Project management marketing 101

marketing the project manager

Abstract

Significant energy is currently being devoted to the topic of marketing project management to senior executives. Such work generally presumes that project management would significantly enhance an organization's ability to achieve its objectives but that senior management is unaware of its inherent value. Further, it is often assumed the key to addressing this education gap is for project managers to learn to communicate in the language of senior executives.

While these assumptions may be broadly applicable, in many cases, failure to communicate is not the problem. Often, well-intentioned behaviors by project managers paradoxically convince executives that project management is at least unnecessary overhead, and perhaps even a barrier to achieving the organization's objectives. Even when project managers successfully demonstrate their value, they can reinforce the notion that project management is a tactical activity, not a discipline that can be applied productively at all levels of the organization.

As project managers, we know these perceptions are wrong. We also know that people usually draw conclusions about a profession from the examples they see. And so while we can, and should, expect the Project Management Institute (PMI®) to market project management globally, we also have a responsibility to market project management within our own organizations by marketing individual project managers: ourselves.

Drawing on his considerable experience working with senior executives in a global consumer products company, the presenter will highlight examples of well-intentioned behaviors that nonetheless obscure the value of project management. He will then provide a series of practical recommendations for exposing opportunities to market both the project manager and the discipline of project management.

Introduction

“Selling project management to senior executives” consistently shows up as a top concern of project managers. In a technical needs assessment conducted for PMI by Monalco Market Research & Information Management (2002), the most selected area for PMI research and development was “selling project management to senior executives” followed by the related area of “project management linkage with strategic planning”. The participants in PMI's Research Conference 2002 (Project Management Institute, 2002) submitted “ideas for research” that included:

  • Selling project management to senior executives
  • Value/return on investment of project management
  • Linking strategy and project management
  • Project management linkage with strategic planning

The subject is not being ignored. PMI has funded several research projects, including a study by Janice Thomas of the Centre for Innovative Management at Athabasca University on “Selling Project Management to Senior Executives” (Thomas, Jugdev & Delisle, 2002) and an earlier study by William Ibbs of the University of California at Berkeley's Project Management Group on “Quantifying the Value of Project Management” (Ibbs & Reginato, 2002). Others are pursuing the same subject independently, most notably the Center for Business Practices (Oswald & Pennypacker, 2002).

Nevertheless, in spite of a growing library of marketing materials and “how to” articles, project managers are apparently still feeling undervalued. And the acceptance of project management within an individual organization continues to wax and wane as crises come and go.

Our failure to sell project management to senior executives is often attributed to a failure to speak the language of senior executives. While there may be some truth to this in individual cases, it does not explain why the problem is so ubiquitous. Selling skills can be learned or purchased. Why then has somebody not discovered the silver bullet we seem to be missing? Is there something at work here besides a dearth of selling skills within the project management profession?

If we reject the notion that project managers are inherently poor sales people, there must be a more subtle reason our message is not being heard. Three possibilities are evident:

  • Our claims do no not match the observed results.
  • We are selling a product that does not address the need.
  • We promise results, but substitute bureaucracy for effective processes.

Our claims do no not match the observed results

There is little doubt that project management is generally not delivering the results it promises. The Chaos Report (1994) (The Standish Group, 1994), stating that only 16.2% of software projects are completed on-time and on-budget, has been widely cited. Colby and Gothard (2002) report a study by Robbins-Gioia Inc. in which 44% of participants reported projects with cost overruns of 10% to 40%. And Cooke-Davies (2001) analyzed 136 (mainly) European projects executed between 1994 and 2000 and found that the mean performance against budget was a 4% cost escalation while mean schedule performance was 16% late.

It can be argued that we are improving, of course. The 2001 update to the Chaos Report (The Standish Group, 2001) reported considerable improvement. Between 1994 and 2000, schedule performance on IT projects improved from an average overrun of 222% to 63%, and cost performance improved from 189% to 45%. Overall, the success rate improved to 28%. This is clearly worth celebrating. But a profession that promises to deliver projects “on time and under budget” can hardly be proud of a 28% success rate. And senior executives are not fools. While they probably do not have the Chaos Report at their fingertips, they are undoubtedly cognizant of a considerable gap between our claims and the dismal reality.

Project managers will argue these depressing results represent not a failure of project management, but a failure to apply project management effectively. This argument certainly has intuitive merit. But the evidence supporting this claim is unconvincing. Two studies illustrate different approaches to this question, and to the difficulty of establishing compelling data.

Ibbs & Reginato (2002) studied 52 organizations attempting to correlate qualitative data with project management maturity. They report the following findings:

  1. Companies with more project management practices have better project performance.
  2. Project management maturity is strongly correlated with more predictable project management schedule and cost performance.
  3. Good project management companies have lower direct costs than poor project management companies.

These findings are significant, of course, and represent an important step forward in quantifying the value of project management. But they leave some important unanswered questions:

  • Findings 1 and 2 relate to cost performance index and schedule performance index, which in turn are based on baseline cost and schedule estimates. How much of the improvement reflects better performance, and how much simply reflects better estimates?
  • How much project management is enough? Assuming an organization has many internal improvement opportunities, all competing for scarce resources, what level of project management maturity is optimum?

Crawford & Pennypacker (2001) used a balanced scorecard approach to survey 103 senior practitioners with knowledge of their organizations' project management practices and their organizations' business results. Again, the results seem very encouraging. The respondents reported positive improvement in every category, including financial measures, after implementing project management initiatives. Significantly, they report an 88% improvement in Return on Investment. But the study raises similar questions. While it is clear that implementing more discipline in the management of projects can yield significant improvement, how much is enough? Are there specific practices that are more important than others, and are these the same for every organization?

Clearly, these studies are important and represent a big step forward in quantifying the value of project management. But from a senior executive's perspective, they are unlikely to be convincing. And even if they deem the findings applicable to their specific organization, these studies do not answer the question: Is this the best investment for the limited resources available to me at this time?

We are selling a product that does not address the need

A fundamental premise of any sale is that the purchaser buys to address an unmet need. Successful marketers, like The Procter & Gamble Company invest enormously to convince consumers they need fresh-scented clothes, less dandruff, and whiter teeth. When the consumer becomes convinced, the sale is inevitable. Applying this premise to project management, it becomes important to ask if we are selling a product that addresses an unmet need of senior executives. More pertinently, are senior executives convinced they need project management?

The dilemma in answering this question is that project management is generally perceived to be a methodology to achieve cost and schedule goals. While this narrow approach is not promulgated by PMI's A Guide to the Project Management Body of Knowledge (PMBOK® Guide) (PMI, 2004), it is enshrined in the literature (Pinto & Slevin, 1998, p.67), and taught in popular textbooks (Schwalbe, 2004, pp. 5–7; Meredith & Mantel, 2003, pp. 78–85).

However, cost and schedule performance is often not uppermost in a senior executive's mind. Consider the following examples culled from the literature and the author's experience.

  1. 2002 Olympic Winter Games. The 2002 Olympic Winter Games was a very successful project from a project management perspective, winning designation as PMI's 2003 International Project of the Year (Foti, 2004). It achieved the key dates, of course. But it deviated from the conventional approach to “success” with respect to its cost performance. The project managers boast that they turned a $100 million deficit into a $400 million surplus, not just by eliminating “nice-to-have” items, but by also securing additional funds. Clearly, success was measured by profitability, not by achieving a specific cost target.
  2. Batu Hijau Copper Concentrator. PT Newmont Nusa Tenggara's Batu Hijau copper concentrator was the world's largest “greenfield” startup when it was commissioned in September 1999 (Enos & Rogers, 2002). It was an extremely complex construction project located on the remote Indonesian island of Sumbawa involving 1,704,000 design hours, 48,791,000 construction hours, 551 separate systems, and 19,200 engineering drawings and documents. Nevertheless, it was completed one month ahead of schedule and $100 million under budget. It was considered very successful, but not merely because of its cost and schedule performance. Rather, it was viewed as successful because the production ramp-up was faster than expected, producing a cash flow from operations exceeding 200% of budget within a year after start-up. In this case, the project team focused on the real objective which was to produce copper concentrate, not to achieve the cost and schedule targets.
  3. Project Orion. This massive effort to develop Kodak's new Advantix photographic system was reputedly very well managed from a project management perspective. PMI recognized it as the 1997 International Project of the Year, and Business Week selected the system as one of the best new products of 1996 (Adams, 1998). But Kodak's stock price has fallen 67% since the introduction of the Advantix system, in part because it failed to anticipate the accelerating switch to digital photography (Bandler, 2003).
  4. Manufacturing Plant Optimization. A paper manufacturing company with five plants across North America decided to increase its manufacturing capacity by embarking on a debottlenecking program. A project team was formed to install the necessary equipment, and charged with completing the work in 18 months at a cost of $26 million. But almost immediately, the project team was asked to defer major expenditures until an unrelated cash flow problem was resolved. Rather than stop work completely, the team adopted a strategy of prototyping the technologies on which the debottlenecking program was based, and actually developed some cheaper and more effective solutions. Even when the project was authorized to proceed, the team continued this same approach. The project eventually spanned five years, but the resulting capacity increase was three times the initial commitment. Not surprisingly, the company immediately appropriated another $40 million to continue the program.

The anecdotal conclusions from this small sample of case studies are supported by a growing body of research. For example, Shenhar, Levy and Dvir (1997) propose a multidimensional framework of project success, incorporating four success dimensions:

  • Project efficiency
  • Impact on customer
  • Business success
  • Preparing for the future

Morris (2003), in a keynote address to the 17th World Congress on Project Management, concludes: “The result is that while project management has historically been seen within a well-defined context of executing a task ‘on time, in budget, to scope' it is increasingly being seen that it has to operate within a much broader, and subtler environment.”

There are times when cost and schedule targets are important, of course. An obvious example is when they are required by contractual obligations. Other examples include the production of a component needed on a specific date for assembly with other components, and preparation for a date-certain event such as the Olympic Games or celebration of a national holiday. In such cases, cost and schedule performance are critical to the organizational success and will be important to the senior executives.

Frequently, however, targets stated as a specific cost or a specific date are really better expressed as “as cheap as possible” or “as soon as possible”. For example, the key to successful new product introduction is often being first to market. Therefore, in a competitive situation, a company will often be willing to invest more for a faster schedule. Conversely, when productivity or efficiency improvement is the goal, an earlier start-up may or may not be a good investment, depending on the relative costs and savings. Nevertheless, a project management process focused rigidly on fixed date would be unlikely to excite any senior executive.

Clearly, it is important to realize that senior executives are not necessarily looking for better cost and schedule performance, and if project management is seen as simply a means to achieve cost and schedule targets, we will find ourselves selling a product of questionable value.

We promise results, but substitute bureaucracy for effective processes

One of the most pervasive liabilities of project management is that it is perceived to be expensive and unnecessary overhead. And regrettably, this reputation is well-deserved. It is an inevitable result of the typical implementation cycle.

A team is charged with developing the procedures and templates to “implement project management”. With the best of intentions, the team develops a process to accommodate the most complex project the organization is ever likely to encounter. In many cases, the decision to implement project management is precipitated by a crisis, and this increases the commitment to rigor, exacerbating the problem. The team's mindset is to design a process to guarantee that particular crisis “will never happen again”. Then, having established a process to accommodate projects of rare complexity, the team declares that “common sense” is to be used in applying the process to simpler projects.

The problem is that the optional parts of the process are rarely identified, and the entire organization defaults to meticulous compliance with the entire process. Eventually the memory of the crisis fades away, as does the mythical “highly complex” project, and senior management sees only the costs associated with bureaucratic minutiae they believe to be “project management”. It is not, of course, but the opportunity to educate a senior executive has usually long passed when the cost cutting begins.

Addressing this subject, Tony Crawford (2004) writes: “Can there be too much methodology? I think the answer to that question is also “yes”. I have seen methodologies evolve in several organizations from very little to a maze of methodologies – all mandated for every project, in a futile attempt by senior management to ensure project success – and to the point where rather than helping, they too often inhibit project success.”

A similar cycle often occurs when the introduction of project management involves the implementation of enterprise project management software. Management is initially enthralled with the colorful screens promising instant information about any project in the portfolio. However, providing such information inevitably requires diligent data entry by everybody assigned to project work, including people assigned for just a few hours a month. Soon, this translates to increased staff and significantly higher costs. Eventually, the reasons for implementing the enterprise project management software are forgotten, and once again, senior management sees only the costs associated with a white elephant they mistakenly suppose to be “project management”.

Recommendations

These problems are broad. They are symptomatic not just of individual organizations, but of project management globally. And they require global solutions. Nevertheless, senior executives, like people everywhere, draw their conclusions about a profession from the examples they see, and so we all have a part to play. And while we can, and should, expect PMI to market project management globally, we also have a responsibility to market it within our own organizations by effectively marketing the one element of the profession we can uniquely control: ourselves.

A key first step is to understand the goals of the senior executives leading our organization. In effective organizations, the reward structure for senior executives will be aligned to key organizational targets, and their individual goals will be congruent with the organizational goals. In rare instances, these organizational goals will include the cost and schedule performance of major corporate projects. More often, they will be financial measures like revenue, profit, and shareholder value.

A second step is to understand why our specific project was selected. Projects are never selected because of their cost and schedule targets. They are selected because they contribute to important organizational objectives. They may be intended to increase revenue, or reduce costs, or they may enhance shareholder value because of a high return on investment.

We then need to position our projects to achieve, and even exceed, the contribution assumed during the selection process. If the project was intended to increase revenue, we should be asking: “How can I add even more revenue?” If it was intended to reduce costs, we should be asking: “How can I reduce costs even further?” And if its purpose was to get a new product to market ahead of the competition, we should be asking: “How can I launch the product even sooner?”

The answers to questions like these will drive project managers to some atypical behavior. They may find themselves offering management a faster schedule at a higher cost. They may find themselves recommending additional scope at higher cost. They may find themselves suggesting a scope reduction even in the absence of cost pressures. Some brave project managers will find and offer opportunities to delay their own projects while redeploying resources to projects with a bigger impact on the organization's objectives. And a few extremely audacious project managers will recognize their projects are no longer a good investment and will recommend cancellation.

These are not behaviors described in traditional project management textbooks. But they are behaviors that drive organizational success. And while these project managers may never win the “project manager of the year” award, they will win the attention of senior executives, and greatly enhance the reputation of project management at the same time.

SPIN® Selling Project Management

In his popular book entitled “SPIN Selling”, Neil Rackham (1988) describes the typical sales process as involving four steps:

  1. Preliminaries
  2. Investigating
  3. Demonstrating Capability
  4. Obtaining Commitment

In minor sales, used cars for example, “Obtaining Commitment” is considered the most important. Sales people call it the “close” and often cite the mantra: “If you can't close, you can't sell”.

However, Rackham postulates that major sales are different. Based on his researchers' observation of more than 35,000 sales calls over a period of 12 years, he asserts the most important step in successful major sales is “Investigating”.

Selling project management to senior executives is not selling used cars. We cannot expect success jumping from “Preliminaries” to “Obtaining Commitment” in a single sales call. Success will require patient, and often arduous, attention to the intermediate phases of “Investigating” and “Demonstrating Capability”.

References

Adams, C. (1998, January). A Kodak moment: Advantix named 1997 international project of the year. PM Network, 12 (1), pp. 21–27.

Bandler, J. (2003, July 24). Kodak's net falls 61%, hurt by switch to digital. The Wall Street Journal, 242 (17) B86.

Colby, S. and Gothard, B. (2002). The enterprise project life cycle – integrating project management into the business. Proceedings of the Project Management Institute Annual Seminars & Symposium (San Antonio, Texas). Newtown Square, Pennsylvania: Project Management Institute.

Cooke-Davies, T. (2001). The “real” success factors on projects. Proceedings of the 4th European Project Management Conference. London: PMI Europe 2001.

Crawford, J.K. & Pennypacker, J.S. (2001). The value of project management: proof at last. Proceedings of the Project Management Institute Annual Seminars & Symposium (Nashville, Tennessee). Newtown Square, Pennsylvania: Project Management Institute.

Crawford, T. (2004). Project management methodologies - are they really a “good thing”? Retrieved April 7, 2005, from the pmforum.org web site: http://www.pmforum.org/pmwt/archives/pmwt04/viewpoints04-1112more.htm

Enos, T. and Rogers, T. (2002). Batu Hijau: great challenges and achievements. Presentation at PMI Global Assembly, 6 October 2002, San Antonio, Texas, USA.

Foti, R. (2004, January). The best winter Olympics, period. PM Network, 18 (1), pp. 23–28.

Ibbs, W. & Reginato, J. (2002). Quantifying the value of project management. Newtown Square, Pennsylvania: Project Management Institute.

Meredith, J. & Mantel, S. (2003). Project management: a managerial approach. New York: John Wiley & Sons.

Monalco Market Research & Information Management. (2002). Technical needs assessment 2002 key findings. Retrieved April 7, 2005, from the Project Management Institute web site: http://www.pmi.org/info/PP_TNAkeyfind02.pdf

Morris, P. (2003). The irrelevance of project management as a professional discipline. Proceedings of the 17th World Congress on Project Management (Moscow, Russia). Moscow: Russian Project Management Association.

Oswald, J. & Pennypacker, J.S. (2002). The value of project management: the business case for implementation of project management initiatives. Proceedings of the Project Management Institute Annual Seminars & Symposium (San Antonio, Texas). Newtown Square, Pennsylvania: Project Management Institute.

Pinto, J.K. & Slevin, D.P. (1998, September). Project success: definitions and measurement techniques. Project Management Journal, 19 (3), pp. 67–73.

Project Management Institute. (2002). Ideas for research. Retrieved April 7, 2005, from the Project Management Institute web site: http://www.pmi.org/info/PP_PotentialResearchTopics.asp

Project Management Institute. (2004). A guide to the project management body of knowledge – Third Edition (PMBOK®). Newtown Square, Pennsylvania: Project Management Institute.

Rackham, N. (1988). SPIN Selling. New York: McGraw-Hill Book Company.

Shenhar, A., Levy, O. & Dvir, D. (1997, June). Mapping the dimensions of project success. Project Management Journal, 28 (2), pp. 5–13.

The Standish Group. (1994). The CHAOS Report (1994). Retrieved February 28, 2004, from The Standish Group web site: http://standishgroup.com/sample_research/chaos_1994_1.php

The Standish Group. (2001). Extreme CHAOS (2001). Retrieved April 7, 2005, from The Standish Group web site: http://www.standishgroup.com/sample_research/PDFpages/extreme_chaos.pdf

Schwalbe, K. (2004). Information technology project management. Boston: Thomson Course Technology.

Thomas, J.L., Jugdev, K. & Delisle, C.L. (2002). Framing the moves that matter: selling project management to executives, phase III. Proceedings of the Project Management Institute Annual Seminars & Symposium (San Antonio, Texas). Newtown Square, Pennsylvania: Project Management Institute.

This material has been reproduced with the permission of the copyright owner. Unauthorized reproduction of this material is strictly prohibited. For permission to reproduce this material, please contact PMI or any listed author.

© 2005 Hugh Woodward
Originally published as a part of 2005 PMI Global Congress Proceedings – Edinburgh, Scotland

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