Why Data Drives Decision-Making Processes in Project Management
“Let the dataset change your mindset,” a quote by renowned statistician Hans Rosling is one that project managers (PMs) should take to heart. Gone are the days of relying solely on intuition and gut as we usher in the information revolution in all aspects of work.
In particular, the most common causes of project failure — scope creep, poor stakeholder management, insufficient monitoring — could all be easily resolved if data were properly embraced by decision-makers.
However, this is not to say that intuition is redundant. The point is, it should instead be used in tandem with data. When properly utilized, data can support the decision-making process in project management by grounding decisions in objective reality as opposed to wishful thinking.
Five Reasons Why Data Is King
A data-driven approach for decision-making can help PMs during all phases of a project’s life cycle, from planning to monitoring.
Accurate forecasts and insightful analyses of past work are some common, key benefits. Here’s a breakdown of how data can transform your experience as a PM.
Reason #1: Identify Warning Signs
By incorporating data analysis, PMs can not only stay in tune with ongoing and past work but also keep an eye out for the future. Of course, this isn’t to say that you’ll become Nostradamus!
Instead, PMs will be in a better position to be alerted of any early signs of slippages (e.g., running over budget or failing to meet deadlines) and be able to resolve these issues early on. For instance, if some tasks aren’t aligned with key metrics such as the cost performance index (CPI), you’ll be able to quickly take the necessary action.
This is opposed to simply reacting as problems emerge, which is in itself a problem endemic to poor management skills.
Reason #2: Manage Stakeholders
Stakeholders, much like in-laws, aren’t always the easiest bunch to please. They’re often invested in the outcomes of your project to the extent that you might find them breathing down your neck!
Thankfully, data in this context can help satiate their appetite. Specifically, data that relates directly to the progress of your project. You can incorporate this data into detailed reports to then share with your stakeholders. This will inform them of the ins and outs of your project while keeping expectations realistic.
Sharing data, however, is an art in itself. So, ensure you first understand what your stakeholders want, choose the right medium (e.g., long-form reports and slide decks), and be prepared to take their feedback into account for future reports.
Reason #3: Understand Your Team
The data you collect and analyze doesn’t just have to be about your stakeholders and customers. It can be about factors much closer to home: your own team. Sports teams do this all the time to boost performance, so why shouldn’t PMs?
By gathering data about your team, you can better understand their experiences, performance, and skills. You may observe that several team members may be struggling with their deliverables on certain dates of the year. You might even discover that some are performing better than others by a long shot.
With this information in hand, not only can you better assign work and improve project plans, but you can also gain a better understanding of how money spent on employees is being used.
Reason #4: Optimize Processes
In addition to identifying your top performers, data can also shed light on areas that are inefficient and are negatively affecting your bottom line. Inefficiency ruins entire projects by wasting time, talent, and resources, so addressing this is crucial.
For example, data could reveal that a majority of resources are being spent on a branding campaign that isn’t generating any leads. With data in hand, you can either choose to further investigate why performance is struggling or choose to redistribute resources to other ventures that can obtain a better return on investment (ROI).
By addressing this, workflow processes can be better optimized and resources better spent, leading to more efficient work and higher quality results.
Reason #5: Visualize Data
Taking advantage of data by visualizing it can also help offer a fresh, organized perspective to projects that can benefit the decision-making process.
While lengthy, number-filled spreadsheets have their time and place (e.g., accounting reports), they aren’t always the best when it comes to striking inspiration or capturing attention. By visualizing your datasets into something like a line graph, infographic, or even scatter plot, you might find new connections and relations that would otherwise be missed.
Data presented this way will also make it easier for fellow team members and stakeholders to understand, keeping everyone on the same page.
Let Your Mindset Change Your Toolset
A data-driven approach isn’t just about its benefits for the decision-making process in project management. It’s an entire mindset that should be wholly adopted by PMs, a mindset that’s projected to be more relevant than ever as we enter 2022.
But simply accepting this isn’t enough. You’ll need the right tools and guides to support your foray into data analytics. For instance, Ricksoft offers a wide range of project management apps that are fully capable of enabling PMs to incorporate analytics into their projects.
Do you have any insights or experiences with data? Share them with us down below in the comments!
