Enterprise IT Consulting clients often ask “do we really need to pay for a separate vendor project manager when we have our own in-house PM?”
It’s a great question and one I’ve often addressed from both sides of the table. The short answer is that there is no one-size-fits-all-answer. Suppose for a moment that a client organization is highly “projectized” or “matrixed.” It may already have a strong centralized PMO (Project Management Office); perhaps it also has PMO’s organized along line of business (LOB) or departmental lines. Or maybe the exact opposite: little or no centralization, distributed project management and lots of ad hoc resources. In either case, the “right” decision must be weighted against several criteria:
- What special expertise will the vendor’s PM bring to the table? Is the expertise unavailable internally?
- Will the vendor’s PM get the project deliver much faster?
- Will the vendor’s PM add substantial cost and overhead?
- Will the vendor’s PM effectively bridge the gap between client and vendor staff members?
- Will the vendor’s PM be exclusively available to the project? Or will he/she be distracted and billed to multiple clients simultaneously?
- Will the vendor’s PM be compatible with existing client processes and policies?
A Dedicated Vendor Project Manager May Be Useful When:
- Internal project managers are over-allocated to current projects.
- Your organization has no existing enterprise-scale Strategic IT expertise.
- The vendor is adding 3 or more engineers/architects/developers to the project.
- Vendor engineers will not be tightly embedded with internal staff and may be working remotely.
- Vendor or project has complex time, budgeting and reporting requirements requiring dedicated attention.
- Terms of your vendor master consulting agreement, scope of work document (SOW), or service level agreement (SLA) require it.
- When multiple vendors are engaged in complex project, with each owning only a portion of the overall program.
- When technically complex deliverables are required with very tight timelines.
- When multiple deliverables are required by complex teams of different vendors and internal staff members.
- To help vet Internal project or program plans.
- When maintaining program continuity during internal resource shuffles or key resource losses.
- When there are significant differences between vendor and vendor methodologies.
A Dedicated Vendor PM May Not Be Useful When:
- The project is an ongoing support or maintenance project. (Not requiring new implementation or integration.)
- For portions of your program or project that are strictly internal, such as general project scheduling, determining compliance or regional requirements.
- When only one or two vendor engineers are deployed on your site.
- When internal project plans are tightly scoped, vetted, and agreed with vendor technical staff.
- When vendor PM overhead is cost prohibitive.
- When significant internal PM expertise exists and is available for your current Strategic IT project.
Decided to Try the Vendor’s Project Manager? Then…
- Insist on an iron-clad Scope of Work (SOW) document.
- Establish clear PM beginning, ending, and review dates prior to implementation.
- Require firm division of responsibilities between vendor and client project managers.
NOTE: Many vendor Project Management or “PM” functions may already be performed by the vendor’s engagement manager. Also, be aware that many consulting firms will require use of their own PM to ensure delivery.
Large-scale Strategic IT Programs such as Identity Access Management (IAM), Enterprise Resource Planning (ERP), Enterprise Messaging, Data Center Consolidation and the like require large teams and expert project management. When working with a mixed team of internal experts and outside vendors, be sure to evaluate your needs carefully. When in doubt, consider using the vendor’s project manager on a trial basis to keep your project or program running smoothly.