56 PM NETWORK | JANUARY 2006 | WWW.PMI.

ORG
of
scale
economies
Small companies may not be
able to afford full project
management departments or
dedicated staff, but they can
still employ many
of the underlying
principles.
by Jeffrey Bouley
T
he measure of project management success is not
always an enterprise project management office or an
incredibly detailed set of metrics. In fact, for small-
and medium-sized companies, particularly those with fewer
than 500 people, it might not even be feasible to have a full-
time, dedicated project management staff. But that doesnt
mean that project management shouldnt be an organiza-
tional value.
Although project management once was almost exclu-
sively the concern of large multinationals and defense con-
tractors, todays small- to medium-sized businesses (SMBs)
are emphasizing more discipline and utilizing project man-
agement principles more intently, according to a survey
conducted by EdWel Programs, Chicago, Ill., USA.
scale
s
The survey of 382
SMBs found that 36 per-
cent adhere to docu-
mented procedures for
managing projects, while
27 percent require project
teams to follow more
informal project manage-
ment practices.
Savvier organizations
use project management to
improve company decision-
making, says Michael Welles,
an EdWel spokesperson. Knowing which product to
develop or system to install requires more than just a hunch
in todays competitive landscape. Ultimately, [project man-
agement] comes down to making the right business deci-
sion at the right time.
Perhaps no business understands this more than the small-
est ones with the fewest resourcesthey have the most to lose
from a single misstep. The following three casestwo soft-
ware firms and a biotechnology companyshow that project
management can bring success, even on the smallest scales.
Embrace Outsourcing
Companies outsource all sorts of functions, from building
maintenance concerns to management
and consulting support. When a company
lacks the time, budget or resources to
employ a dedicated project management
practitioner for the long haul, outsourcing
may be the smartest decision, says Jason
Korkin, chief executive officer of Safe
Data Technologies, Concord, N.H., USA.
With just two in-house employees and
four contracted software developers, Mr.
Korkin realized his own companys limita-
tions and looked outside for project man-
agement support. Safe Data Technologies
recently released several Web-based appli-
cations for attaching massive files, sending
highly secure encrypted e-mails, remote
data backup and global e-mail access. The
company also is gearing up to release a
spam- and virus-scanning and filtering solution as well as a
monitoring solution for servers and networks. I looked at
the cost of developing products completely in-house and
having it done by outside individuals while I managed the
company, he says. I even went so far as to look at the
project management aspect and ask myself if I really
wanted to manage projects directly or focus my attention
on other critical issues, such as customers.
Mr. Korkin considered project management firms and
individuals who simply had project management experi-
ence. He finally settled on contracting with a single person
rather than a firmsomeone with whom he felt he con-
nected and comfortable.
I didnt want to spend all my time micromanaging all
the projects were working on, Mr. Korkin says. With five
or six projects going on concurrently, it made sense for me
to outsource the function and have someone else manage
the day-to-day. That project manager makes sure things are
on time, are done professionally and meet the feature
requirements.
The key benefit of outsourcing, Mr. Korkin says, is not
necessarily cutting costs. His major concern, aside from
whether he had all the necessary project management skills,
was whether he had the time to manage projects. In the
midst of saving himself time, Mr. Korkin found that his
decision to outsource also saved him money because the
58 PM NETWORK | JANUARY 2006 | WWW.PMI.ORG
Executive Summary
>
No longer the purview of just large
enterprises or government agen-
cies, project management can help
even the smallest businesses.
>
E-mail and data management
software firm Safe Data Tech-
nologies shows that outsourcing
project management can free up
valuable time.
>
Biopharmaceutical technology
company BioPAL illustrates how
documentation and research can
help keep projects profitable and
tied to business strategies.
>
SAP software reseller NWare
Technologies proves that communi-
cation skills can be critical to stay-
ing within budget.
With five or six projects going
on concurrently, it made
sense for me to outsource the
function and have someone
else manage the day-to-day.
That project manager makes
sure things are on time, are
done professionally and meet
the feature requirements.
manager kept all the projects on
task and on target. In addition,
Mr. Korkin is aware of progress
on a weekly basis.
But outsourcing the project
management function didnt mean
taking an entirely hands-off ap-
proach, he emphasizes. You have
to stay on target, or a project will
never end, Mr. Korkin says.
When I spec out a project, I try to
be as all-encompassing as possible.
Almost all software projects will have feature creep, additional
enhancements you see that need to be done to roll out the prod-
uct. I tend to budget an additional 10 percent into a project to
ensure we have funds and resources available to handle that.
With most of his products scheduled to hit the market late
last year and early this year, Mr. Korkin expected to wrap up
with his project manager before the end of 2005. However, he
is likely to contract with the same project manager for additional
work quite often as the business moves forward.
Milestones or Gravestones
With nearly $3 million in current grants, BioPhysics Assay Lab-
oratory (BioPAL) has significant project activity for a biotech-
nology company with only 10 people. The Worcester, Mass.,
USA-based laboratory receives much of its funding from the
U.S. small business innovation research (SBIR) program.
Were doing a whole lot more project management
than we realize, even though were so small we dont really
have a project management staff or even call what we do
project management, says BioPAL chairman Dennis Vac-
caro, Ph.D. But it is project management, and we cannot
live without it. We make do with what we haveunlike
larger companies that have the resources to dedicate funds
for project management. So we have to choose projects
that will pay off for us and stay on track so that we dont
waste money. Project management isnt a nicety for us
its life or death.
At the company, resources dont exist for a dedicated
project manager. Dr. Vaccaro and his two business partners
essentially take on the role of project managers as needed
for various tasks and pull other staff in as needed.
The company works backward by identifying the mar-
ket need for a product before even consid-
ering the idea of starting the associated
project. Whenever possible, the company
identifies projects that can be completed in
a few weeks or less by building off an exist-
ing product in the pipeline.
The SBIR grant proposal documents
provide a handy guideline for project
management, because research on
market viability, necessary timelines and
other issues are required. As such, the
SBIR documentation often serves as the
framework for managing a given project,
and timelines and milestones are
created to support the scope, Dr.
Vaccaro says.
60 PM NETWORK | JANUARY 2006 | WWW.PMI.ORG
Dennis Vaccaro, Ph.D., Chairman,
BioPhysics Assay Laboratory (BioPAL),
Worcester, Mass., USA
WE HAVE TO CHOOSE
PROJECTS THAT WILL PAY OFF FOR
US AND STAY ON TRACK SO THAT WE
DONT WASTE MONEY. PROJECT
MANAGEMENT ISNT A NICETY
FOR USITS LIFE OR DEATH.
Knowing which product to
develop or system to install
requires more than just a
hunch in todays competitive
landscape. Ultimately, [project
management] comes down to
making the right business
decision at the right time.
That concept really became clear
when we were awarded a fast-track proj-
ect for magnetic resonance angiography
work, he says. We had to set clear mile-
stones, and we told the SBIR funders
that if we couldnt make the milestones,
we would simply stop. The only way the
project could achieve fast-track was to
stay on target. And its that way with
most projects, even if they arent on an
accelerated timeline, because you dont
want to waste time pursuing something
that isnt going to be successful.
Communication and Control
For NWare Technologies, sale of a
product is only the first step, followed
by implementation work at the cus-
tomers site. The reseller and maker of
enterprise resource planning software
is based in Ville de Saint-Georges,
Qubec, Canada.
With only slightly more than 40
employees in three Canadian offices
and one U.S. office, dedicated project
managers are not feasible, notes
Claude Parent, president of NWare.
The companys six analysts pull dou-
ble-duty as project managers, typically
juggling two implementation projects
at once. The company accountant also
plays a double role, not only taking
care of routine financial matters but
also handling oversight of project
budgets and timelines.
Communication is key, Mr. Parent
says. Everyone must know what they
need to do and must let someone else
know where they are in a project. Along
with that, we all must document every-
thing we do.
NWare maintains the same commu-
nication philosophy with clients. You
have to communicate to the client
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exactly what will happen with the proj-
ect, Mr. Parent says. You need to tell
them, This is what we are going to do
first, and were going to work with this
timeline until the end of the project.
The last point, he says, is the most
critical: Clients must be restricted, he
says, for projects to be successful.
Although customer satisfaction is the
ultimate goal, Mr. Parent says, the cus-
tomers cannot and should not get all
they want at the expense of timelines
and project milestones.
We have what we call the nice to
have things, he says. Clients say, It
would be nice to have this, so why dont
we put it in now?You have to resist that
pressure, and you have to communicate
the need to stay on task. We have to let
them know we can do that for them, but
only after the scheduled project work is
done.You have to finish the main project
first, or the project as a whole will almost
certainly go out of control.
Part of that communication is mak-
ing the clients understand that every
addition to a project brings additional
costs, which can quickly mount up.
They will often say at first, Yes, we can
afford to go over budget, but then when
it comes time for them to pay, its a dif-
ferent story, he says. If you handle
changes at the end of the project, you
and the client will be happy because you
stayed within budget and perhaps went
under budget. Then there is a better
sense of what you can do and what they
can afford. PM
Jeffrey Bouley is a freelance writer based in
Saco, Maine, USA, and news editor of the PM
Network Stakeholders department. He has
contributed to Interface Tech News, Drug Dis-
covery News and Mainebiz.
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