Project Management Software

What is project management software?

The term project management software (PMS) refers to all categories of software that are used to support executives, project managers and team members in the planning, execution, controlling and documentation of projects. In addition to functions for project planning and project execution, PM software also offers features for evaluating project data.

Some software products only cover certain parts of what project management entails, like time scheduling. There are also software solutions that combine all tasks that are relevant to project management. The following list gives an overview of the different types of programs that are generally subsumed under this software category:

• Planning Software (Time planning and scheduling, incl. solutions that feature Gantt-charts and diagrams for visualizing project schedules)
• Resouce Management Software (For planning and balancing of project resource capacities, often as part of an Enterprise Resource Planning-system (ERP))
• Project Portfolio Management Software (PPM; Used to identify projects that have positive effects on the corporate value)
• Controlling and Accounting Software (For project budgeting, reporting and accounting)
• Document Management Systems (DMS)
• Task Management Software
• Communication Software for teams

There are solutions in the market, that combine several or even all of the above mentioned features and aspects of project management in one single tool. They are what would be considered full-feature software solutions.

Comparison of task management and project management tools

The market for project management software can be quite confusing, as many providers use the term project management for their tool, but often lack the functions required for professional project management. The following overview of some well-known software solutions therefore contains a description, advantages and disadvantages as well as an assessment of task management, project management and project portfolio management capabilities.

Asana, Monday, Trello, awork, ClickUp - task management tools:

With Asana, Monday, Trello, ClickUp and awork, the strength lies in task management, i.e. in the optimization of daily work and the organization of tasks in the team rather than in project planning, control and evaluation. This can already be seen in the avoidance of the word "project" in some of these applications. All of these tools facilitate simple team collaboration and communication in the task context. If you are looking for a tool that helps you and your team to organize yourselves with digital Kanban boards instead of Post-its, you will find it here.

Asana

A look at the Asana website explains how the US software manufacturer sees itself: the aim is to support the organization and management of work processes in teams. With beautifully designed to-do lists, Kanban boards, timelines and calendar lists, small teams and agencies in particular can bring structure and order to their tasks. Those who like it playful will be delighted by the gamification element, which makes a unicorn jump across the screen when a task is completed.

Workflows, i.e. the automation of work steps, is another focus of Asana. Here too, the software shows its strength in task management: a new task can be assigned to a specific person, for example, or a text module can be added as a comment, without any programming knowledge.

Asana allows an assessment of the team's capacity via the workload manager. However, the workload manager only accesses the tasks in Asana. This means, for example, that day-to-day business, which consists of jour fix appointments, telephone conferences or planned absences, are not automatically taken into account for a realistic mapping of the workload.

Another shortcoming of Asana becomes apparent when professional project managers want to plan the time schedule in the Gantt beyond task management. There is a lack of sophisticated planning functions to visualize more complex interlinking of tasks and milestones, such as dependencies or restrictions. Dependencies between several projects in a multi-project view cannot be visualized either.

Asana is only available as a SaaS solution, so it cannot be hosted as an on-premise solution on a company's own servers.

Conclusion on Asana: a nice, lean task management software with project management functions for simple projects in small teams. For complex project landscapes and departments with real portfolio requirements, other tools are the better choice.

Monday

The Israeli company has continuously expanded its Monday software from a colorful task management software to a work management platform. In addition to monday projects, the product portfolio now also includes monday marketer, a CRM tool and a dev tool for developers. And here comes the first hurdle: if you want to have simple project management functions in addition to the tasks in the work management platform, you have to purchase monday projects.

As with Asana, Monday focuses on a beautifully designed web interface and a fun color concept. All work management activities are based on tasks, so Monday is more of a task management tool than project management software for planning, executing and evaluating complex project landscapes. This is because monday projects enables Gantt planning of temporally and logically interdependent project phases. However, important functions such as dependencies or critical paths are only in the beta phase of development.

With budgets, workload view and time recording function, Monday also offers tracking and controlling functionality similar to Asana, which is important for monitoring and evaluating tasks. These so-called widgets are customized by the user and can be configured by the user in the settings.

With its products, Monday therefore seems to want to develop in the direction of project management as well as CRM, development tool and marketing platform. The cloud product is available as a SaaS solution and cannot be hosted as an on-premise version on the company's own servers.

Conclusion on Monday: a platform that is not yet fully developed for project management with many different options that can be purchased modularly in addition to the core product Work Management for Tasks.

Why project management software?

The added value of project management software lies in the processing possibilities of the digitally available project data, which is not the case with manual aids such as paper plans or Post-it Kanban boards. Thanks to project management software, projects can be evaluated and compared. For project leaders and the c-level management, such evaluations are important to determine whether project goals are being achieved.

A team needs a project management software to stay on top of things and make the best use of all available resources. Even if things seem to work well without it, project management software reveals numerous optimization opportunities that help employees and the company get the products and services they offer to market faster.

The more complex and demanding projects become and the more team members and project stakeholders are involved, the more difficult it is to keep track. This is where a project tool helps you master these challenges in your project work:

Better project management

A project management software supports project managers and project teams in the entire project life cycle and in all areas of the field:

• Project planning: Project tools help you track project costs, returns and deadlines - this makes planning and coordinating much easier. 
• Task management: Organize personal and project tasks and stay agile with virtual Kanban borads - so team members always know what to do and when.
• Document management: Create new documents and interlink existing ones in a virtual project space - staying organized becomes effortless. 
• Resource management: Track real-time capacity utilization in your teams and departments - so you can identify bottlenecks in time and optimize the workload distribution. 

Better communication & coordination

The increased complexity means that communication and coordination gets more and more difficult as well. A manual distribution of the most important information carries a high error risk: information is lost because it was forwarded by email or phone, the information went to the wrong person or the person who needs the information did not receive it. A project tool can automate such processes and consolidates all relevant project information in one place. Team members no longer have to laboriously gather the information.

Save time and get a better overview

In today's world, companies are under enormous pressure to innovate to stay competitive. New products have to be launched in ever shorter intervals, while at the same time costs have to be kept as low as possible. This means that every additional day in a project also means additional costs. For project managers, this means that adherence to schedules has the highest priority. A project management solution can help companies deliver their projects on time. The fact that certain processes can be automated with project software saves a great deal of coordination and administrative effort. Project staff always know exactly who has to do what when and by when. This provides much greater transparency and avoids the scenario where several resources do the same tasks. Project tools can also display budget and time alerts so that project managers can take timely action to counteract possible budget overruns and other unforeseen events. 

Which features does a good project management software have to have?

Every project management software has more or less extensive functionalities. Depending on the use case, a scheduler or a digital tool with a to-do list may be enough for a small organization. For larger teams and projects, the company will save time and money in the long run with a professional platform that includes all the features needed in the planning, collaboration and evaluation process of projects.

In short, the following functionalities are necessary:

• Project planning and scheduling features
• Task management features
• Collaboration features
• Resourcce allocation
• Document management
• Reporting & Controlling features

Tool for project planning and task management

One of the most basic and important functions of project management software is task management. There are different features for it depending on the tool.

The most well-known form, which everyone knows from their everyday life, are to-do lists. The best programs allow you to add notes, graphics, documents or links to each task. Other project-relevant information such as the responsible resources or the deadline are also useful.

The visualization of this data can range from a simple checklist or a calendar to more advanced possibilities with a Gantt chart or a Kanban board.

Important features for project planning and task management at a glance:

• Specification of project data such as duration with start/end or department assignment
• Project roles with distinct assignment of persons
• Work breakdown structure in Gantt format for project phases and milestones
• Project status and progress
• Tasks in project context in Kanban format
• Task status and task progress
• Filing documents in the project and task context
• Workload manager for effective use of capacities
• Templates for recurring projects or tasks

Teamwork and communication

Only teamwork and clear, efficient communication can make a project successful. Every project member should always be up to date. For this, regular communication is important so that everyone knows the priorities, the scope of work, the project status and the deadlines. To prevent the team from wasting valuable time in tedieous update meetings, project management software is the central place to get up-to-date data.

Project leaders can add new tasks or change tasks in the software and communicate those changes to employees via automatic notification. This push principle saves many a meeting. In addition, all project members have the possibility to independently obtain real-time information about the project or their own tasks at any time. This information pull principle supports the independent work of all team members.

Often, one of the well-known video chat tools such as Meet, Teams or Skype is used for communication within the company. However, the best project management software solutions have a communication tool integrated so that users do not have to switch to another program. The most important advantage of this is that all information in the project or task context is captured directly in the system and no important data or information can get lost.

Important teamwork functions:

• Kanban board with clearly assigned tasks
• Comments on projects, tasks and documents
• Display of status and progress updates
• Task and project description
• Push notifications on changes in the project or tasks
• Document management in project and task context

Document management

Teamwork also includes the central storage of data in a cloud or on the company's own file server.

Here, employees can access a document, a spreadsheet or a presentation and file them in the project management software, e.g. in the project or attach them to tasks. The project management software stores all documents in a central location, avoiding countless copies of a file. Via their own cloud storage, all authorized people have access to the files and can even share new documents with the team members.

Based on their permissions, users can change or comment on all the files. If documents are not to be changed or are only allowed to be changed by certain people such as the project manager, assigning appropriate access permissions is another useful feature.

An alternative to this is versioning. This allows you to see who changed the document, when and how, based on the editing history. In this way, backups are automatically created of each document with earlier versions in the archive, which can be easily restored if necessary.

A search function helps to quickly find files in extensive data archives.

While the best project management platform providers rely on a turnkey solution, basic solutions charge an extra fee for using an external service from providers such as Amazon AWS, Google Docs or Microsoft SharePoint.

Important document management functions:

• Own central cloud storage
• Automatic synchronization with the cloud
• Permissions management
• Document archive
• Versioning and backups
• Search function

Resource management and controlling

Resource management includes the use of all available employees, machines, materials or rooms. The project manager assigns tasks to the available employees according to their availability, qualifications and performance. If changes occur in the resource or task load, the project manager must be able to redirect at short notice so as not to jeopardize the project goals. The employees should neither be underchallenged nor overchallenged at optimal workload.

A practical function of project management software is the Gantt chart with project phases consisting of individual tasks. If these tasks are assigned to employees, the workload in the project can be displayed. In addition, this clear project plan visualizes the critical path, bottlenecks and any planning errors and enables timely rescheduling.

Important functions for resource management

• Allocation of resources to tasks
• Recording of duration and effort in tasks
• Time tracking of effort in relation to task, project phase or project
• Evaluation capability of resource utilization
• Easy resource redistribution

Reporting and controlling: features for evaluation

Often, the project manager is also responsible for reporting and controlling the project to the management or the executive board. The main task is to keep track of all parameters of a project and to control (hence the name) whether the project is carried out as planned. This includes meeting deadlines, goals, and most importantly, costs. The best project management software solutions allow users to create customized reports. This allows management to get a quick overview of the most important key figures of the current projects.

In controlling, the integration of project management software with other company-relevant software systems plays a major role. After all, it is often important to merge project data relating to budgets with data from purchasing or accounting. In order to provide the company management with clear data evaluations, dashboards should, for example, automatically display project margins or capacities with just a few clicks.

Important functionalities for reporting and controlling:

• Standard reports for project kickoff, status or end.
• Customizable reports with selected project data
• Standard dashboards for project key figures
• Customizable  dashboards with selected project dates
• Export function and print function of reports and dashboards

When do you need project management software?

When you feel like you have lost sight of the big picture in your daily work and cannot clearly say what you and your team need to do and when to do it in order to achieve your work goals. If you are not able to quickly have all the information at hand to complete your tasks. Another indicator is the tedious, manual gathering of data to evaluate your projects for management. Then it's time to seriously consider implementing a project management software.

The right time to implement a project management software is an individual matter. However, it can generally be said that this always triggers a so-called change process. After all, the introduction of project management software is usually accompanied by changes to processes and procedures that affect all employees in the team, the department or the entire company. Since people are initially skeptical of change, it is advisable to plan this change process for the introduction of PM software well and to present it transparently.

Tip: if you have the opportunity to test the PM software free of charge before purchasing it, then plan the software introduction right away with it. You kill two birds with one stone: 1. you get to know the software in a real scenario and 2. you have laid the important foundation for the successful PM software introduction without additional costs. A test period of 3-4 weeks is ideal for this.

What are the advantages of integrated project management software?

Integration options in the existing software environment enable the automatic exchange of data between the project management software and other applications that contain company data. This makes it easier, for example, to combine project data with data from purchasing or manufacturing and evaluate it in dashboards. This data is always up-to-date and can be accessed at any time. Manually merging data from different software applications, on the other hand, is not only time-consuming but also very error-prone, and the accuracy of the data is not guaranteed.

Integrations are programmed via so-called interfaces. This requires an open programming interface (API - Application Programming Interface) to enable data transfer between systems. So-called standard integrations are provided by many PM software solutions, such as an Outlook or Gmail integration, or a Microsoft Project integration for importing project plans. Many project management software vendors offer an open API and actively work with users to implement custom interfaces tailored to the needs of individual customers. This could be, for example, an interface for data exchange with ERP systems such as SAP.

Advantage: Controlling and forecasting

The greatest advantage offered by integrated project management software benefits company management: Project data can enhance company data to the extent that forecasts can be made for the future via project controlling. This happens, for example, when the completed projects of a year clearly show where the margins are greatest or which products and services were sold best. The budget data from the projects can then be further enriched with the budget data from other programs and evaluated. Thus, the C-level can make informed decisions for the alignment of its business strategy.

Advantage: Ease of use increases user acceptance

The advantages of PM software with integration capabilities can also lie in easier usability, which leads to better acceptance and real use of the project software. For example, if order placement is done by e-mail, it makes sense to integrate the PM software into the e-mail program (e.g., Microsoft Outlook). This allows a project proposal to be created from the e-mail, which contains all the important information from the e-mail as the project description. The integration reduces the effort to create a project and shortens the process, which motivates users to use the project management software.

How to find the right project management software?

If your goal is to find project management software that fits your needs and is used consistently by your team, the department as a whole, or the entire company, you need to take a structured approach when comparing project management software solutions.

Basically, you should follow the following steps:

1. Analyze the current state
2. Interview users
3. Clarify technical requirements
4. Initiate product research
5. Test software
6. Ensure user-friendliness
7. Define implementation effort
8. Narrow down product list & obtain offers

In the article Project management software comparison: Step by step finding the right tool, you can read best practice tips to quickly separate the wheat from the chaff and make an informed decision. The free PDFs and checklists help you find an individual basis for decision-making and save valuable time.

Is free project management software sufficient?

Short answer: No. Because free applications do not have enough features for teams, have a limited capacity of projects, very low storage or are only allowed for 1-5 people. Often, users of free PM software receive limited support, usually not even in their native language, and have no access to additional resources such as templates and free events.

Free project management software provides insufficient support for a team because, above a certain level of complexity, extensive functions and workflows are necessary to work effectively.

However, free project management tools have the advantage of zero cost to test what the impact of digitizing your project management is. This is also the reason why many providers offer a free trial version - you have the opportunity to try out whether the software suits you without any financial pressure.

Is an open source solution an option?

The term open source software refers to computer software that allows its source code to be viewed and modified by third parties. An open source project management software is usually cheaper or even free of charge. The cost savings start with the purchase, but also extend to deployment, support and maintenance. The challenge is to have qualified people within the company for this development and support. Or, a qualified external service provider can be found who has expertise in customizing, maintaining and supporting the open source solution in question.

A hybrid form is licensed open source software. Here, companies pay for the source code, but internal employees are trained to be able to carry out the adaptations, etc., or an external service provider is also commissioned with this.

The expense can quickly become unprofitable and there is a risk that the know-how for the open source solution will be lost. This happens as soon as the responsible employees leave the company or the external service provider can no longer provide the service for various reasons.

What are the arguments in favor of a comprehensive solution?

Different departments often have very different requirements for project management software. While production works with fixed deadlines and dependencies, marketing departments often only keep a task list and want to know who is currently working on what and how the individual team members are progressing. For IT teams, it is important to show connections between individual phases or impementation cycles.

It's no wonder, then, that companies often have isolated solutions that hinder cross-departmental collaboration. But is it even possible to introduce an overall solution for project management across the entire company under these conditions?

A solution for all teams and departments is desirable, as this would set uniform standards and make it much easier to collaborate on projects across departments and specialist areas.

However, whether this is possible depends on the software for project management itself. Ideally, different approaches and methods can be used and also combined on one platform. Users are not told how to plan and manage their projects - they can decide for themselves. Often it is sufficient for teams to manage projects without a Gantt chart, but only via tasks in the Kanban board. However, when it comes to mapping complex dependencies between project phases or entire projects, detailed phase planning is indispensable. A suitable PM software should enable this flexibility.