Project management can be the difference between success and failure, not to mention profit and loss. In fact, organizations that use proven project management practices waste 28 times less money than companies that don't. Using proven, well-known methodologies will also help increase the time to market for critical products.

Here's a breakdown of the methodologies that project management experts believe every software company should know about:

1. Agile

Agile is a methodology that breaks projects down into short sprints. Erin Witte, a senior digital producer at Union explained that this makes the method "flexible enough so that you can create iterative tasks and then adapt based on the situation." This means companies can adjust their course quickly and react faster to market changes.

On the other hand, agile projects aren't entirely pre-planned, so it's much more difficult to predict the outcome. "Agile is best suited for projects like software development with technology that moves at too quick of a pace for you to wait and adjust (like with Waterfall)," said Witte. Agile is best for companies that need to adapt to changes in technology and customer demand.

Related Article: When to Use Agile vs. Waterfall for Your Next Project

2. Waterfall

Waterfall is the more traditional approach to project management. "In contrast to agile, the Waterfall methodology allows you to plan out the project in full before completing each linear stage," said Witte. All the project requirements are defined at the outset, and each stage depends on completion of the previous phase, so there are more predictable outcomes than methodologies that make frequent adjustments along the way.

Waterfall, however, isn't without its challenges. "There tends to be a lot of change in scope requests with Waterfall," said Witte. For many projects, especially software development, it's too hard to determine expectations and plan everything upfront. That’s why in an age of continuous delivery and continuous deployment, Waterfall is becoming more outdated for tech companies.

3. Hybrid

The hybrid approach is a combination of the agile and Waterfall methodologies. According to Witte, hybrid "takes the proactive planning of Waterfall and the adaptable structure of agile to create a project management method that's the best of both." Hybrid is best for projects with a firm budget that need some adjustments along the way to reach the desired outcome. 

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With software companies, for example, the outcome can be planned with a Waterfall approach, but the execution and delivery can have an agile approach. That way, the development team can ship an MVP quickly, and then continue working towards the full project scope. Hybrid is a flexible approach that allows you to adapt to meet strict client deadlines and budgets.

4. Scrum

Scrum is an extension of the agile methodology that revolves around a self-organizing small team led by a scrum master. "Scrum is great because it's a democratic and system-driven way to eat an elephant one bite at a time," explained Matt Eonta, senior manager, project management at HubSpot. Projects are broken down into smaller tasks and timeboxed at the granular level for better project planning and estimating. 

On a higher level, Scrum encourages team collaboration and transparency through meetings — or "ceremonies" — like "task grooming, task planning, demos, retrospectives and daily team stand-ups," said Eonta. In fact, many of these meetings are beneficial even if teams aren't following the scrum approach. With so much collaboration, many project managers feel that Scrum works best when teams are co-located, but Eonta doesn't necessarily agree. "In my experience, teleconferencing and other virtual meeting tools enable Scrum to work efficiently regardless of where team members live," he said.

5. Kanban

Kanban is an approach that's similar to Agile and Scrum, but focused on visualization and limiting the work-in-progress to avoid overburdening teams. "When you use KanBan, every task has discreet, easily-understood and categorized stopping points on its way from new idea to finished product," said Eonta.

The visual aspect of this approach is the KanBan board — a series of tasks cards that fall under columns to track their progress towards completion. Using the Kanban board, Eonta said, "can really rally teams and keep them all on the same page easily." As long as the tasks and steps are streamlined and straightforward, Kanban boards can help manage nearly any type of project efficiently.

The essential thing to remember is that projects can follow any combination of these approaches. Many of the methodologies, for example, are variations and extensions of Agile, so it's a matter of finding what works best for your team and its goals. The worst thing a software company can do, however, is not follow a project management methodology at all.