Jan 27, 2016

How Many Projects Per PM? It Depends.

Posted by Jeannette Cabanis-Brewin in Project & Program Management, Demand Management, Human Capital, Project Management Office (PMO), Project Management Research | 4 Comments

Practical questions of PM practice drive our research program.

Last week, one of our consultants came to us with a question from a client: "What is the ideal or standard number of projects per project manager?"

Questions like this are the heart of our research program. We aren’t academics, and don’t aspire to be. PM Solutions Research was established to find the answers to the practical questions that face project management leaders every day. The beauty of the research studies – 15 years of them, and counting – is that revisiting the data with fresh questions allows us to slice and dice the data in new ways. Questions from clients also tell us what people need to know and help us frame question in future studies. (So, keep those questions coming!)

The question of “project manager load” had one simple, obvious source for an answer in our 2014 State of the PMO study: just divide the average number of projects per year by the number of project managers. It gets interesting when you compare the number of projects handled by each project manager in the “high performing companies” identified by the study to the same metric in the low performing companies. Take a look:

 

 

 

 

 

 

Not only are project managers in high-performing companies handling fewer projects … but the projects have, it seems, been “chunked” into smaller pieces, which is what the budget per project seems to indicate. We know from other research such as the CHAOS studies, that is a key solution to project failure.

A conundrum that I have never been able to resolve fully is whether companies that are high-performing become that way because they have superior project management capability, or whether high-performing companies do a better job of funding and managing project managers/management. In the case of the “load” statistic from the 2014 PMO study, this would be expressed as, are these companies high-performing because they do not overload their personnel with unachievable burdens of work … or because the project management function has become skilled at resource management?

It’s interesting that low-performing companies always list, as one of their top 5 challenges in studies on ALL topics, that they do not have enough personnel to perform the work they are tasked with. Overburdened and exasperated resources seem to be a distinguishing factor in low-performing companies across all sectors.

But the client asking the question was from the construction industry, so I went looking for some industry-specific information.

The Construction Management Guide recommends a “rule of thumb” that 10% of the hours estimated for a project are for the project manager’s work.  Then you can extrapolate from that how many projects he or she can handle (based on a normal 1800 hour work year.) This of course provides a basic framework, but does not seem to me to allow for varying levels of expertise (in the PM) or complexity (in the project). Much of the discussion of this principle on the CMG site is around this factor. Probably, like most metrics, it is very specific to a company or industry sector. Once baselined, a company could develop its own rule based on past experience.

Here’s another data point from the State of the PMO 2014 that may be related to CMG's project load rule (if you assume that we can view managing the PMO in the same light as managing a project or program):

The median PMO budget, as a percentage of the overall project budget = 4.4%. This is the administrative overhead. It may be a stretch, but let's say that 4.4% of that 10% of a project manager’s hours are merely administrative -- the admin roles that too often get rolled up into a project manager’s job description. To the extent those tasks could be shifted to less expensive roles, it would free up the project managers to manage more high-value tasks/projects. And when an established PMO is working well, such added roles pay for themselves.  For example, the overall percentage of cost savings per project associated with having established a PMO is 15%. (27% for best-in-class PMOs).

So, how many projects is the perfect number? It depends. The competence of your project managers, the administrative support available to that role, the maturity of your processes and of the PMO -- all these factors play a role. Like most seemingly trivial questions in project management, tug on this thread and you find it is connected to big questions of organizational structure and competence.

Next week: Drop back in for a discussion of how to measure programs and PMOs by the hot new metric -- "time-to-value".

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4 Comments on Optimal Project Manager Load

Debbie Bigelow Crawford says:

Such a great topic!  Between this and Vic Allen’s blog yesterday, management should have some good tools to understand and potentially answer this age-old question!!

Posted on July 19, 2017 at 10:21 am

John H. says:

Is it a best practice to create an EPMO to support all of an organization’s project types?  For example, is it considered best practice to include both facility/construction projects and IT projects under the same EPMO?

Posted on November 7, 2017 at 11:35 am

jcabanis-brewin says:

John, yes, our research over the last two decades has consistently shown that organizations that implement enterprise or strategic PMOs do better in all areas of project and program achievement ... and bring value to the corporate bottom line as well… check out our research studies at http://www.pmsolutions.com/resources/category/research/ and thanks for your interest in our work!

Posted on November 7, 2017 at 1:40 pm

Richard Jones says:

Great blog. It is one of the best practice platform to give big helping hand the organisation. Keep posting it. Project management software helps to streamline your business.

Posted on August 1, 2018 at 5:34 am

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