The benefits of agile project management in B2B

What is agile project management?

From the beginning there is already a fixed schedule and the end result is precisely described  – this is what classical project management looks like. This may still work well in some businesses, but in many cases this approach is neither effective nor efficient these days.

Why is that? For one thing, because digitisation has disruptively changed the rules of the game in many areas: Numerous processes have not only become faster, but also much more volatile. And secondly, because the recent crises have thwarted once reliable plans and shaken up tried and tested structures. Proof of this can be seen in the price trends for energy sources, the shortage of raw materials, and the many broken supply chains.

In the face of these factors, companies must become adaptable in order to be able to respond both agile and spontaneous to new conditions. One means to this end is agile project management. It is an iterative procedure in which a product or project is repeatedly tested and optimised in short cycles during its development.
 

The five building blocks of agile project management

In terms of project management, "agility" has five essential attributes that form the building blocks of the method:
 

• Transparency
• Focus on the customer
• Adaptability
• Ownership (effective leadership)
• continuous improvement

In other words, agile project management means bringing a project or a product to market maturity in continuously small steps, while always readjusting, instead of sticking to a fixed plan until completion.

The following overview shows what this means in terms of the attributes mentioned above.
 

1. Transparency

One of the central themes of agile project management is a common understanding of the process among all participants. This requires more transparency in the way teams work and communicate. Especially when different departments and several external stakeholders are involved in a project.

In an agile environment, people openly share their work progress by integrating information-tools. This allows everyone to understand what their colleagues are doing and how they are doing it, which in turn enables sharing on how those involved can do it better.

Furthermore, team members are encouraged to freely share their ideas and challenges without having to without worrying that this could jeopardise their status in the project. In This way, agile work management helps people to admit mistakes and work together to find a solution.
 

2. Focus on the customer

The agile approach to project management places a strong focus on ensuring that customer requirements are well understood through continuous collaboration. The aim is to offer clients not only what they have asked for, but what they actually need.

Therefore, frequent feedback loops in the agile project delivery lifecycle serve as checkpoints where clients can see how their wishes look in practical implementation. This is important because the result does not always correspond to their original idea of the problem solution, as market conditions may have changed in the meantime.

Through frequent collaboration with clients, agile also aims to increase the efficiency of projects by reducing extensive post-completion work. As a result, agile projects lead to reduced production levels and delay costs, making the final product or service more affordable for the end customer.
 

3. Adaptability

Agile project management enables teams to be more responsive to change. This requires more frequent status reporting to the end customer so that teams can get quick feedback directly from the market.

Therefore, agile focuses on an iterative approach where departments break down their projects and continuously synchronise them with customers. In this way, the teams capture any changing requirements early on, quickly adapt to the new situation and avoid delays in the final project execution.
 

4. Ownership

In traditional project management, for example, all information elements pass through a dedicated project manager who assigns tasks to different team members. In the process some information can get lost. In contrast, agile projects leave much of the decision-making process to the team members. This creates an environment of shared responsibility that motivates and empowers teams to work more efficiently.

In turn, leadership becomes more effective because its focus is on managing work and generating profit for the business. Therefore, successful agile-oriented leaders set common goals with their team members and help remove obstacles, by optimising the flow of work, providing the necessary resources and encouraging cooperative learning.
 

5. Continuous improvement

One of the most important characteristics of agile project management is that it creates an environment for continuous improvement. Teams regularly engage in frequent learning cycles on the fringes of project development rather than one big "lessons learned" session at the end of the project.

This results in significant process optimisations even though the project is still ongoing. Furthermore, the work is broken down into small deliverables and continuously handed over to clients for review and feedback. This too contributes to the continuous development of a product or service with the aim of making it perfectly suited for the target customer.
 

The disadvantages of agile project management

The advantages of agile project management described in detail here are also offset by some disadvantages, which, however, are not noticeable in every project. These include
 

• difficult documentation
• escalating project requirements
• challenging time management
• difficult implementation for long-term projects
• difficult to forecast costs
• high communication costs
   

Agile project management in the B2B sector

Classic project management can still work in the B2B sector. However, it only has a future in the case of very clear and rigid processes with few instances. Most projects increasingly involve several stakeholders, some with diverging interests. In addition, market conditions are changing rapidly.

For B2B project managers and purchasing executives, this means an ever-increasing effort.  They constantly have to deal with internal departments involved as well as with external bodies and customers. The result: frequent exchanges, time-consuming coordination and recurrent negotiations on conditions and prices.

This leads to a constant change and adaptation of plans and requirements. These and other coordination challenges tie up a lot of managers' time and potential. Agile project management distributes their responsibilities and tasks onto the shoulders of other process participants.

However, this requires a new way of thinking and working in the company. In the B2B sector with its often long-established (and hitherto proven) structures this new way can hardly be achieved overnight. It is better to strategically plan the introduction of agile project management step by step.
 

1. Step: Convince

The implementation will only succeed if everyone involved is on board. Therefore, the first step is to convince internal staff of the benefits of agile project management. This often leads to important points that can be coordinated with external stakeholders in the subsequent process.
 

2. Step: Create a basis

Once all those involved have agreed to the project, the principles for future cooperation should be determined. It makes sense to manage the entire process through software that is accessible to all participants. It then functions as a platform through which all communication takes place, all tasks are distributed and progress is recorded. This makes it the linchpin for agile project management.
 

3. Step: Implementation

The implementation should start with a comparatively simple project. This can be used to test the most important processes on a small scale and to identify fundamental weaknesses. If the start is successful, more demanding projects can be tackled.
 

4. Step: Optimisation

Agile project management is an agile process in itself. Therefore it is not only important to continuously adapt individual assignments in their development process, but also the method behind them. For this purpose, meetings should be held with internal and external stakeholders to exchange experiences. Here, it is possible to discuss problems and optimise processes.