Top 10 Project Management Challenges Faced by Agencies (and How to Overcome Them)

Project management is a vital component of any successful agency, but it can also be one of the most challenging aspects to navigate. From tight deadlines, and constant pressure, to a lack of communication between stakeholders, there are a variety of obstacles that can arise throughout the project lifecycle. In this article, we will be exploring the top 10 project management challenges faced by agencies and how to overcome them. Whether you’re an agency owner or a project manager, this article will provide valuable insights and actionable tips to help you streamline your processes, increase efficiency, and ultimately deliver exceptional results for your clients. So, let’s dive in and discover how to tackle these common challenges head-on!

  1. Scope Creep

Project creep happens when a project goes beyond its initial requirements and plans without control measures or authorization. The clients or stakeholders can change their minds or don’t know exactly what they want, causing project delays and sometimes frustration for the team. It will then occur extra resources and time to deal with, introducing a huge risk for your agency’s profitability.

How to solve it:

When the project is going on, it’s hard to modify certain areas to meet clients’ new demands that weren’t in the original plan. To prevent scope creep, project managers can: 

  • Discuss and clarify with clients about their goals, and requirements, and agree on an actional plan. Document them and have the client sign off. This helps set boundaries and avoid miscommunications when the client requires something out of scope.
  • Put it down to the contract with clear terms and conditions of how last-minute changes and adjustments will be handled with cost impact to protect your agency.   
  • Devise a scope management plan to manage and minimize project creep, and remind all stakeholders throughout each period of the plan.
  • Apply a project management methodology like the Waterfall or Agile approach and always be ready to incorporate feedback after each sprint or iteration.
  • In case of scope changes, revise the scope and suitable timelines, and make sure to have agreement from all parties.
  • During implementation, use software to track project progress against your schedule to ensure deadlines are met.
  1. Unrealistic Deadlines and Planning Fallacies

Setting unrealistic deadlines is one of the major mistakes of project managers in agencies. There’re several reasons causing this problem, including a lack of proper techniques and estimation, optimism bias, and pressure from superiors to speed up the project.

How to solve it:

Get experience from previous projects and historic reports to get reasonable expectations when setting up deadlines. Here’re some suggestions for your project team to meet the schedule targets:

  • Apply a time estimation technique for your project. Make sure to gather input from all stakeholders on how long it will take to finish a particular task, or how long it will take to review and approve a deliverable. Incorporate this information into your planning phase. Communicate early and get everyone on the same page.
  • Investigate past data to gain insights into realistic deadlines, pitfalls, or risks. Check how long a similar project took to complete, what tasks went overdue, any bottlenecks, and the buffer hours used for the last projects. You may find some patterns that lead to missed deadlines and devise solid risk management plans for them.  
  • Regularly monitor the deadlines and control schedule by using a time-tracking or project management tool. It offers your team visibility into the timeline and progress and prevents any surprises. The time record for each task is also valuable data to help you better plan for future projects. 
  1. Unclear Project Goals and Misalignment with Business Objectives

Another challenge in project management is the lack of project goals and the mismatch between the goal and the agency’s business objectives. This often arises because of poor planning. Many marketing agencies immediately rush for new projects and spend little effort to establish a clear goal to guide team members. In some cases, the project even conflicts with the agency’s business strategy and may hurt your long-term roadmap.

How to solve it:

Depending on your agency structure, you can involve project managers in the project pre-planning stage. The purpose of this stage is to develop a business case that analyzes the financial and business value of a particular project execution. This business case document should be reviewed by BOD to decide whether or not to proceed with the project. If yes, you can communicate the business case to align leadership and your team on the project purpose, its core objectives, and expected value. 

  1. Inefficient Resource Allocation 

Allocating resources properly and avoiding scheduling conflicts are crucial factors for a project to succeed. Tasks should be assigned to the right person with suitable roles and skill sets. However, not all marketing agencies have sufficient budgets or resources, which forces project managers to manage the work with what are available. Unfortunately, it means some team members, contractors, or vendors do not have the right skills to deliver high-quality output for a specific task. 

How to solve it:

There’re various ways for project managers to distribute resources better: 

  • List out in detail all the deliverables and the skills required to achieve them. Then, evaluate your current resources to identify any skills gaps.
  • If you find a skills gap for your project, carry out a “make or buy” analysis to decide if your agency should recruit in-house personnel or hire an external professional to perform the scope of work. 
  • Adopt a project management system to gain a 360-degree view of your resource scheduling, capability, and timelines. Review the workload of each team member to assign proper tasks, ensuring that no one is under or overworked. 
  • Add some contingency plan to reduce risks in your time estimates:
    • Place a backup teammate for each task who can jump in if needed;
    • Put buffer time into your planned schedule to account for unforeseen situations;
    • Add breaks between tasks for each member to prevent scheduling issues. 
  1. Poor Communication

Ineffective communication is one of the most common challenges for agency projects and confuses the team. Misunderstanding and misinterpretations make people bumping around unclear on their responsibilities, and “who is doing what”. If you cannot provide transparent instructions and properly assign tasks, the high chance is that your project will fall short. 

How to solve it:

Establishing a communication plan is critical to provide a standardized system for the project team to exchange information. You should determine which communication methods such as emails, phone calls, meetings, or memos shall be used for different areas or milestones across the project life cycle.

For example, in case of scope additions, the project manager should refer to the communication plan on how best to deliver the notice to the team, whether via meetings or emails, etc.

Furthermore, you can adopt and implement project management software to keep everyone informed on project updates, provide visibility on project status, and boost transparency. The software also helps centralize all discussions, correspondence, and feedback on tasks and milestones. 

  1. Lack of Accountability

Accountability is crucial for the success of a project. Note that, teamwork makes the dream work. A project team is a group of people with different skill sets, specialties, work habits, and personalities. For a project to run smoothly, all members have to be accountable for their work and coordinate effectively. Any lack of accountability can cause a ripple effect that negatively impacts the project workflow. 

How to solve it:

Here’re some strategies to improve accountability:

  • Communicate with all project stakeholders and team members during the project kick-off to clarify the roles and responsibilities of each person and how to measure their performance. 
  • During the project execution, closely track progress and hold regular meetings to address issues and roadblocks along the way. 
  • Provide training to support team members with the necessary skills to handle the project successfully.
  • Use incentives and rewards to motivate your team and encourage them to take ownership of their work.
  1. Inadequate Project Budget

Many agencies today encounter the difficulty of doing more with less, which can be a daunting task for project managers. The budget and resource constraints can be overwhelming, and many stakeholders urge project managers to accomplish a perfectly-planned project at the maximum speed and minimum budget. 

How to solve it:

Budget constraint pushes project managers to make the trade-off decisions between speed and quality, such as limiting the use of particular resources and applying a strict cost control initiative. In this way, you can make the most out of the available budget, prevent delays and consequently, bigger costs.

  1. Imbalanced workloads

A happy team with balanced workload management is essential to go a long way, not only for 1 project but also for future projects. In contrast, imbalanced workloads create many troubles for human management, such as burnout, stress, anxiety, disengagement, quiet quitting, and team conflicts between people overloaded and those with little work.  

How to solve it:

To unravel the headaches of imbalanced workloads, check out these ideas:

  • Right from the early stage of the project, identify your team’s existing capacity to develop an appropriate workload management plan:
  • Once the project is up and running:
    • Review the schedule and record time to compare the planned vs actual workloads
    • Drive communication within the team to better assign tasks based on each member’s workload
    • Hold regular 1:1 meetings with your members and see how to support them 
  • If you still need to  rebalance workloads, here are some methods:
    • Check for individuals who might temporarily have some extra hours
    • Train underworked members on critical skills to handle more important jobs
    • Redistribute work to even out the workload among team members
    • Consider outsourcing some parts of the project to other freelancers or agencies 
  1. Insufficient Risk Management

Many agencies underestimate the importance of risk management, which puts them in a passive position when risks occur. There’re various attributes that can create risks for a project, including both internal and external factors:

  • Internal risks: issues related to personnel, contract management, cost management, procurement, and subcontract management.
  • External factors: coming from clients, competitors, financial (taxes, currencies, interest rates, etc.), market changes, and government regulations. 

Since there’re so many variables that can endanger the project, having the ability to foresee and identify different scenarios and create a contingency plan is vital. 

How to solve it:

Project managers must foster a risk management strategy and anticipate actions if risks happen. The plan includes: 

  • Identify all potential risks by categories of internal and external as mentioned above
  • Calculate the possibility of occurrence and the impact of the risks, and rank them from 1 (very low) to 5 (very high)
  • Create a matrix with 2 dimensions of possibility and impact as below table. Classify the risks into 3 categories, with the green area representing minor risks, yellow meaning medium, and red illustrating the high risks that must be tackled:
  • Develop measures on how to address or respond to each risk based on 4 strategies: Avoid, Reduce, Transfer, or Accept.
  1. Outdated data in PM software

Project communication can be disrupted if your team neglects or forgets to update the project management tool. It leads to bad outcomes such as missing important information, hard to stay on top of the progress, inefficiency to report, and lack of team collaboration. 

How to solve it:

Choose a project management software that is intuitive and easy to use. Function Point is an all-in-one agency management software that offers robust project management tools, CRM and estimating, resource management, team collaboration, financials, and reporting features. It helps you to automate workflows, enable smooth teamwork, and allocate resources properly, all in a single dashboard.

If your teammates are reluctant to use new technology, implement a change management plan. Show them the benefits they will receive with the system, listen to their feedback, and conduct training sessions on the best practices to use the tool effectively.

In Conclusion

Managing a project successfully is a challenging task for any business owner or agency manager, but it can be improved. We hope this article has given you the necessary information on the top 10 challenges and the solution for the agency’s project management. Applying the above strategies will help you overcome the problems and direct your projects to success. 

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