What is project management software?

Project management software  is now an umbrella term, encompassing a range of solutions from lighter work management tools up to robust portfolio management solutions. It's important to understand the differences between these types of software so you can choose the tool that best meets your needs.

• Work management software helps teams manage workflows, organize tasks and activities, and collaborate in a shared workspace. These tools capture work execution, facilitate collaboration, and provide status updates and views relevant to different stakeholders. Their target user is non-technical business professionals.
• True PM software helps project managers and organizations execute projects - unique initiatives with a set scope, timeline, budget and/or resources. These tools help businesses plan, monitor, and control costs, schedules, and resources so they can deliver value and meet project success criteria. Their target user is technical professionals, i.e., project managers.

Capterra's project management directory lists both collaborative work management tools and more traditional project management solutions, as well as best-of-breed tools within each of these categories (e.g., task management, resource management, etc.). 

The benefits of project management tools

• Better collaboration:  Projects often require collaboration between multiple stakeholders including team members, other teams, and external clients. Project management software enables effective collaboration to allow teams to quickly respond to project challenges and requests, as well as brainstorm on process improvement.
• Streamlined project management processes:  Project management software offers the ability to create tasks, assign them to people, and track the status using dashboards. Real-time file sharing and collaboration tools save time. Business leaders have better control of their processes and can track project performance across different departments.
• Accurate budget management:  Project management software helps businesses track estimated vs. actual budgets so they can proactively identify and address areas that exceed the budget.

Typical features of project management software

• Collaboration tools:  Manage communication both within the team and externally. Some systems also provide built-in messaging tools.
• File sharing:  Upload different types of files such as documents, images, and spreadsheets, and share them with teammates.
• Project tracking:  Track the real-time progress of a project on dashboards. Some software features Gantt Charts for tracking multiple stages of a project.
• Product planning:  Create and implement product strategies.
• Task management:  Create tasks, assign them to people, and work together on the action items.
• Track completion rates:  Manually log the percentage of a task completed, which helps users calculate the total time required for completion.
• Resource management:  Allocate resources in a project including team workers, contract workers, and physical inventories.
• Time and expense tracking:  Log the total time and money spent on a project and compare it with allocated budgets.

Considerations when purchasing project management tools

• Cloud-based vs. on-premise:  Cloud-based and on-premise project management tools vary in a number of ways. An on-premise system incurs capital expenses, which includes one-time installation cost and update costs. On the other hand, a cloud-based software offers subscription pricing model, which usually incurs monthly or annual costs. Also, a cloud-based solution provides ease of access as users can remotely login from their devices using web browsers or mobile apps. Buyers should assess their requirements and make purchase decisions accordingly.
• Total cost of ownership:  Apart from the pricing mentioned on the product website, there are often additional costs related to purchasing a project management system. These can include training, implementation, and future upgrades. Before making a software purchase, buyers should consider the total cost of ownership .
• Feature requirements:  Some project management system features are suited to specific business needs. For example, a Gantt chart is a project planning and tracking tool that helps users track the status of tasks across multiple stages of the project. Issue tracking is another useful feature that helps users track customer issues, technical bugs, and error reports. Users with such specific needs should evaluate products that include these features. Capterra's project management software directory allows you to search for software by desired features, such as Agile methodologies, Kanban boards, and milestone tracking.

Relevant project management software trends

• AI-enabled chatbots are entering the project management software space:  Chatbots are conversational user-interface technologies that help users automate project management system processes such as scheduling meetings and pulling up reports. This allows users to automate repetitive administrative tasks, making processes more efficient.
• Social collaboration tools are on the rise:  With evolving customer needs, businesses are constantly searching for innovative ways of working. A social collaboration solution offers features such as hashtags and "@" mentions, which allow team members to interact faster and better. A Gartner report states that "employees are increasingly using social collaboration tools rather than formal project management products to keep their projects on track".