/* Template Name: Autoresponder */ Myth #6: Outside Suppliers Can Be Trusted To Add The ‘Right’ Value – Part #3 (Lesson 21) - Global Village Transformations

Myth #6: Outside Suppliers Can Be Trusted To Add The ‘Right’ Value – Part #3 (Lesson 21)


Can you tell the difference between ‘experience’ and ‘experience’?

On one particular project that I was brought in to rescue, the very experienced team of consultants were obviously not experienced enough. The substantial proficiency that they had gained was from working on ‘small to medium’ projects, at least when compared to this particular ‘large’ project.

The project team was mainly comprised of a clique that had originally worked at a much smaller company that had been acquired. Despite being part of a larger, global organisation, 10-15 years later, they retained their old ways of working and small-town outlook.

Observation #1 – smaller projects are easier to grasp hold of and control

People with a good technical and functional understanding of the problem domain can often do well driving through the successful delivery of smaller projects.

Actually, quite often, things do not go according to plan on projects of this size either. Corrective action at this scale is less catastrophic for all parties, though; especially when compared to the huge, multimillion-dollar endeavours that fail.

The project manager for this particular failing project was the same senior consultant responsible for the poor estimation of the project in the first place – underestimating by a factor of 4-5 times the eventual effort/cost. For me, though, he was not a ‘real’ project manager. Worse, he was out of his depth and did not know it – and scarily, neither did his peers.

When projects become larger than people have experienced before, they really do not know what they do not know. When you couple this with my next observation, you have the basis for failure baked into the plan right from the beginning.

Observation #2 – people are afraid of big numbers

This one is a regular killer, and a major cause of project failure.

Once again, there are two sides to this sorry tale: the supplier’s side and the customer’s. Both can contribute to the problem, although the supplier’s side can be far more insidious.

If we look at the customer perspective first, we see a huge desire to keep costs as low as possible.

This begins at the budget allocation stage, continues through the procurement process (which is often ferociously mandated to ‘get the price down’), and then continues throughout the project life cycle. Change requests that increase costs are often treated with suspicion at best, and disputed/refused at worst.

Nobody wants to go back and ask for more budget.

Looking at the supplier perspective, on the other hand, we often see a huge desire to keep the costs in a proposal as low as possible.

In a competitive bid situation, cost is usually a major deciding factor, regardless of the nominal weightings that the customer attached to that factor in the selection process. Human beings will always be prone to sticker shock, and suppliers rarely want to be outliers when it comes to pricing.

Who would want to put forward crazy-large estimates to a client when:

  • ‘They would never buy it at that price!’
  • ‘I need this sale to hit my quarterly sales target.’
  • ‘If we lose this deal, it will affect everyone’s billable-utilisation bonus!’

Both customers and suppliers often have the attitude that the consulting teams are well paid, so they are expected to work professional consulting days (i.e. as many hours as it takes) to resolve the issues.

Once again, ‘Suck it up, princess!’ is not a very good strategy for ensuring that a supplier meets the desired time frame, regardless of where the fault lies.