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What is Project Business?

Project Business

We are Project Business Experts at Adeaca. So, what do we mean by “Project Business” and how is that different than Project Management? The point of this article is to properly define Project Business as a category of business, and to demonstrate why it is an important concept to improve business results.

Defining Project Business

Project Business companies organize their primary business activities in projects. They are sometimes called project-based, project-driven or project-centric companies. These companies operate in project-driven industries such as Architecture, Engineering & Construction, ETO Manufacturing, and Professional Services – we call these Project Industries at Adeaca. Project Businesses span many traditional industry labels, but they have the same fundamental business practice – they deliver projects for their customers.

The Difference Between Project Management and Project Business

Project Management is the application of knowledge, skills, tools, and techniques to complete projects. Project Management is something that a business does, regardless of the type of business it is. Project Management is done by retailers, manufacturers, pharmaceutical companies, wholesalers, as well as AEC, ETO and PSO companies.

Project Business, on the other hand, is a higher-level function. It defines, in its essential form, the type of business the company is. As stated earlier, Project Businesses are commercial entities that deliver projects for their customers. Project Management is a central component of a Project Business, but it is not the only activity.

Another way to look at it is to consider that projects are temporary, and therefore managing a project is temporary. However, Project Business is enduring, and therefore managing a Project Business is an enduring activity, separate from but subsuming Project Management as a discipline.

The PM Podcast: why identifying as a Project Business is critical to improving productivity and optimizing your business for success.

Projects as a Business Model

If we consider projects as a type of business model, we can compare it to other traditional industry sectors, such as retail, manufacturing or distribution.

If we think of a Retail Business, it is about reselling goods to consumers. It doesn’t matter what goods you sell. You could sell clothes, tires, cars, light bulbs or stuffed animals. Whatever it is, if you sell it to consumers you are a Retail Business.

If we think of a mass Manufacturing Business, it is about producing products and selling those products to a distributor, retailer or end customer. It doesn’t matter what products you make. You could make clothes, phones, furniture, or televisions. Whatever it is, if you manufacture it you are a Manufacturing Business.

Project Business is the same. It is about running projects as your business. It doesn’t quite matter what the end product or service is.

Project Business is a significant portion of all companies and growing

It could be a building, a bridge, an airplane, custom software, a corporate tax report, a new business strategy, or an engineering design. Whatever it is, if you produce it by running and delivering projects to your customers you are a Project Business.

Considering all the traditional project-based industries, about 20 to 25% of all businesses are Project Businesses. This is significant, and comparable to the other sectors such as Retail, Manufacturing and Distribution. So, we must take them seriously.

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How Project Business is Different

Although we can compare Project Business to Retail, Distribution or Manufacturing, there are some major characteristics unique to Project Business that make it significantly different from these traditional industries and underscore its complexity.

 Unlike traditional businesses, projects are temporary and mostly unique to each customer. In contrast, Retail, Distribution or Manufacturing companies produce or sell the same goods repeatedly. This consistency allows these companies to take advantage of standardized processes and KPIs, automation, and economies of scale much more easily than Project Businesses. As a result, these traditional businesses are more predictable and replicable than their Project Business counterparts.

If we delve deeper into the process side of these firms, we can uncover even more complexity in Project Businesses. In traditional industries, processes are standardized no matter who is doing the work. For example, the way a television is assembled is the same regardless of the worker assembling it. Or, the way a sale is entered in the POS system is the same across a retail company, no matter where the store is or who the sales person is. Processes and data are completely standardized in these traditional industries.

Conversely, in a Project Business, the way processes are completed can differ depending on who is doing them. For example, the amount of detail included in a project plan can differ between different project managers with different preferences. Similarly, the way a project is estimated and budgeted could differ based on different locations and diverse sales teams. Even the information and data that is considered important and used to make critical business decisions can be different or derived differently across the company. This characteristic of Project Business makes it ever more complex and difficult to manage than traditional businesses.

To illustrate the effect this difference has on business performance, we have seen productivity in traditional sectors continue to grow while it has remained stagnant or even faltered in Project Business sectors. This increase in productivity has largely been attributed to technology. However, in traditional industries, it’s much easier to apply technology to standardized processes and data in order to automate and accelerate production. The same is not so easily accomplished with Project Businesses with their unique products and non-standard business practices.


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So why is Project Business important? In order to have an impact on Project Business and improve productivity, it’s critical to think of your business as a Project Business in the first place – like Retail or Manufacturing. Once you do that, it’s easier to see how you can improve. In my >>Next Blog<<, I’ll discuss why identifying as a Project Business is key to expansion, growth and profitability.

About the author

Daniel Bevort

CEO of ADEACA - Daniel founded ADEACA in 2007 to address the needs of project-driven organizations who were lacking a holistic solution for project and financial management. As one of the principal architects behind Microsoft Dynamics AX, Daniel was in a unique position to recognize the best way to fulfill this need was inside the ERP. ADEACA was born.

Prior to founding ADEACA, Daniel was a principal architect and product director of Axapta at Damgaard Data, which was acquired by Microsoft in 2002 and later became Dynamics AX and now called Microsoft Dynamics 365 Operations. His experience at Damgaard equipped him with the skills to create user-centric software, an art form not practiced by the large, generic ERP companies.