Ask the Experts: Getting funding for your projects with Rob Prinzo

From the The Money Files Blog
by
A blog that looks at all aspects of project and program finances from budgets and accounting to getting a pay rise and managing contracts.

About this Blog

RSS

Recent Posts

7 Reasons to crash your schedule

10 Expert Tips for Project Budgets

5 Steps for Make or Buy Analysis (video)

8 Tips for better benefits management

5 Ways to make better decisions

Email Notifications off: Turn on

Categories: business case, interviews

September marks the beginning of budget season: when we are all trying to work out how much our projects will cost in 2012 and put in requests to the PMO and senior executives for what budget allocations should be made.

In this installment of my Ask the Experts feature, I spoke to Rob Prinzo, founder and CEO of The Prinzo Group, an innovative  knowledge firm that provides performance management expertise through project assurance solutions for enterprise  transformation  and technology projects. He is based in Georgia, and is the author of No Wishing Required: The Business Case for Project Assurance. We spoke about financial loss, why business cases are rejected and managing procurements.

Rob, lots of people are preparing business cases now for projects that will begin next year. Is this early stage the time when most projects are at risk of financial loss?

I have found that the following points in the project lifecycle are where the risk of financial loss is greatest. To prevent against financial loss and another failures, I recommend conducting a project health assessment at each of these crucial points.

  1. During the strategy phase, before the business case is presented for approval and funding.
  2. During the acquisition phase, towards the end of the vendor selection process, before vendors are finalized and negotiations begin.
  3. During the planning phase after the initial drafts of the Project Charter, Detailed Project Plan and Change Management Plans have been developed.
  4. During the design phase after the initial drafts of the System Design Documentation have been developed.
  5. Towards the end of the development phase or the beginning of the Testing Phase.
  6. Towards the end of the testing and training phase before the system cut-over.

You talked about vendor selection there. Procurement management is something project managers sometimes struggle with. What are your three top tips for making the procurement process as smooth as possible?

Make sure that you have defined all your requirements and dependencies. A lot of organizations get into the procurement process or make a purchase and soon realize that they have left something out. Make sure everybody is involved in requirements definition and validate the scope against lessons learned from past projects.

Develop a Request for Proposal. As simple as it sounds a lot of organizations skip this step. A RFP will provide structure to the process and help you compare apples to apples.

When possible engage vendors in a prototype exercise or conference room pilot. This will allow you to dive deeper into specific requirements for your organization and get a feel for what it is like to work with each vendor before making a commitment.

Working with the vendors in this type of prototype exercise will also give you a feel for how robust their estimates are, both financially and in terms of timescales. This is useful to know to feed into the project budget. What's your advice for making sure that project budgets are as robust as possible?

Robust budgeting starts with comprehensive requirements. I recommend starting by making a list of all your projects, categorizing the projects based on: size, business function, type, level of funding, effort and organizational impact. Next, determine the dependencies with other projects, funding, resources and business decisions.  Once you have your list, categories and dependencies you can start to determine the projected costs for the projects.

Great, thanks. So if you’ve done all of that and worked out the projected costs accurately, why do some business cases still get turned down?

I have seen Business Cases get turned down for the following reasons:

  • Lack of funding – This happens often, especially in this economic environment.  As a project manager, if you feel that you have a large imminent project, but do not feel that the organization can fund it this year, consider breaking up the initiative into smaller projects or breakout the upfront requirements definition into separate project. This will help keep the project moving forward, reduce the overall project timeframe for the bulk of the work and spread the cost over a longer time period.
  • Communicating Business Benefits. A lot of teams do not focus on the business benefits of doing a project or the consequence of not doing a project. Instead the team focuses on technical outcomes: we need to upgrade or move to a new technology platform without properly stating the business reasons and befits why this is necessary (streamlined process, integration, operating efficiency, etc.). Project Managers need to make sure that the business need, not the technology need, is clear.
  • Timing – It may not be the right time for the organization to undertake a particular initiative. If the timing is not right, use the opportunity to educate decision makers on the project, get feedback and refine the business case for a more appropriate business cycle.

So if our projects don’t get funding for 2012 it’s not personal! Thanks, Rob.

You can follow Rob on Twitter: @RobPrinzo

Posted on: September 06, 2011 05:53 PM | Permalink

Comments

Please Login/Register to leave a comment.

ADVERTISEMENTS

What's so great about a mom and pop store? Let me tell you something, if my mom and pop ran a store I wouldn't shop there.

- George Costanza

ADVERTISEMENT

Sponsors

>