The Money Files

Stakeholder engagement doesn’t just happen. You need to work at it, and marketing your project is one way to do that.

What?

OK, let’s start with a definition of marketing as it relates to projects.

Marketing is a planned series of tasks with the objective of promoting your project to a wide audience.

It goes beyond project communications planning because it’s not just about sharing status updates or communicating because you have to. Marketing is the promotional activity to get people to believe in what you are doing and to want in. It’s making sure that your communications plan has an impact beyond the paper it is written on and beyond what’s simply communication on a functional level.

Taking a marketing-led approach to projects does impact project success. In research done by Peter Taylor in 2014, 87% of respondents said that marketing activities have an impact on project success, with nearly half saying it’s a critical activity.

You’ll see that there’s one typical response missing from the graph – the ‘no impact’ response. That’s because no one replied saying that marketing was unimportant. I thought that was interesting – generally people believe marketing is a good idea.

Tools for Marketing in a Project Environment

So if that’s what’s marketing is all about, what tools have we got available to us to do it?

The tools I use most often to communicate with my team and stakeholders are:

• Web conferencing
• Instant messaging
• The good old project status report

This is the one I use to communicate project status to my sponsor. It’s a weekly report. I still send it in a Word document format and it’s one big table, even though I know that tables don’t display well on BlackBerries and the people who are reading it are likely to be travelling and using their BlackBerries a fair amount of the time.

Despite technology moving on, in many respects the way we communicate with our project sponsors follows the tried and tested route.

These tools are good, and form the backbone of any project communication strategy. But there are dozens of ways you can communicate and you don’t have to only rely on them.

Here are some other tools that you can use, many of them are free or at least low cost, so they won’t have too much of an impact on your project budget.

Even if your communication plan and stakeholder analysis tell you that a particular stakeholder likes to receive information by email you should vary your tools from time to time. It helps keep the message fresh. It helps reach a greater audience – and marketing is about reaching a wide audience to spread information about your project.

You can also look for less obvious sources of good PR such as providing information or resources to other teams at short notice – activities that don’t have a blanket reach and might not feel like traditional communication activities but they will create positive engagement on a much smaller scale. That engagement is likely to be deeper than in the case of receiving a mug with the project’s slogan on, so that’s the benefit.

However, you should also bear in mind that communication is a two-way street. Just because you tell someone to do something or ask for their involvement doesn’t mean it will happen. Project communications and marketing can’t just be about pushing messages out there – your tools should include ways to receive messages too.

Some of these tools, especially the ones where you are meeting face-to-face, give you the opportunity to get those messages back. In my experience you’ll still have to ask for them, so ask for feedback and then act on it.

For more information on project marketing and the tools you can use to communicate about your project, watch my PMXPO talk on the topic. You can get it here (and claim a PDU at the same time).

This is an extract from the draft of the second edition of Social Media for Project Managers by Elizabeth Harrin and published by PMI. Consider it a sneak preview for when the book comes out!

The normal approach is to define your strategy, research what you need to do in order to achieve that (both in terms of cultural and non-technical changes and software/infrastructure investment) and then prepare a business case to secure the investment. When the business case has been approved you then go into more detail and fully scope the projects or programs required to deliver on that investment.

However, a full financial business case doesn’t always stack up for collaboration tools for many reasons including:

• The difficulties of measuring intangible results like ‘better collaboration’
• The time it takes to baseline today’s results to compare future performance
• It’s hard to define exactly what return on investment would look like
• The lack of detailed time recording to see whether improvements have been made in productivity and speed of access to experts.

In short, the intangibility and unpredictability of knowledge work makes it hard to quantify anything reliably. Project work by its nature is non-repetitive, and if you have deployed your collaboration tool at the beginning of a project you may not have sufficient experience with that team and on that project to estimate, for example, the length of time tasks are taking with any degree of accuracy. Without that baseline you cannot definitely say that your software has improved the delivery time for tasks. For that reason, many organisations choose not to measure efficiency in a quantitative manner. Instead, companies often rely on employee surveys that in turn rely on subjective responses around whether a tool has made it easier to work together. Make an educated guess based on anecdotal evidence and feedback from the project team.

To give another example, it is difficult to quantitatively measure the positive impact on enabling online communications. How much more useful are project workspaces than a phone call? Bloggers in the public online space often use the amount of comments and social shares received on a blog post as a measure of popularity, interest, engagement with their readers and so on. This is not a reliable measure in a workplace setting: a discussion post may have a couple of comments before you step in and facilitate a face-to-face meeting on the topic, or the commentators pick up the phone to each other to get to the bottom of the finer points. The amount of conversation going on is not necessarily a reflection on the quality of those conversations, so again this is a difficult thing to measure.

The inability to clearly define and measure what you want to achieve will make many project managers uncomfortable (and may force them to choose irrelevant or subjective measures for success). After all, the project charter should include enough detail about scope and acceptance criteria to ensure that the relevant people can sign off the project’s products as complete and fit for purpose. You wouldn’t embark on a project without knowing what ‘finished’ looks like, and knowing who would agree that the work has been completed to the required quality.

However, do you measure how well you wrote the Project Charter or how effective your quality reviews were? Probably not, outside a general feeling that it was a good, comprehensive document or that the meeting participants got what they needed from the review. Collaboration tools are a project support system much like email or conference calls – and would you measure the success of those on a monthly basis? Success criteria are useful, but they do not have to be statistically measurable. Consider the implementation of digital team tools as another option for your project management toolkit. You can measure it with the same judgment calls that you do for the other processes in your methodology.

Don’t struggle with a full financial business case unless you really need one to get your investment approved.

The alternative to a financial business case

If a full financial business case won’t stack up, or your leadership doesn’t require one, then prepare a short options appraisal instead. Review the solutions available to you, using any identified in your strategy document and any others that have come about as part of your general research into delivering the strategy. An options appraisal includes:

• Pros and cons for each option
• Financial investment for each option
• Timescales for implementing each option
• Resource implications for each option
• A recommendation, stating which option you want to go for.

Present this to your decision makers and start the discussion to secure the investment in your collaboration tool.

Alternatively, consider asking for approval at this point only for the analysis phase or a small pilot. This would give you a mandate to go ahead and research the market and how the tools might benefit your teams, while not asking for a financial commitment at this point.

The second edition of Social Media for Project Managers by Elizabeth Harrin will be out next year.

I’m not the world’s greatest when it comes to numbers so when I started getting more involved with project financials I decided it would be a good idea to read up on the subject. I bought Project Management Accounting a few years ago now and it has become my go to book for understanding project budgets. It’s by Kevin R. Callahan, Gary S. Stetz and Lynne M. Brooks. My copy actually still looks pretty new, as I don’t get it out to read very often – it’s the kind of book that is useful at certain points in a project and then goes back on the shelf.

Here are my takeaways from it.

Financial understanding brings seniority and gravity

“Senior project managers have their roots in many different areas of expertise, but the great majority do not come of out finance or accounting,” write the authors. That’s true, and it means that for many of us there is a huge hole in our knowledge of how the mechanics work around paying for projects and accounting for the returns.

The authors think that once you’ve gained experience and proficiency in project management skills, you’ll benefit from learning more about the numbers. They write:

“After years of managing larger and more complex projects, senior project managers often aspire to making greater contributions to their organisations. One way to do this is by gaining expertise in fiancé and accounting, thereby enabling them to view the organisation from a different perspective and to make a greater contribution to it.”

I agree: I think it’s hard to really make a strategic difference, even on smaller projects, unless you understand the fundamentals of how cash moves around the business and how your company makes money. It’s one of the reasons that I’ve tailored this blog to be mainly about the financial topics relating to project management. If we want to – as an industry, as a profession – move the perception of project management to the next level then we have to be taken seriously and be seen to operate a senior levels. Seniority in many companies often goes hand in hand with the ability to handle budgets.

Get involved in the financial decisions

I particularly like the fact that it advocates for project managers to get involved in financial decisions. The authors write:

“[Early during the project’s conception], often project managers are not part of the decision-making process. In many cases, it is because the project manager is not believed to have the business experience necessary to make such decisions. However, using the project management and business tools [discussed in the book] a project manager can guide the decision process to avoid making costly mistakes. It will not always be easy for project managers to have input into important financial decisions, but without some knowledge of how finance and strategy work, they will have no input at all.”

I think this is a really important point, because the shift in project management is towards project managers taking on a greater responsibility for leadership in the early stages. It’s no longer just a delivery job (thankfully) and includes elements of business change and strategy. So you need to have the vocabulary and skills to take part in discussions at that level.

Boost your network

One of the things discussed in Chapter 6 is the role of the financial manager. Do you know who the financial manager is for your project? It’s not an accountant. The authors point out that the role of finance is to “develop benchmarks as a guide to managers”.

A financial manager is someone who can create a good balance sheet, the optimal one for the company at this point in time. That can involve advising on which projects to take on, which to stop and providing input into business cases. They also work on financial documentation such as budgets, and income and balance sheet statements.

Your project, especially if it is sizeable, will need someone in this financial management role as well as potentially another person to handle the invoices and make payments from the bank. Those latter functions are normally handled by the Accounts Payable team and you’ll have standard corporate processes for doing those. Advising you on your project takes a trusted financial ‘adviser’ in an internal role, so build your network and consult the company org charts so you know who to turn to.

In summary

I’ve only pulled out a few key points from this book and added my thoughts but I hope you can see that it’s a useful shelf reference for project managers looking to move into more senior positions or those generally wanting to understand more about how money moves around in the company. I’d recommend it.

Book referred to in this article: Project Management Accounting, Kevin R. Callahan,  Gary S. Stetz and Lynne M. Brooks. Wiley, 2007. The image is of the 2nd edition. I am quoting from my copy, which is the first edition.

In this video I talk about the cost management processes.