Project management in the SME sector contributes up to £94 billion to the UK economy each year and employs up to 1.3 million people in project-related roles, according to a new report.
Association for Project Management (APM), the chartered body for the project profession, released the findings in its latest Golden Thread report, which provides a sectoral analysis of the project management profession across three sectors: SMEs, charity and healthcare.
The report, commissioned by APM and undertaken by PwC prior to the coronavirus outbreak, reveals the contribution of projects and project management to the UK economy across these three sectors, as well as the opportunities and challenges facing the profession.
APM identified the SME sector as a key area where there is a desire for greater support and expertise, but also a lack in the necessary resource to optimise project related work.
The report revealed a range of challenges facing the growing business sector, including:
- Skills gaps – SME projects are often run by managers with limited formal training in project management. Upskilling is often a challenge as businesses with fewer employees can find it harder to spare people for longer training programmes. The report highlights a desire for ‘bite sized’ courses to create consumable chunks of learning that employees can fit around their current job roles.
- Uncertainty – SMEs are vulnerable to economic and political uncertainly that can lead to delays or cancellations of mega projects such as Hinkley Point C and Crossrail. SMEs form an important part of mega projects’ supply chains, making SMEs particularly vulnerable if projects are delayed or cancelled.
- Revenue Flow –SMEs have less of a financial buffer to cope with economic change due to tighter revenue flows and smaller workforces. Many SMEs believe transition to Brexit poses a risk as reductions in funding are passed on to local SMEs. SMEs also struggle to compete with larger organisations on price and are unable to pass on increased costs to consumers.
But the report also uncovered opportunities for the future:
- Supply chain opportunity – Local enterprise partnerships will continue to play a role in SME development by assisting businesses to take advantage of local supply chains, particularly around large construction projects.Better access and support to SMEs allows them to bid for work resulting from mega projects, helping drive further growth among the sector and release more revenue for increased employment opportunities.
- Uptake in new industries – Project Management can provide an important contribution to upscaling productivity across different SME subsectors. For example, the creative and media industry can benefit from project management tools to provide structure and platforms to work from.
- Digital – Customer demands are evolving due to advancing technology and how they access products. Embracing digital change could play significant part in SMEs winning greater market share. Update of change management techniques will be important, helping to drive business model changes and make transition to new tech integration and capabilities.
David Thomson, head of external affairs at APM, said: “In this current time of uncertainty and stretched resources, the need for project expertise to deliver projects is greater than ever. Our study reveals that project management can play a significant contribution across the SME sector and has the potential to galvanise change.
“Embedding good project practices across SME businesses can help them not only survive but grow, so having access to these skills is essential. Making project management more accessible is key to growth and APM is committed to supporting SMEs to prosper and grow at a time when their survival is so critical.”
