Will Someone Manage My Project Instead of Me?!

The dynamics of global business are changing, growing and transforming very fast, and outsourcing is no different. Today there is no doubt that outsourcing is a highly popular and fast-evolving trend. Many companies are looking for ways to bring more effectiveness to their business via outsourcing, not only in the IT area, but in all major business domains such as finance, manufacturing, and human resources. The projects, thus, are greatly varied and complex – technically, as well as organizationally. As a response to those changes, we experience significant shift in outsourcing business models from pure staff augmentation to the result oriented and outcome based models. In such models project management becomes more complex and more important.

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Organizations are looking for true partners and more expertise from their vendors and more outcomes rather than simple input. We experience increased services transformation to Managed Service model.

Make-or-Buy Analysis

PMBOK® Guide (taken from 12.1.2.1) says: “A make-or-buy analysis is a general management technique used to determine whether particular work can best be accomplished by the project team or should be purchased from outside sources. Sometimes a capability may exist within the project organization, but may be committed to working on other projects, in which case, the project may need to source such effort from outside the organization”. 

Outsourcing brings a lot of challenges to organization, but at the same time it may be a huge advantage if properly established and managed. Not surprisingly, it’s a complicated task – to find a person that has the experience, project management skills and interpersonal skills necessary for a particular project – a project manager.

Should you outsource your project management or should you hire a new project manager?

Ideally, a project manager ensures a project’s successful and timely completion, so in the case of ineffective management leading to a project or business failure, companies, quite naturally, start looking for ways to redeem the situation. A more productive approach, of course, is to find the right person that is able to manage a particular project before any failures take place – only then, should you begin your project. This type of individual cannot always be found within an organization. Lack of in-house expertise, knowledge, funds or availability are all valid reasons to decide to outsource project management. In case the whole project is outsourced, it is quite naturally that project manager is also a member of vendor’s organization and will be responsible for leading the project. 

The vendors providing outsourced project management expertise should be focused on training, development and coaching project management experts. Project managers should be trained not only to follow the standards and best project management practices, but also the very important thing – a collaboration with client, understanding the client’s business, domain, market, project goals, product and end user’s needs.

What is important to remember that project management is not only about completing the project on time, on budget and on scope, it is about building a long-term and result oriented collaboration between the two organizations working towards the same goal.

Advantages of outsourcing project management, which motivate you to think about it. What are some of real benefits?

Experience, knowledge, best practices, availability. The organization may have its own expertise in-house, but there are no available project managers to do the actual job. External specialists can have the time to invest more into project management research, new technologies and methodologies. Consultants use best practices developed during their previous experience and assignments. By using external expertise, organizations will gain the necessary knowledge to be able to drive the project themselves. 

Timely support. Project managers from vendor’s organization usually know how to use better the services provided by their organization. In case of some risks, they may use not just internal to project assets, but also request proper support from the entire organization. 

Objectivity. All organizations have their own politics and negotiations behind final decisions. This takes a lot of time and attention of the internal personnel as most of the employees within the organization have their own interests in many of the decisions. An outside person is less likely to fall under the influence of office politics and may bring an independent and more objective view of what is better for the organization. 

Cost savings is also an important issue on the list of outsourcing advantages. Cost saving was always in a list of most important reasons to outsource, though the situation changes more and more. Currently many organizations are looking for true experienced, reliable partners and cost is not the most important question. 

Be well prepared for the challenges 

Culture and processes. Each organization has its own culture that has been developed, as well as established processes and procedures. The bigger an organization, the harder it becomes for every new employee to adjust to all the processes and rules within the company. For a project manager who is external to the company, the period of adoption may be much shorter as the project manager should concentrate on the ongoing project rather than on learning and understanding the company. The important fact that project manager should be well informed and familiar with both organizations, with practices and processes. Key to success for project manager would be a quick adaptation to the environment, learning and ability to react to the change. 

Gaining knowledge and experience. One of the most popular reasons why project management is outsourced is that organizations may not have people with the appropriate knowledge and experience. On the other hand they may never gain this expertise while outsourcing the project manager role. This is why most organizations outsource project management, while additionally developing the necessary skills inside the organization. In such cases outsourcing may become a valuable educational experience for the organizations’ employees working alongside an external project manager. 

Dependency on vendors. Many organizations see some risks in long-term dependency on one vendor when all the knowledge and experience is collected within another company, including the project management expertise. On the other hand, the long-term relations may become a basis for a solid and mutually beneficial partnership, since there is no need for additional period of adoption and the client organization’s culture, as well as processes are already familiar to the vendor. If building a partnership is not possible, clients can avoid outsourcing the most important and valuable tasks, choosing to outsource smaller portions of the project. 

Access to internal information. Another extremely important part of the relationship is between the client organization and the external project manager. The person taking the leadership position will have access to internal information that may be sensitive or confidential. It may also make the collaboration between the two companies more complicated. A solution is to establish a good and formal process of collaboration right from the beginning and ensure that it is followed. 

Nothing is ever completely outsourced 

To understand this, the project manager consulting for your organization should work on a few important hard and soft skills: 

Contract management. The project manager is the key person who should possess complete knowledge of the contract and manage the relationship according to it. In a current changing environment more and more organizations try to shorten the contract duration as much as possible to be able to switch to another option if the current one is not quite acceptable. Under such conditions project manager should quickly react to the change and be flexible enough. Also need to keep in mind that contract brings additional limitations and constraints like less flexibility in scope or cost management which should be taken into consideration and followed by project manager. 

Managing relationship. In outsourcing, the project manager is managing not only the technical aspects of a project, but also the business components, the business relationship between two companies in particular. It requires key skills that may be weaker in the case of managing a project in-house. It is advisable to focus upon the art of negotiation and the business relationship. 

Cultural background. Outsourcing already implies the collaboration between people from different cultural environment. Every project manager should have strong knowledge of the traditions of the client’s company. This knowledge could be gained while performing company research, communicating with the employees inside the company, by asking questions, socializing and establishing a relationship with co-workers. 

Communications management. It is often said that communication is the glue connecting all the parts of a project together. Being external to your organization, the project manager should never let their communication management skills get rusty, always maintaining them on a very high level. 

Time zones. It is probably worth saying that in majority of cases project manager operates in a different time zone that the client organization. This brings additional set of challenges to the communication process, need to adjust to find period of time overlap, organize good quality communication tools, video sessions, often visits. 

Distributed teams. Often project manager is responsible for the project success, having team members from both sides – internal to his/her organization and from client’s organization. Such distribution is an additional reason to be good in communication, building relationships and team building skill. Project infrastructure should be in place to support multiple locations. The challenge of distributed teams is also in a processes alignment between two organizations. Project manager in outsourcing should learn new processes typical for client organization and teach them the entire team.

Strong people skills. Ability to build effective project team and ensure a successful project completion while at distance also requires a strong ability to find a personal approach to each team member. 

Being adaptive. In most cases an external expert should be able to adapt to the internal rules, processes and traditions of the organization in a very short period of time. While the ability to adapt is important, it can also be an acquired skill, which is especially important if you have to adjust to the working conditions existent in the client organization that may not be comfortable. Your main focus should be on achieving a positive project outcome. 

Flexibility, mobility. It is very likely that traveling and an intensive schedule will be unavoidable during the project period. The project manager should be able to react to the changes and adapt to any circumstances. 

Language. It is obvious that the knowledge of foreign languages would be absolutely necessary to be successful as project manager in outsourcing. 

What options are better? These, what are available

When considering your options, make sure if this is a good move for your company. Outsourcing project management may be a great experience with an added value. An external support saves the money, your time and stress and in fact, it can be your business model. Many vendors offer outsourced project management expertise, but one thing should be clear: finding the right one can be challenging. Just be aware of risks involved in this. You have specific projects and you need the expertise and resources and understands your needs and expectations, to lead to the success of your projects.