Why project managers need to be contract managers too

The numerous framework agreements have provided the public sector with a more streamlined and objective way to procure IT services. So far so good. The challenge comes when project managers – whose skillsets and training lie in project management and not procurement – are expected to manage the “as-a-Service” framework-based projects in the same waterfall approach they have used effectively throughout their career. Managing a more agile, post-waterfall project requires a very different set of skills, which unfortunately are not prioritized in the public sector, leaving many project managers out of their depth, projects going over budget, deadlines being missed, and projects potentially veering generously off-piste from their original objectives. Here is how project management has changed, and how skillsets must adapt in response.

The “old way” vs the new

Prior to the introduction of the framework agreements, the public sector relied on the expertise of procurement specialists to protect its interests when buying products or services. Since most procurements are multi-year in their horizon, this put a lot of management effort up front to ensure that the requirements were clearly written. Once the terms were agreed by procurement, a project manager would take over to ensure the delivery of those terms over the course of the contract, while the procurement manager would move on to another project.

The public sector has now largely shifted away from this up-front capex approach to a more operational, opex model (e.g. traditional IT has moved to cloud services which are often, but not exclusively, procured through frameworks). Since the frameworks have done most of the up-front contractual work already, less procurement expertise is required at the start of a project. Instead, the focus has shifted to the continuous management of the contract to ensure the best continual result.

This ain’t no waterfall

The key issue is that the skillsets required for the “in life” management of a multi-year contract vs procuring it in the first place are not the same as each other, yet the staffing of these projects has not changed to reflect this. Too often, those same project managers whose skills, training and careers have evolved around traditional waterfall project delivery (backed up by the expertise of the procurement manager who ensured all the I’s were dotted and the T’s were crossed from the outset), must now combine their existing project management role with ongoing contract management too.

So, what can project managers learn from contract managers to keep their projects ticking along?

  • Work more strategically with suppliers – The shift away from a capex funding model which is laser focused on delivering one, very specific outcome is a world away from delivering a framework, which typically involves the delivery of continually evolving business outcomes. This more agile, opex approach requires a very different relationship with your suppliers which is far more strategic and based on mutual trust and regular communication. Simply put; the relationship can no longer be transactional, it must be strategic.
  • Get out of your silo and manage your stakeholders – It is not uncommon to have 100+ stakeholders involved in a project who need continual, not occasional, engagement. As the de facto contract manager you must now go out and build the necessary relationships with suppliers and internal stakeholders. Working this way will also help to move your organizations away from waterfall project delivery and towards a more effective service management approach. It is therefore a task worth embracing.
  • Work closely with your commercial stakeholders – The frameworks have significantly reduced the big contractual discussions since most of the terms are pre-validated and agreed upon. So instead of managing very large changes every five years or so when the contract is renewed, you must now manage much smaller tweaks on a more regular basis. This requires you to work with your commercial stakeholders throughout the delivery of the project, so make sure they know who they are!
  • Agility is key – Rigid procurement rules in the public sector often prevent projects from being as agile as they should be. For example, if an already-contracted software vendor launches new features which could greatly benefit the public sector client, often the client cannot simply raise a PO for these new features due to the way procurement is still largely about fixed outcomes. Instead, they must engage in a full tender process just to add these features to their service. This is a waste of the client’s and supplier’s time. We should all be challenging this rigid approach whenever it comes up.
  • Hire dedicated contract managers! As the above points have hopefully demonstrated, contract management alone is a full-time job. It is therefore unfair to expect project managers to take this on by themselves. This is because project managers are focused on delivery, while contract managers are focused on outcomes. A contract manager will understand the scope and legalities of the framework, leaving the project manager free to focus on technicalities of delivery. Since the focus of each roles are a little different but complementary, it is important that they work in tandem to achieve a successful outcome. Project managers need the full-time support of a contract manager, although it is worth recognizing that a good contract manager may be able to resource several projects or programs simultaneously.

IT service management (ITSM) as the end-goal

Beyond the employment of dedicated contract managers, there needs to be a recognition that successfully delivering agile projects requires a wholesale change to the project management approach. This is about more than simply distinguishing between the project and contract management roles, but about working with your suppliers to adopt a broader, IT Service Management (ITSM) approach to deliver the outcomes your organization needs. 

Yes, you need to have the right roles in place with the appropriate skillsets, but you also need the right governance in place and suppliers that are willing to deliver within that governance model. You need to define an operational model that delivers service management at its core. Perhaps it’s time to brush up on your ITIL credentials?

Romy Hughes, director, Brightman

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