What is the market size and value of project management?

03 June 2019 Consultancy.eu

For years, the contribution of project management to the economy has remained shrouded in mystery. In a bid to change this, the industry’s body in the UK commissioned PwC to shed light on the matter, with the firm finding that project management is in fact worth more than the entire financial services sector.

From the construction of a mega infrastructure project, to a cultural change programme at a multinational, or the implementation of an application at a small enterprise, every business relies to some extent on project management. Despite the growing need for project management in this rapidly changing world, however, until now there was strangely very little data available on the market size of programme and project management activity.

As public and private discourse continues to demand value for money when it comes to spending on external experts, the APM – UK’s professional body for project management (with 28,000 individual members the largest organisation of its kind in Europe) – took steps to demonstrate the true value of its industry. To do this, consultants from PwC were called in to assess the economic value of project management.Gross value added to UK economy

The key finding of the subsequent report is that the profession makes a more significant contribution to the UK economy than the financial services sector. With 2.13 million full-time equivalent workers (FTEs) employed in the UK project management sector, it generates a staggering £156.5 billion of annual gross value added (GVA), far outpacing the financial services sector, which contributes £115 billion, or the construction industry, which adds £113 billion.

It would be wrong to see these firms as competing against one another – they are interlinked to the extent the financial and professional services, construction and healthcare industries make up almost two-thirds of the total project management gross value added. However, this also means that project management leads to significant value gains within finance and construction.

Who is a ‘project manager’?

To come to its conclusion, PwC’s researchers leveraged detailed models to map out the value of project management activity. The analysts ultimately came to define relevant ‘projects’ as “temporary, non-routine endeavours or rolling programmes of change designed to produce a distinct product, service or end result… [With] a defined beginning and end, a specific scope, a ring-fenced budget, [and] an identified and potentially dedicated team with a project manager in charge.”

Gross value added of project management profession

Building on this, PwC then outlined what the act of project management is. Accordingly, the firm concluded that this boiled down to applying “processes, methods, knowledge, skills and experience” so that clients can meet their objectives and bring about planned outputs or outcomes. This includes “initiating the project, planning, executing, controlling, quality assuring and closing the work of an identified and dedicated team according to a specified budget and timeframe.”

While the value added by the industry could be argued as being extremely broad, according to this definition, it should be noted that the profession is not exclusive to only roles explicitly labelled as ‘project manager’. Roles can have very different titles, from the self-explanatory contract managers of procurement, or the campaign managers of advertising, to the likes of festival co-ordinators in the events sector, and many more. This means that any role where specialist project management skills are used contributes to the value add of project management.

Commenting on the findings, Debbie Dore, APM’s chief executive said, “Project management runs as a ‘golden thread’ through businesses, helping to develop new services, driving strategic change and sector-wide reform.”

For more information on the study, see the article 'Project management industry adds £156 billion of value to UK economy'.