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According to a recent study done by Software Advice, about 46 percent of small businesses are still using manual methods in organizing and tracking their projects. Small businesses still occupy the majority of the economy compared to big corporations. For example, in the US alone, about 54 percent of all country sales come from small businesses. However, the study done by Software Advice from the interactions they have from 385 small-business buyers showed interesting information about the kind of project management software small businesses are looking to buy.
The Current Picture
According to the study, about 46 percent of small enterprises are still using different kinds of manual methods in managing their projects. Some of these methods are using pen and paper, email and spreadsheets. Business owners have realized that these methods are more prone to error, so they are now looking for project management software to replace these outdated methods. It is also interesting to note that about 9 percent of the respondents showed that they use non-PM software, such as accounting programs and time tracking applications. However, these do not address what they really need in order to successfully manage their projects, such as providing the needed overall visibility and analytical reports.
Web-based Preference
The majority of the small-business buyers that were interviewed, or about 75 percent, do not have a particular preference in how the project management software they need should be deployed. However, the one-fourth that indicated a preference explicitly chose to have a web-based deployment. The popularity of web-based software has risen notably over the last few years. Combining that with the simplicity of signing up for a monthly subscription, the choice of small-business buyers who do not want huge capital expenses is clear.
Integrated Suite Selection
Project management software available today can be generally classified as either best-of-breed or integrated suite. A best-of-breed application is a standalone that specializes in one particular thing, such as task management, for instance. Integrated suite applications are set of applications offered that can have two or more functionality, such as task management, Gantt charting, and time tracking all together. About 88 percent of the buyers would rather select an integrated suite to keep to a minimum the different platforms being used to manage projects. Consolidation over specialization is given priority.
Top Reasons for Purchase
Buyers overwhelmingly want a project management software, about 98 percent of the respondents. Time tracking software at 66 percent came a distant second. However, the reasons why buyers want a PM software are more diverse. About 41 percent stated that an improvement in efficiency and accuracy is what they are looking for. Again, this is not surprising, considering that many are looking for an alternative to manual methods that are inefficient and prone to error. A close second of 32 percent of buyers are looking for greater functionality, which may indicate that the business has outgrown its tools for managing projects.
Buyers by Business Role
The study also differentiated the buyers by the role they have in their business. The chart showed that about 43 percent of the buyers have business leadership roles rather than project management role or IT role. Indeed, it was the senior managers, department directors, CEOs and owners that have shown interest to purchase PM software. But this is typical for small businesses that have fewer employees, but also a growing trend that not only project managers are managing projects. This also reflects a trend that PM software is now being used across industries. The chart also showed that the second highest types of buyers are project manager, which are at 21 percent.
Buyers by Company Size, Annual Revenue, and Industry
The sample of 385 small-business buyers used by Software Advice is made up of a 64-percent majority with a company size of 1 to 50 employees. A business with fewer employees would want a higher degree of efficiency, so a web-based, integrated project management software is an ideal choice to provide a broad array of functions with the simplicity and affordability of an online software. The next group of buyers has an employee size between 101 and 500, which can describe a company experiencing growth and expansion. In terms of annual revenue, 30 percent of the buyers report a revenue between 1 million and 5 million dollars. In terms of industry, 21 percent are in the technology sector, and 15 percent each come from the public service, the industrial, and the marketing/advertising sectors.
Study Methodology
Software Advice consultants help people find the right software for their organization. The original study was made by randomly selecting 385 of their interactions with small-business buyers. For a further discussion of their report, you can visit their website and contact the managing editor.
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