{"id":775,"date":"2015-06-08T12:52:07","date_gmt":"2015-06-08T07:22:07","guid":{"rendered":"https:\/\/www.invensislearning.com\/blog\/?p=775"},"modified":"2026-04-09T15:18:55","modified_gmt":"2026-04-09T09:48:55","slug":"9-steps-to-create-profitable-projects","status":"publish","type":"post","link":"https:\/\/www.invensislearning.com\/blog\/9-steps-to-create-profitable-projects\/","title":{"rendered":"What Is Project Profitability? 9 Key Steps to Create a Profitable Project"},"content":{"rendered":"

According to PMI\u2019s \u2018The High Cost of Low Performance\u2019 2014 report, organizations today are losing $109 million for every billion dollars spent on projects and programs. Organizations that have project management guidance lose 12 times less money than others who do not adhere to project management guidance.<\/p>\n

9 Steps to Create Profitable Projects<\/h2>\n

Whether an organization has undertaken a small budget project or a large-scale one, profitability is measured by the income and expenses a project has incurred during its execution. The following steps will act as a guidance for project managers who are intent on a successful close:<\/p>\n

    \n
  1. \n

    Proper Documentation:<\/h3>\n

    The first step to create a profitable project is to know your processes and the product in and out. By having proper project documentation, it provides information to both the project team and the stakeholders involved in the project<\/a>. The level of detail in this document should be agreed upon and signed off by the project manager, project sponsor and outside stakeholders to ensure clarity in terms of the project. This project document will help the project team to initiate, plan, execute, monitor, and complete the project in a timely and cost-effective manner.<\/li>\n

  2. \n

    Evaluate, Calculate and Forecast:<\/h3>\n

    Project cost accounting is an important step to estimate, calculate and forecast the number of man hours, investment in hardware, software and training, and other aspects of the project. Project managers must build their competency in budgeting resources, ascertaining return on investment (ROI), tracking costs and expenses, to navigate the project effectively towards success. Once the budget is allocated to the project, the team needs to stick to it for each phase of the project, to avoid a situation of overruns.<\/li>\n

  3. \n

    Plan and Modularize Your Work:<\/h3>\n

    Breaking a project into modules is always a good idea, as you will be able to target small chunks of work at a time and have a shorter deadline. It will help in keeping all of the team members aligned and focused towards the big delivery date. For example, if your project would take a month to complete, instead of assigning work and setting a deadline at the end of the month, you can divide it into four phases of one week each. By the end of every week, you would have a clear picture of the progress and roadblocks in your project.<\/li>\n

  4. \n

    Common Repository of Information:<\/h3>\n

    Often, information is not passed down either by sales to the technical team or vice versa. Hence, a lot of rework has to be done. By having a common repository or meeting place, team members and stakeholders can view the progress and access the relevant information shared by another team. This way there is no communication gap, the entire team stays on the same page and there is transparency at all levels.<\/li>\n

  5. \n

    Define the Scope:<\/h3>\n

    This is one of the essential ingredients in project profitability. The scope is not only to be communicated to the team which is working on the project, but also to the client or project owners and get a buy-in. Even scope has to be documented well; having just a verbal confirmation could hamper the progress of the project due to scope creep in the later stages. For example, in an application development project, the project requirement was to provide a login page, with username password and the login The page was created, but when it was shown to the client, the client was upset as the login page did not have a \u2018forgot password\u2019 button and also a \u2018cancel\u2019 button. Hence, the scope document with mock screenshots and a written approval from the client has to be communicated to the team.<\/li>\n

  6. \n

    Rework Every Week on Project Cost:<\/h3>\n

    The financial statements and accounting systems should be revisited weekly or once in a fortnight to check on the cost. Did the project overrun the budget, or is it still under control? Revising the estimate or forecast on a periodic basis helps you to keep a tab on the cost of the project, and if it overshoots, you can raise an alarm and take corrective actions and bring it back within the budget.<\/li>\n

  7. \n

    Clearing Roadblocks:<\/h3>\n

    This is one issue that plagues many projects around the world. The project team may be facing some problems or challenges but these are not communicated effectively in time, resulting in delays in resolution. Clearing all hurdles and roadblocks will make way for successful project completion. For efficient resolution, communication channels should be open and the power distance should be very low.<\/li>\n

  8. \n

    Indicators to Measure Success:<\/h3>\n

    Many organizations have certain key performance indicators (KPIs) in place that measure success, which in turn provides an indication of the project health. For example, a technical executive could have an indicator about how many relevant bugs he has Or for a sales executive, the number of deals that have been signed and the time taken to close them. These indicators can then be tied with incentives to keep your team motivated towards successful project completion.<\/li>\n<\/ol>\n

    There are instances where projects are successfully completed but the project was not profitable for the organization. Profitable projects could be achieved only through the right combination of time, resources, and effective project certification courses<\/a>. By ensuring the steps mentioned above are followed diligently, an organization can be reasonably assured of project success and profitability.<\/p>\n","protected":false},"excerpt":{"rendered":"

    According to PMI\u2019s \u2018The High Cost of Low Performance\u2019 2014 report, organizations today are losing $109 million for every billion dollars spent on projects and programs. Organizations that have project management guidance lose 12 times less money than others who do not adhere to project management guidance. 9 Steps to Create Profitable Projects Whether an […]<\/p>\n","protected":false},"author":34,"featured_media":7110,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[16],"yoast_head":"\nWhat Is Project Profitability? 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