7 Ways to Improve Project Efficiency

7 Ways to Improve Project Efficiency

As project management shifts toward more transparency, clients are increasingly interested in how well the team spends its time and resources. Project teams are expected to “do more with less,” and to “work smarter, not harder.” While these are good practices to adopt in general, the challenge for project managers is quantifying how much value goes into a project compared to the value that comes out. One common metric for this is project efficiency.

This article explores what project efficiency is, why it’s important, and how you can improve the efficiency of your next project.

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What is Project Efficiency?

Project efficiency measures the project output compared to the team’s investment in project management resources. A project efficiency of 100% indicates that the project was completed fully within the planned workforce, cost, and schedule constraints.

On the other hand, a project efficiency of less than 100% indicates that the project required more resources than planned. That might be due to a lack of proper planning early in project development, poor resource management during the project, or external factors such as natural disasters or key personnel leaving the company.

Project efficiency is an essential metric for project managers because it can show how well the project team is performing and which areas have room for improvement.

Project Efficiency vs. Project Effectiveness

Project efficiency is often discussed together with project effectiveness, which is a measure of how well the project meets customer expectations. While high project effectiveness is a result of correctly identifying the customer need or appropriately aligning the project with the organization’s strategy, high project efficiency comes from developing and employing the right processes during the project itself. 

When viewed together, project efficiency and project effectiveness can provide a clear picture of how successful the project was. For example, high project efficiency and high project effectiveness indicate that the project output met customer requirements, and the project team was able to deliver within the planned timeline and budget. However, low project efficiency and high project effectiveness suggest that the project delivered what the customer expected, but the project was subject to delays and/or cost overruns.

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How to Improve Project Efficiency

Achieving high project efficiency takes team discipline and commitment, but it’s not impossible. Here are a few practices project managers can adopt to maximize the efficiency of their next project.

1. Focus on Communication

It shouldn’t be a surprise that good communication is key to improving project efficiency. Research shows that of all the money that’s at risk for a given project, 56% stems from poor communication. For example, if stakeholders do not have shared expectations about their roles or how they will be impacted, team members are not clear about what is expected of them, or the business case for the project is not well understood, project efficiency will be compromised by rework, redundant communications, and people chasing answers to questions they shouldn’t have to ask.

Importantly, the approach to project communications should reflect the dynamic nature of projects — different people prefer different channels. This could include emails, videoconferences, phone calls, in-person group meetings, or one-on-one discussions. Different people prefer to get different content, such as status or progress, information about issues, details on costs, or schedules. Some may need information monthly, some weekly, and maybe others daily. It’s up to project managers to consider the unique communication needs of key stakeholders when planning and then adapt to those changing needs as the project evolves.

2. Establish Firm Schedule Goals and Milestones

Every stakeholder, including everyone on the project management team, should have a clear understanding of the schedule goals and milestones of the project. That isn’t to say that those goals can’t be adjusted, but all schedule goals and milestones need to be firm enough that the project team knows what to do to meet those goals and how close they are to meeting them.

3. Choose the Right Resource for the Right Job

While every project manager dreams of having unlimited experts and budgets at their disposal, the reality is that there are only so many resources that can be dedicated to a project.

During the planning process, it’s important for project managers to communicate what resources they need to get the job done. At the same time, they need to be creative about making the most of the available resources during a given project, especially when there are unexpected hurdles along the way. Poor resource allocation that doesn’t make clever use of the project management team’s strengths and talents will waste time and lower efficiency.

4. Empower the Team

Good project managers are true team players. Not only are they willing to trust the team to get the job done, but they also encourage team member collaboration to build a common working culture and achieve project goals as a collective. Project managers are there to support team members and guide the efforts of the project management team as needed.

Closely related to team empowerment is the need to keep team morale high. Project managers should prioritize checking in with team members, praising successes publicly, providing negative feedback privately, and ensuring that the team stays motivated throughout the life of the project.

5. Find A Good Project Management Tool

A good project management tool won’t cure a poorly managed project, but it can improve project efficiency by enabling easier communication, goal tracking, and resource management. Project management tools increasingly help with project efficiency given how many project teams are geographically distributed and working remotely.

There are plenty of project management tools available as desktop applications or cloud-based platforms. Some of the most important questions to ask when selecting a project management tool include:

  • Is the application designed to work with your project management methodology or approach?
  • How well does the application integrate with other software used by the organization?
  • Are the out-of-the-box features adequate to meet the needs of the project? If not, how easy is it to customize the application?
  • How important is having an offline desktop version? Will the project team always have reliable internet access to use a cloud-based tool?

Finally, a project management tool only works if it’s used. While it’s tempting to pick the most advanced applications, novel tools with steep learning curves can threaten to cancel out promised efficiency gains.

6. Understand the Concept of MVP

An efficient project should strive to achieve an MVP, or minimum viable product. That is, the project team should prioritize putting in the minimum amount of work to achieve a deliverable that’s of value to the customer.

Of course, every team wants a perfect project. But when project managers need to develop strategies to make the most of limited resources, it’s important to remember the Pareto principle — it takes 20% of the time to complete 80% of a task. When 80% is acceptable, and resources are limited, dedicating more time to achieve perfection will only lead to waste, increased project risk, and lower project efficiency.

As Confucius once said, “Better a diamond with a flaw than a pebble without.”

7. Learn From the Past

A project shouldn’t disappear from memory once it’s completed. One of the most valuable forms of intellectual property for an organization is its knowledge base of past projects, which can help project managers learn from each other about what they did well (and repeat those practices) along with what they didn’t do well (and improve in the future).


While project success means different things to different organizations, sponsors, and other key stakeholders, project efficiency is often a prime consideration. As stewards of the project, measuring and achieving project efficiency is the responsibility of the PM, that is, making sure that the project makes good use of the resources available to deliver value on time, within budget, and within scope. By employing a few simple strategies and best practices, project managers can maximize the efficiency of their projects and the chances that the project will be an overall success. Interested in learning more about project efficiency? Get in touch with us today!

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