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Bringing Strangers into the Project

 

Project Business Management

SERIES ARTICLE

By Oliver F. Lehmann

Munich, Germany

 


 

“An organization’s ability to learn, and translate that learning
into action rapidly, is the ultimate competitive advantage.”
Jack Welch

Summary

Project management is changing from an internal cross-functional discipline into a cross-organizational business discipline. Project managers today must ever more tap the assets of other business entities, such as vendor companies and freelancers and turn them into project resources to develop the project performance and agility that internal resources alone can no longer deliver.

The lack of education and literature on the topic makes this transformation very difficult for the people involved and bears the risk of costly errors.

 

Delphine’s Story

In my last article[1] in the Project Business Management series in PM World Journal, I told the story of Jack Miller, who had changed job. So far, he had been doing internal projects, but his new employer was a company that generates its income through customer projects, and Jack was surprised at the vastly different requirements that he needed to meet, and for which he was not prepared at all.

Jack had a colleague and friend over many years, Delphine Smith[2], who stayed in the company, when he had to leave.

In the following months, Delphine also saw major changes happening to her work; changing from doing cross-functional projects with internal projects to cross-corporate projects with external resources. In essence, she experienced the same story but from a different standpoint and if only she had been prepared for the changes to come, she would have been able to cope with them, but she was not.

The Trend Towards Buy over Make

In previous articles in the Project Business Management series, I showed that there is an observable trend from internal projects to projects under contract. In a growing number of projects,  two or more organizations work together to achieve the project results, commonly in customer-contractor business relationships, in which the contractor does work for the customer and gets paid in return.

This development splits the project management discipline into two groups:

  • Project manager on customer side, using external resources and paying for them.
  • Project managers on contractor side, whose job it is to bring money home with projects.

Figure 1: The trend from internal, cross-functional project management to cross-organizational project business management doubles (or multiplies) project manager functions.

Figure 1 depicts this split inside the profession as a consequence of the trend towards customer projects.

The two types of project managers have to meet different requirements:

  • The first type of project managers takes over internal projects and procures the services from vendors. They must ensure that the support from the vendors is what is expected and that inside a project supply network (PSN), all parties follow a principle of “Completing over competing”, acting as partners, not as parties.
  • The second type of project managers takes over customer projects. Project Business Management for them means predominantly “bringing money home with projects” and making the customer happy.

This article will focus on the first group, the experiences of the second were the topic of the previous article in this series[3].

There are also project managers who act as “in-betweeners” in organizations such as prime contractors. Their organizations are both at the same time, contractors to customers and clients of sub-contractors.

Sitting between the tiers can be a lucrative position, but it can also be a commercial disaster. Wherever one is sitting in project business, one should remain acutely aware that project business is high risk business for all parties involved.

More…

To read entire article, click here

 

Editor’s note: This series of articles is by Oliver Lehmann, author of the book “Project Business Management” (ISBN 9781138197503), published by Auerbach / Taylor & Francis in 2018. See author profile below.

How to cite this article: Lehmann, O. (2018). Bringing Strangers into the Project; Series on Project Business Management; PM World Journal, Vol. VII, Issue XI – November.  Available online at https://pmworldjournal.net/wp-content/uploads/2018/11/pmwj76-Nov2018-Lehmann-Doing-Projects-with-Contractors2.pdf

 


 
About the Author   


Oliver F. Lehmann

Munich, Germany

 

 

 

Oliver F. Lehmann, MSc., PMP, is a project management author, consultant, speaker and teacher. He studied Linguistics, Literature and History at the University of Stuttgart and Project Management at the University of Liverpool, UK, where he holds a Master of Science Degree. Oliver has trained thousands of project managers in Europe, USA and Asia in methodological project management with a focus on certification preparation. In addition, he is a visiting lecturer at the Technical University of Munich.

He has been a member and volunteer at PMI, the Project Management Institute, since 1998, and served five years as the President of the PMI Southern Germany Chapter until April 2018. Between 2004 and 2006, he contributed to PMI’s PM Network magazine, for which he provided a monthly editorial on page 1 called “Launch”, analyzing troubled projects around the world.

Oliver believes in three driving forces for personal improvement in project management: formal learning, experience and observations. He resides in Munich, Bavaria, Germany and can be contacted at [email protected].

Oliver Lehmann is the author of “Situational Project Management: The Dynamics of Success and Failure” (ISBN 9781498722612), published by Auerbach / Taylor & Francis in 2016 and ofProject Business Management” (ISBN 9781138197503), published by Auerbach / Taylor & Francis in 2018.

To view other works by Oliver Lehmann, visit his author showcase in the PM World Library at https://pmworldlibrary.net/authors/oliver-f-lehmann/

 

[1] (Lehmann, 2018b)

[2] Name changed

[3] (Lehmann, 2018b)