The Rise of the Project Economy
Over the last decade, industry experts have been predicting a major paradigm shift from traditional working structures to a more project-based approach. Read our guide to learn more about what role the rise of the Project Economy will play in the Future of Work.
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What is a Project? 3 Definitions
- “All projects are a temporary effort to create value through a unique product, service or result. All projects have a beginning and an end. They have a team, a budget, a schedule and a set of expectations the team needs to meet. Each project is unique and differs from routine operations—the ongoing activities of an organization—because projects reach a conclusion once the goal is achieved.” (Source: Project Management Institute)
- “A project is a unique, transient endeavour, undertaken to achieve planned objectives, which could be defined in terms of outputs, outcomes or benefits. A project is usually deemed to be a success if it achieves the objectives according to their acceptance criteria, within an agreed timescale and budget. Time, cost and quality are the building blocks of every project. “ (Source: Association for Project Management)
- “Simply put, a project is a series of tasks that need to be completed to reach a specific outcome. A project can also be defined as a set of inputs and outputs required to achieve a particular goal. Projects can range from simple to complex and can be managed by one person or a hundred. Projects are often described and delegated by a manager or executive. They go over their expectations and goals, and it’s up to the team to manage logistics and execute the project on time. Sometimes deadlines can be given. For good project productivity, some teams break it up into individual tasks to manage accountability and utilize team strengths.” (Source: Wrike)
What is the Project Economy?
“The Project Economy is one in which people have the skills and capabilities they need to turn ideas into reality. It is where organizations deliver value to stakeholders through successful completion of projects, delivery of products and alignment to value streams. And all of these initiatives deliver financial and societal value.”
(Source: Project Management Institute)
Described by the Project Management Institute (PMI) as a “fundamental paradigm shift”, the Project Economy has emerged in response to the ever-growing digitalisation and globalisation of the market. As organisations seek to become more agile and innovative, the use of discrete, defined initiatives (i.e. projects) allows them to structure work in a rapid, low-risk and cost-effective way.
The Rise of the Project Economy
- Nearly 80% of executives agree that the future of work will be project-based rather than role-based.
- The Project Economy accounts for more than 85% of all high skilled independent contractors.
- The PMI has forecast that project-based economic activity will grow 68% from US$12 trillion in 2013 to $20.2 trillion in 2027.
- Employers will need 87.7 million specialists working on PM-related roles by 2027.
- 89% of organisations now have at least one project management office (PMO), and 50% have more than one.
- 68% of respondents believe that project work will increase as part of the future of work.
What Factors Have Contributed to the Rise of the Project Economy?
“Organisations in all types of industries are finding that traditional organisational structures, including functional departments, business units and divisions set up for managing high-volume throughputs of standardised products and services and for making decisions in a relatively stable technological and market environment, are no longer adequate. In the rapidly changing and increasingly turbulent and uncertain environment they face today, organisations are finding that some sort of project organisation is better suited to the kind of one-off or temporary problems that they have to deal with.”
By adopting a project-driven mode of operations, organisations can remain competitive and agile in the fast-paced, continuously changing market of today. Yolanda Lau sums up the organisational advantage of project-based work succinctly, “With a project-based approach, you can innovate faster, quickly pulling skills internally and externally as needed. You can also operate more efficiently, dialling up and down skill-based resources by drawing on your workforce ecosystem.”
The rise of the Project Economy can also be somewhat attributed to the growing demand for flexibility among workers. One of the legacies of the Covid-19 Pandemic is that professionals are increasingly seeking out alternatives to 9-5, office-based jobs. As such, more and more people are embracing independent work in order to make the most of the added flexibility and the growth opportunities that it can provide. With larger talent pools to choose from, project-based work has become an even more appealing option for employers in 2021.
How Will the Project Economy Transform Workforce Models?
The rise of the Project Economy will revolutionise workforce model structures and have a major impact on both contract and permanent staff alike. In the Future of Work, organisations will move from a hierarchical, role-based structure to a blended model centred on an ”adaptable network of teams”.
As an increasing number of organisations move towards a project-oriented approach, we will undoubtedly see greater demand for independent contractors. For short-term projects that require specialist knowledge, organisations will need to supplement existing teams with a dynamic on-demand workforce made up of consultants, freelancers, and other contingent workers. This will allow organisations to avail of rare skillsets that their full-time employees may not possess. David Smith outlines the benefits of this mixed model:
“These workers can bring fresh ideas and broader industry knowledge into your projects that can complement and even benefit the internal teams. They can be highly motivated and even more engaged than regular full-time employees, but they want to be treated as part of the team, not as temporary resources.”
The shift towards project-based working models will also significantly affect the working lives of permanent employees. Industry experts suggest that in this new paradigm, employees will frequently move between teams as needed rather than staying in one fixed position. Josh Bersin explains:
“We have to think of companies like “Hollywood Movies” – people come together and bring their skills and abilities to projects and programs, they build and deliver the solution, and then many of them move on to the next “movie” later.”
Talent: The Key to Success in the Project Economy
In the Project Economy, the organisations that succeed will be those who can secure the right professionals at the right time. These individuals will drive the growth of the company through the successful completion of projects. In order to find the right talent at the right time, organisations will need the support of a reliable recruitment partner with access to an expansive talent pool that is suited to the specific needs of project-based organisations.
Berkley’s use of state-of-the-art technology guided by human insight makes us an ideal partner for agile organisations looking to avail of a flexible resource model. To learn more about how Berkley can support the success of your organisation, arrange a free consultation with one of our team members today.