Managing outsourced projects: The Good, the Bad and the Savvy by Marco Negri

Managing outsourced projects: The Good, the Bad and the Savvy by Marco Negri

Speaker: Marco Negri

Project Manager, PMP, ITILv3
Anas S.p.A. - Rome

Tuesday, 8 May - 9.00–10.15 - 1 hour, 15 minutes

Summary: How may times have you seen in a contractor’s GANTT a bar called generically “project management” and then wondered what deliverables should it actually produce? This session describes some typical issues of outsourced projects, describing client expectations (the good), what actually happens (the bad) and a suggested approach (the savvy). Learning objectives
maurel-celine Report by: 
Céline Maurel, PMP
France Sud Chapter

 
Managing outsourced projects: The Good, the Bad and the Savvy by Marco Negri

Report:

The goal of the session is to help managing outsourced projects from the customer’s point of view.

An outsourced project is a “goal oriented undertaking of multiple tasks” within a given period of time composed of:

  • The client (or customer or buyer) that pays to get a product.
  • The contractor (or seller) that gets paid to build the product for the client.
  • The contract that is a mutually bind agreement between the client and the contractor to define the project scope, duration and cost as well as the level of quality required.

Projects are outsourced because either the client has not the resources to build the product or buying the solution is less costly and more effective.

Even if the client and the contractor have a common interest on getting a successful product, they can also have many conflicting interests such as:

  • The contractor may focus on business objectives instead on the product itself and then, the outcome will not satisfy the client.
  • The client wants the best quality whereas the contractor wants the less possible costs especially in fixed price contracts.
  • The client wants the best resources for its product while the contractor manages to balance its available resources among all its projects.

The author provides a tip for each Knowledge Area of the PMBOK® involving 3 famous figures of the Starwars film: The Good is SkyWalker telling what should happen in an ideal world, The Bad is Dark Vador saying what’s happening in reality and The Savvy is Mr. Yoda providing wise advices listed in the following table:

SCOPE
  • Request a deliverable-oriented WBS content to get rid of “empty boxes”
  • Decompose each Work Package in the deliverables you expect
QUALITY

Define what is the expected quality of each deliverable

  • Before awarding the contract
  • Using one or more metrics (e.g. response time, number of bugs, number of testing iterations, …)
TIME
  • Plan time for the rework cycle of each deliverable
  • Use these tasks for each deliverable: Production, Client review, Correction, Client approval
COST
  • Assign to each deliverable a cost to the estimated man-hours
  • Use an objective completeness criterion to measure the completeness of each deliverable. For example:20% at start, 60% at the end of client review and 100% at client approval
PROCUREMENT

Incorporate in a fixed price contract a balanced set of bonuses and penalties (“carrots and sticks”)

COMMUNICATION

Strive for upper management sponsorship or no one will follow you

HUMAN RESOURCES

Try to put the contractor in your shoes:

  • Explain clearly your business objective in the contract
  • Link penalties and bonuses to the achievement of your business objective
RISK

Risk response plans should be incorporated in the project plan

INTEGRATION
  • Risk response plans should be incorporated in the project plan
  • Create a checklist for each deliverable
  • Incorporate lessons learned in the relative “deliverable checklists”


Conclusion:

This session described technical tips to avoid 9 typical issues occurring in outsourced projects in order to develop a win-win strategy. It was a very interesting session that provided useful information in a funny way.

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