Outsourcing project management can be a great way to save time and money on a project, but it can also come with risks. When done correctly, outsourcing can help a team manage their time more efficiently and get the project completed on schedule. However, if not done correctly, outsourcing can lead to communication problems and missed deadlines.

In this article, we will discuss the benefits and risks of outsourcing project management.

A project manager needs to be a leader that resolves issues head-on while adhering to project deadlines. Additionally, they should be a mentor, facilitator, and problem-solver for the project team.

Outsourcing this position provides 5 clear advantages that address these skills:

Benefit 1: Skills and Experience. Outsourced PM's arrive having worked on multiple projects, with a variety of clients across a range of industries. Having experience in both software development, and project management. In the outsourcing company, they will have multiple PM's with various skill sets, allowing for the client to choose the best place to successfully deliver their project.

Benefit 2: Time Saving. Internal PM’s often get stuck with managing day-to-day activities and solving problems around internal business activities. When outsourcing the PM position, they oversee keeping the project in scope, and on track freeing up internal PM’s and stakeholders to work on BAU.

Benefit 3: Cost Effectiveness. Recruiting, training, and maintaining an in-house PMO is out of the range of a lot of small to mid-market businesses. Hiring several new employees will take months to yield tangible results. Outsourcing this position is a more cost-effective way to get the project started on time and on budget, without the added expense of adding in the hiring and training processes.

Benefit 4: Schedule Compliance. The main responsibility of a PM is to make sure that the dev team adheres to deadlines and doesn’t go over the scope and over budget. Having a PM that has worked on many similar successful projects, and sees issues arising well before they materialise, helps to keep good schedule compliance.

Benefit 5: A Fresh Approach. Hiring an outsourced PM, allows for an impartial view, unbiased insights, and just looking at the project from a different viewpoint. This can be crucial in evaluating project risks, and effective business decisions.

As an outsourcing company, we are of course going to lean towards the benefits, however, for balance and successful results, there are risks of outsourcing that you need to be aware of.

Security Concerns - All project managers have access to sensitive information, if this data somehow becomes leaked, it could cause several issues from regulatory fines, loss of customer confidence, and downtime. When working with outsourced businesses, you need to ensure that data protection policies are extended to the outsourcing company and the PM.

Communication Issues - Having a fresh perspective from an outside view can be a blessing, but we also need to take into consideration the lack of process understanding, internal structure, and company culture. Making sure that the PM has a clear understanding of business operations and goals is super important.

Employee Acceptance - An outsourced PM could upset the applecart; employees may be unaccepting of the incoming PM’s decisions and processes. It is important that regular team meetings are held to foster a collaborative environment. Choosing the right PM will help solve this problem.

In conclusion, outsourcing project management can have a variety of benefits and risks. It is important to weigh the pros and cons of outsourcing before deciding. Outsourcing can save time and money, but it can also lead to communication problems and missed deadlines. By carefully considering the benefits and risks of outsourcing, businesses can make an informed decision about whether or not to outsource their project management.

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