Download Commercial Project Management a Guide for Selling and Delivering Professional Services PDF

TitleCommercial Project Management a Guide for Selling and Delivering Professional Services
TagsProject Management Risk Sales Top Down And Bottom Up Design
File Size1.8 MB
Total Pages268
Table of Contents
                            Cover
Half Title
Title Page
Copyright Page
Contents
List of figures
List of tables
Preface
Acknowledgments
1 A summary of the guide
	Intended audience
	General scope
	Chapter synopsis
	Conclusion
2 Introduction to the business of projects
	Overview of the situation
	Project management standards have limits
	The commercial project environment
3 Buyer and vendor integration
	Impediments to unified project management
	The practice of lifecycle mapping
	Realities that impact lifecycle mapping
	Other integrative initiatives
4 Evolution of a vendor lifecycle
	Phases of the vendor lifecycle
	Outline of a vendor methodology
5 Developing organizational responsibilities
	Organizational balance
	Delivery management
	Responsibility, accountability, and authority
	The responsibility assignment matrix
	Project team structure
	Vendor organizational alternatives
6 Risk as a guiding principle for management
	Risk perspective through the vendor lifecycle
	Risk models and techniques
	The risk factor model of risk
	The risk alert model of risk
7 Overcoming estimating anxieties
	The foundation of professional estimating
	Estimating techniques
	Managing uncertainty
	Business considerations
8 Solving the quality conundrum
	The meaning of quality
	Designing a commercial response
	Modeling quality
	The quality plan
	Commitment and motivation
9 Managing the resource pool
	Hiring practice
	Essential resource metrics
	Resource planning
	Resource management
10 Finance matters
	Modeling the services business
	During the bid phase
	During the initiation phase
	During the execution phase
	During the completion phase
11 Building a successful services firm
	Introduction to core business concepts
	Augmenting the firm’s capability
12 Toward collaborative procurement of services
	Problems in the marketplace
	Proposal for total collaborative procurement
	Outline of the TCP phases
	Practice descriptions
	Implementation prerequisites
	Future development
References
Glossary
Index
                        
Document Text Contents
Page 2

Hornby’s comprehensive guidebook will be of lasting value to experienced
project managers and invaluable to those making the transition to commer-
cial or business management positions. Drawing on extensive experience in
software services, he critiques established tools and techniques, offering ad-
vice on when to follow and when to avoid or adapt. His professionalism,
mastery of the subject, but above all his plain common sense, shine through.
Hornby is sound on Risk, Estimating, and Quality. The book addresses the
crucial question: how can services companies, especially software services
companies, grow profitably and safely as the scale and number of the projects
undertaken outstrips the ability of the founder business owners to take or
even monitor every key decision? This reviewer exited profitably from two
software start-ups. Hornby’s insights on building a successful services firm
might well have inspired and enabled us to grow rather than to sell.

Dr Alan Montgomery, founder and CEO of Integral
Solutions Ltd, ISL Decision Systems Inc.

and InferMed Ltd, UK

In Commercial Project Management, Robin Hornby, a project management au-
thority and author, gives the reader a very complete view of the business
management of projects from the professional service firm’s perspective. His
tips and templates on topics such as bidding, client engagement, and risk and
quality management are practical and will help even the smallest vendor firm
win more contracts and execute them successfully. His chapter on ‘Building
a successful services firm’ is worth the price of the book alone. This is a
must-have book for any small- to medium-sized services firm that wishes to
improve their practices.

Dr Blaize Horner Reich, RBC Professor of Technology
and Innovation, Beedie School of Business,

Simon Fraser University, Canada

I don’t know of a finer framework for delivering professional services-based
projects, getting paid and making a profit, than Robin Hornby’s. We imple-
mented most of these processes and techniques presented in the book and
reaped the benefits over the long run. Over time, we organized our entire
operations around the main theme of Commercial Project Management, which
is managing through all phases of the vendor lifecycle. This is a must-read
for all who desire to implement superior commercial project management
practices.

Jacques Tremblay, Vice President
of Hexagon, Canada

It is refreshing to find in this latest book, Commercial Project Management by
Robin Hornby, a side of project management that is rarely tackled. In fact,
it is not about project management per se, but rather about how to make

Page 134

Overcoming estimating anxieties 115

though there is no substitute for personal experience and every PM should
develop their own ROTs. The following ROTs are drawn from my own
experience and may not apply in other circumstances.

Project management estimate

Three typical techniques include:

1 Estimate Based on Team Size–Allocate 1 full-time equivalent (FTE)
management resource for every 7–10 team members. Useful on large
teams and as a cross-check on the percent of e�ort method.

2 Percent of E�ort–Assess PM e�ort based on the total project e�ort esti-
mated. Small simple projects 3–5%, moderately complex projects 5–15%,
and large complex projects 15–25% (this would include a full-time ven-
dor PM and a percentage of team lead time).

3 Percent of Duration–Assess PM e�ort as a percent of the project duration.
Useful as a cross-check for smaller projects using a part-time vendor PM.
For example, a 6-month project may need 30 h/month of PM e�ort, for
a total of 180 h.

Technical and project administrative support

Support in its various forms is often overlooked, but even small percentages
can add up for large projects. The most common areas are administration,
either performed by the team themselves or by admin sta�, and technical
support. Admin support tends to range from 1% to 3% of project estimate.
Technical support is more variable, and can run from 3% to 10% of deliv-
erable estimate. Complex, technically innovative, or performance-oriented
projects tend to require more.

Other non-deliverable work

In addition to the previous categories, time may also be leaked to other areas. If
not identi�ed and estimated, a cost overrun can be anticipated. These areas in-
clude: client assistance, project meetings, coaching, travel, reviews, and rework.

Caution on productivity

For project work, output per person is not the same. It varies based on their
experience and knowledge of project technologies. Training can be used,
sometimes, to boost individual productivity but at additional cost and lost
time to the project. Time for project familiarization also reduces the produc-
tivity of new team members as they adapt to the project and meld with the
existing group. An ROT can provide a productivity factor (e.g., factor the
standard e�ort by 1.1) for sta� not meeting the average criteria.

Page 135

116 Chapter Seven

Project duration estimating

Although this chapter is primarily focused on estimation of effort, as duration
and effort enjoy a mutual interaction, this section also covers a few additional
rules that apply specifically to duration.

Classic scheduling

Classic project scheduling relies on developing an initial activity effort esti-
mate (E), then allocating resources (R). Activity duration (D) is then given
by the formula:

D = E/R.

The schedule is developed by mapping activities onto a calendar, whilst ad-
hering to activity dependencies defined in the network diagram. Resources
are not infinite, and so a process called resource leveling resolves instances of
resource overload. This process leads to the critical path.

In practice this approach is too theoretical for projects that operate in an
unpredictable client environment. Projects can operate along a critical path
under the firm’s control for a period, but these periods can be interrupted by
client-controlled situations where the firm’s resource utilization can fluctuate
unpredictably and classic schedule management breaks down.

Most vendor PMs deal with this reality by applying an experience-based
‘model schedule’ that attempts to account for planned and unplanned du-
rations. Thus, although D=E/R might apply to a vendor’s specific planned
activity durations, it is definitely not applied to the project as a whole.

To reiterate, the client has an impact on duration over which the firm has
little control. It is also hard to make an ROT, as clients are not standard.
However, if the contract has stated the need for client responsibilities, then
they can be held accountable.

Crashing the schedule

There are situations when the overall schedule is highly dependent on large
and significant activity. D = E/R applies, and crashing the schedule to ad-
vance the completion date is feasible. This means applying increased resource
levels either through adding team members or working overtime. Three
points must be observed to maintain control in this situation:

1 There must be a reliable estimate of effort available at the outset. The as-
sumptions that underpin this estimate must be reviewed for applicability
and, if necessary, the estimate updated.

2 The nature of the activity, and the current and planned additional re-
sources must be reviewed to assess whether linearity continues to apply
to the formula D=E/R. For example, an activity to build four units, with
three staff applied, is probably linear and an additional resource could be

Page 267

248 Index

profit center 10
progressive commitment 34
progressive response 47, 95
project lifecycle 14–16, 242
proof of concept 63
psychological states 152, 236

QA (Quality Assurance) 144, 148
QC (Quality Control) 144, 148
QFD (Quality Function Deployment)

135
QMC (Quality Management Council)

150–1
QMS (Quality Management System)

136–8
QP (Quality Plan) 145–6
QR (Quality Records) 149
quality 128–33; models 138–44; objectives

145; policy 142; principles 137

RAA (Responsibility Accountability
Authority) 59–62

RACI (Responsible Accountable
Consulted Informed) 65

RAM (Responsibility Assignment
Matrix) 65

rate setting 181
red review 101
Reid, Roger H. 25, 236
relationship selling 80
reporting requirements 29
reports: completion 52; corrective action

149; project accounting 188, 242;
project status 50; resource forecast 164;
resource utilization 162, 166–7

resource leveling 116
resource plan 163–5
resource utilization 166–7
response strategy 85
résumé selling 168
revenue recognition 189–92
RFP (Request for Proposal) 186–7
risk 77–8; alert 96; event 85; facet

89; factor 89; indicator 96; models
83; profile 80; rank 89; register 86;
screener 78; shared 179, 225; system
77; transference 42

rolling wave 49, 95
ROT (Rule of Thumb) 114
RTM (Requirements Traceability

Matrix) 135, 243
Russian doll 85

S-curve 120, 161, 182
sales model 68
scheduling 116, 124
semantic model 86
Shapiro, Andrea 203, 237
sign-off 194
silo 22, 215
Six Sigma 133
skill streams 170
SOP 97–2 (Statement of Position) 184
SOP (Standard Operating Procedures)

200
SOR (Statement of Role) 155
SOW (Statement of Work) 32–3;

contract schedule 187; procedures
included 19

SOX (Sarbanes Oxley) 174
stakeholders 23, 67–9
standard cost 113, 180
standard deviation 119
standards: the client’s 33, 132–3; project

management 11–12, quality 136;
RFP 187

steering committee 70
stop work order 29
structure chart 224
success criteria 42
supply management 196
surplus value 199

T&C (Terms and Conditions) 27, 186
T&M (Time and Materials) 177
Taggart, Adrian 26, 236
tail of the dragon 51
TCP (Total Collaborative Procurement)

217; architecture 219; phases 221
TCPI (Total Collaborative Procurement

Institute) 232
teamwork 67
templates 21; change request 18;

communications plan 24; estimate
107, 127; lifecycle maps 34; quality
plan 145; quality policy 142; resource
forecast 164; risk rank assessment 93;
standard contract 185; TCP phase
design 220; TCP practice design 224;
training 206–8

termination 29, 168
terminology 239
Thorp, John 2, 235
TQM (Total Quality Management)

134

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Page 268

Index 249

trade-off: POC 192; quality 143
trap-line 168
triggers 85
triple constraint 49, 243
trust 198, 230

value pricing 181
variable rate 179
vendor lifecycle 44–54, 243
Verma, Vijay K. 154, 236

vision 170, 213, 214, 237
VSOE (Vendor Specific Objective

Evidence) 184

warranty 52, 111
WBS (Work Breakdown Structure) 109
wedge issues 227
win rate 82
work estimate 47, 112, 244
work packet 109, 191, 244

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