Updated: Jul 23, 2019
JONATHAN CORRIE ON
With levels of competition increasing across different sectors, we observe a range of revenue challenges faced by suppliers in media, tech and telecommunications. For a well known telecommunications company, the inability to supply project managers on time led to penalty fees as well as higher internal costs. Amongst the big 4 creative agencies, contracts have been lost due to inconsistent delivery and campaigns not meeting expectations as a result. For a $100M telephony provider, they were unable to start projects until 3 months after closing deals - this resulted in not realising $20M in revenue due to accounting rules.
When a telecommunications company (with a PMO of 50+ project managers responsible for delivering 3,000 projects a year) fails to hit their SLA as project managers weren't assigned in time, this cost their business £800,000 per year. Beyond the cost, which had to be covered by the supplier as they only charged for 5% of their project management work with customers, the head of operations was aware of the damage to reputation this would cause.
The causes of this problem included:
Disconnected systems. The sales team used a CRM (Salesforce) which the PMO didn’t have access to - projects were managed in a different, in-house system, with insufficient forecasting functionality.
Capacity planning was managed in spreadsheets which couldn't cope with the volume of activity and the changes to project requirements.
Lack of governance around the planning and execution of projects. This included an inconsistent approach to both resource management and project management.
Agree when to pre-allocate project management to projects - this should be done in the pre-sale stage rather than after the deal closes. Best in class companies have less than a week between closing a deal and starting the project. A one week delay for a team of 3 costs the average company $25,000.
Find the right cadence to allocate resources to projects. Depending on the volume of activity this will either be daily, weekly or bi-monthly. It is vital that both pipeline, sold work and sell on work in a part of the same discussion - many fail when their pipeline discussion is separate.
Project Management is made harder when resource managers don't map skills and knowledge to project effectively. The best companies have a 1:40 ratio of resource management to project managers.
Investing in an integrated CRM and project delivery solution will help to ensure a seamless transition between selling and delivering projects.
Precursive knows how workforce management isn't just about matching time to task, post-deal. Revenue can increase incrementally through either extra work capacity, generated by earlier deployment, or as revenue can be recognised earlier. Time is precious so it should be used well, doing the work not doing the admin.
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