Pick up the paper any day and you will often read of a project that is behind schedule, over budget, or in trouble. Whether it’s IT, construction, pharmaceuticals, or a major sporting event, we so often read about the problems. Bad news tends to sell; the success stories, unless large, often go unreported. This blog looks at one of the biggest challenges in project planning, and four ways that you can engage with your project clients to build better accountability, and hopefully, improve your project success rates.
The “planning fallacy” was first proposed by Daniel Kahneman and Amos Tversky in 1979 to explain the problem of failed projects. In general, we live in a world of optimists, and that’s probably a good thing. But it does mean that time and money estimates are often optimistic. And if the estimates are optimistic, our project will likely not meet the forecast; thus, by some definitions, we have a failed project.
Much has been written about how to improve the estimating process. Defining scope and estimating projects requires time. The more detailed the scope planning, the closer a good team will come to a reliable estimate. Perhaps there are times when a SWAG (sophisticated wild ass guess) is good enough for your client, though few certified project managers will recommend that approach on a real project.
While it’s obvious that a billion dollar project requires more than a million dollar project, many project experts would advocate that larger projects be broken down into discrete smaller projects and planned separately. We simply live in a world of rapid change. Time spent planning a project, while necessary, is time that can’t be spent doing the project.
Time spent finding historical, outside data is likely unnecessary on smaller projects, but might be quite useful on larger projects. Estimating done by an IT team in a time constrained session may be just as reliable as estimating done by one person after pouring over the code. The objective is to do what is necessary to achieve a reliable estimate, and nothing more.
If you are working with clients who pay for your services on an hourly basis, it is important to be clear with them that estimates are just that – estimates.
What are the ways that a strong client engagement can help build accountability and improve project success?
Break down the project scope into discrete activities and review with the client.
Clearly define the necessary details on those activities. This does not mean that the team needs to identify every single piece of work at the beginning. That could take days or weeks. Understand the big activities before estimating costs. This includes knowing who will do what pieces of the work, what might be outsourced, what “done” looks like for each activity, and what risks are there. Review this with the client to ensure that nothing has been missed.
Engage your client by periodically discussing progress.
Clients may not know HOW to do the project that they have engaged you to do, but they know plenty about what they want. By frequently communicating progress on an activity-by-activity basis, and better understanding your client’s wants and needs, you can adjust, when needed, without spending unnecessary sums.
Enlist the client’s assistance to identify risks.
The client often knows things about the project that you don’t know. Ask questions, early and often, to better understand the risks that face your project.
Review the money that’s been spent on the project with the client periodically.
That’s not the same as sending a bill, though that needs to be done. You can consider including a message with your bill that tells the client what value has been delivered. Consider inviting your client to an occasional project meeting. Think about your communications from the client’s perspective. What value did you provide your client?
Teams that do work for outside clients inevitably face the question of how much transparency there should be in client interactions. Many team members may balk at transparency, as it provides little room to hide. If you provide your project estimates broken down by activities, the client may hold you to that estimate. Clearly, in a larger project with lots of places to make up time and money, having to be accountable to the client at the individual activity level is a pain. Yet sometimes that kind of accountability can be good for teams and the individuals on them.
Estimates, quotes, forecasts, and budgets… they are more than a sophisticated guess. They should be reliable, given what you know at the time. They may need to be revised. But they are still estimates. Reasonable clients understand this, and may be more willing to engage if you are transparent.
Do your project teams need some coaching? Schedule a call to discuss your needs.