maturity Model tend to drive PM costs UP!!! Saving Changes...
John ZacharProduct Dev Manager| Association for Project Management (APM)Brackley,, Northamptonshire, United Kingdom
I get so frustrated when costs are discussed, and the other side of the coin seems to be ignored.
I agree with most everything said so far, total costs say somewhere between 15% and 30% depending on the situation.
Now that a number has been established, some financial whiz kids, somewhere, will inevitably try to drive that figure down; afterall, here is another attempt to implement change on the cheap.
I think a much better question might be, what will be the cost if the project fails? How much more will the re-work cost if the PM is done less expensively? What will it cost if we get it completely wrong?
Our research suggests that about 40% of all spend on projects in the 'western world' is spent on re-work. That of course varies, but also suggests there is a great deal of improvment that can be made.
I have a great deal of fear for those that don't understand the implementation of change, and try to do it to a recipie, especially as a percentage of costs. That has to be where the question came from! Saving Changes...
Does anyone know of a model for determining the amount of project management needed on a project? Something that would account for Team size, Risk, complexity, duration, and location? On a small sized project, you probably don't need a project manager full time. 10%, 15%, 20% of the cost of the project are estimates that I've seen, but does anyone have a model for determining what is appropriate in advance? Saving Changes...
I was reading through the discussion topic and one of the items that caught my attention was the reference to the 40% of all spend on projects being re-work.
Can you elaborate on how you arrived to that conclusion? Or, where did you find that data? We are going through a Project Manangement Implementation and that information would be very helpful.
If one claims that PM activities add incremental cost to a project, which activities can be deleted to the extent that resources are not needed, and therefore can reduce the overall cost of a project?
Are there any PM activities that are not inherent in the planning, promising, and performing the project itself?
In an organization whose purpose is to deliver multiple projects with a relatively finite pool of shared resources (such as IT shops, R&D, product development, etc.), and which wants to survive as an organization, is there any real people cost than the value of the projects not done?
If you succeed in achieving more valuable throughput, no one will question costs.
