Applying project management principles to business

Applying project management principles to business development Using best practices from project management to enhance successful outcomes and increase business development capacity.

Dr. Saadi Adra, PfMP, PgMP, PMP, RMP David Warley BSc, MIoD, CPP.APMP Fellow

July 5th 2014

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© APMP International 2014

Abstract Business Development (BD) and Project, Program and Portfolio Management (P3M) share many characteristics most notably in their life-cycle approach and objective of optimizing return on investment. This article examines some of the major P3M disciplines and describes how they may be applied to Business Development or bidding. It examines the similarities between the BD and Project lifecycles and introduces the concept of the Integrated Project where BD and project delivery are combined in a common lifecycle. It then identifies underlying P3M principles that can be applied to BD and presents them as a series of recommended best practices. The article was commissioned by the Association of Proposal Management Professionals (APMP) for inclusion in the APMP Body of Knowledge (BoK).

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Contents • •

• • • • • • • • • `

Introduction* Best Practices* 1. Integrate your BD and Project Management processes 2. Establish a controlled environment for your BD project(s) 3. Monitor the Continued Business Justification of your project 4. Build lessons learned into your project approach and plans 5. Create a functional organization based on Defined Roles and Responsibilities 6. Empower the project team to manage within defined limits a. Manage by Stages b. Manage by Exception 7. Focus on deliverables not activities 8. Make project management products an integral part of your offer document Application in Diverse Environments* 9. Tailor your method to suit the project environment Recent Trends Common Pitfalls and Misconceptions Summary* Terms to Know* Tools and Templates See Also (related sections in the BOK) References* Further Study Questions and Answers

Introduction* Bids are projects. They are temporary organizations, bid teams, established to achieve a specific organizational goal or business benefit: winning a new piece of business or achieving a specific objective or position within an account or market. Like projects bids must support corporate strategy and comply with governance requirements. In approving bids or pursuits, management seeks to optimize the return on pre-sales investment. The discipline of qualification is therefore closely linked to portfolio management. Which bids and pursuits will give us the best return? There is a well-researched and documented body of best practices related to project and portfolio management. This provides an accessible source of help and experience to improve our Business Development (BD) performance. By adopting and applying best practices used by project managers, we will increase the chance of a successful outcome for our bids. Many of the techniques used in bid management already have their

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counterparts in project management. And by de-mystifying bid management, we gain access to an existing resource of skilled professionals, our project managers, thus expanding organizational business development capacity. Two perspectives are covered within this section: -

Integrating the business development lifecycle under the umbrella of portfolio management, what is recently called organizational project management. Managing Bids as projects (that is using project management best practices by the bid or proposal manager) to assure successful outcomes.

Integrating your BD and project management processes will provide your organization with a source of sustainable competitive advantage as the lessons of project delivery will inform the early stages of proposal, solution and price development. Applying the disciplines of portfolio management will assure that limited resources are used to achieve optimal return. Portfolio Management will provide the organizational umbrella for eliminating silos and integrating business development and project execution for organizations to succeed and prevail.

Best Practices* 1. Integrate your BD and Project Management processes Sustainable competitive advantage depends on embedding best practices as part of an organization’s way of working. • • •

Applying good PM practices on an individual pursuit will enhance its prospect of success. That at least provides the means of achieving repeatability. Leveraging Organizational Process Assets so that all pursuits follow a common process makes that success sustainable. Aligning pursuits (BD projects) with organizational strategy optimizes returns from investment in BD projects.

Exploiting the synergies between strategy, BD and delivery enables the win-win-win outcome illustrated in Figure 1.

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Figure 1 Figure 1 Business Development and Project Management Relationship. Correctly managing the synergies between BD processes and Project Delivery is a determining factor in achieving organizational success and profitability.

Organizations do not succeed by chance. It requires collaboration between several entities within in order to succeed and make profit, but for our topic, focus is on the integration and collaboration between BD and PM within a governed and controlled environment. BD like to win new jobs, and this is essential for the survival of the company. Proper execution is also essential albeit for earning the awarded business revenues and for building a good image for recurring and other clients. Hence both PM and BD rely heavily on the professionalism of own and each other delivery. The other important collaboration is required not only for success in delivery and having happy clients, but also for having happy shareholders, which is making some good profit at the end. Making profit requires a well estimated breakdown for the scope of work being proposed and then delivered, taking into consideration the cost of risk and/or opportunity. For this to occur, the organization should own the following capabilities:

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Competent BD personnel

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Competent PM personnel

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Mature Organizational Project Management Methodology

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Portfolio Governance


A mature organizational project management methodology will implement an Integrated Project Lifecycle. The Integrated Project starts at the lead/inception and ends at hand-over and clearance, passing through the different phases of business development and project execution. To support the above Portfolio Governance processes monitor the mix of projects to optimize return and maintain organizational knowledge. Organizational knowledge comprises the knowledge generated by BD, PM and other Technical and Administrative Units both in lessons learned and intellectual capital created. Figure 2 shows the connecting relationships that require successful proposals with successful project execution, knowing the real cost and setting a price to win proposal, managing execution risks and still leaving a margin for profit at the end.

Figure 2. Avoiding Silo Decision Making By aligning both BD and PM to strategic goals, PM will benefit from BD by having better estimates, and BD will benefit from PM by cycling the knowledge across the organizational units from PM to BD, instead of the standard silo-based knowledge warehouse practice.

The Integrated Project, whose scope and relationship to the BD lifecycle is shown in Error! Reference source not found. is not an accidental outcome. It is the result of the strategic intended alignment process under portfolio management for achieving organizational objectives through successful projects. The Integrated Project can be initiated either for raising the Demand pipeline within an organization for achieving commercial objectives, or for building the capabilities/capacities within the Supply Portfolio for achieving longer term strategic objectives.

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Figure 3 Business Development Projects need the right scope. Mature organizations operate an integrated project lifecycle where strategy formation at the Pursuit stage benefits from earlier lessons learned in delivery. This can be contrasted with the more typical situation, lagging or emerging projects, in which consideration for the delivery project starts late in the business development cycle.

Integrated Projects are key for growth and strategic achievements, whereas Emerging and Lagging projects provide interesting tactical benefit generation – usually, the more the organization is mature, more of an enterprise, it is more likely that their projects come from partnership and sustainable agreements, hence are Integrated. The difference is that Integrated are planned ahead, hence can fully utilize the benefit of integration with project-driven discipline, whereas lagging are response driven and might need to cut short on some corners, hence aim towards profit generation, which is questionable. Alignment through Portfolio Management

The objective of strategy is to maximize value. Projects, including BD projects, are part of a portfolio of investments that the organization can make. Portfolio Management, whose concern is optimization of investment, thus provides a model for integrating BD and delivery projects. The PMI Standard of Portfolio Management provides a useful framework to implement the model as shown in Figure 4.

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Figure 4 Portfolio Management integrates BD and Projects. The portfolio management processes provide a framework for integrating business development and delivery processes.

When both BD and PM speak the same language and use similar tools, the flow is smooth, and highly beneficial twofold; BD can do the detailed planning and move into execution in a quicker and more accurate manner with less disruptive changes, and the lessons learned – not necessarily captured at the end, but is an ongoing activity – captured during execution will benefit both PMs and BD, especially for future similar projects. This is a core aspect of Organizational Maturity.

2. Establish a controlled environment for your BD project(s) Every project needs the right environment to succeed1, BD projects are no different. The competitive bidding environment provides sufficient uncertainties to challenge the most talented project managers. Senior management should assure that the internal environment is controlled so that pursuit teams can concentrate on winning. This mandates a mature governed-process system. Actions senior management can take to achieve this include: •

Establish clear rules and criteria for the authorization and start of BD projects

This and succeeding best practices in this article address the management of individual BD projects. We have used the principles and terminology of the PRINCE2™ project management framework. While the terminology is specific the principles are universal and compatible with other bodies of knowledge eg PMBoK. 1

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• • • • •

Align project decision points with the BD lifecycle and major bid decisions Provide authorized BD projects with appropriate sponsorship and adequate funding Establish clear controls and limits within which project managers can operate. Tailor controls appropriately to the size and nature of each project Support project teams with appropriate process and guidance (organizational process assets)

Controls can be set on, among other things, project size and value, risk, cost, timing. quality and scope as shown in Figure 5. What is important is that the rules should be flexible but clear and be applied consistently.

Figure 5. Controlled Environment. Establishing a controlled environment for your BD projects provides your pursuit teams with the conditions they need to win. Their focus can be on the Prospect as opposed to managing the internal organization.

In a controlled environment (mature organization) the following behaviors prevail: • • • • •

Projects support the business strategy and align with corporate goals Projects start only after clear approval and have clear owners Projects have clear success criteria Everyone knows what projects are being worked on Lessons are learned and products archived for re-use from all projects, even un-successful ones

All the above are attributed to proper Portfolio Management within the organization. In an un-controlled environment the following behaviors are observed • • • •

Projects are started without clear justification, ownership or funding Management constantly request additional information and detail at approval points. Project managers are given conflicting or multiple reporting requirements for the same information There is no clear view of what projects are in progress at any time

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Projects are abandoned, as opposed to an orderly close-down. Nothing remains except the costs.

Organizational process assets (OPAs) and organizational maturity for BD Projects

Having a documented, supported process for project management enables repeatability and implementation of lessons learned by project managers. In accordance to BD-CMM Rev. 2, this supports Level 2 sustainability objectives (Managed Process). Providing project managers with guidance on how to tailor project controls appropriately for each project makes the process flexible and scalable. Organizations will achieve Level 3 sustainability objectives (Defined Process). Project Managers in mature / controlled environments will be able to tailor their management controls appropriately to each case. This provides certainty, avoids unnecessary overhead, and eliminates bureaucracy. Project managers will be able to focus on the project as opposed to managing the organization.

3. Monitor the continued business justification of your BD project Every project requires a reason for doing it. Bids are no different, there must be a sound business case for bidding. The case need not be financial, often we will bid for position, but the business case must still be valid. The business case drives the project. As our knowledge of the project requirements, the costs and the risks increases, or as the situation changes, a project that had a good business case at the outset may cease to be justified. Projects that lack justification should be terminated. A project manager does not have authority to terminate a project but is accountable for monitoring its continued business justification. Termination, just like Chartering occurs at the Portfolio Level. When, in the PM’s evaluation, the project no longer meets the business case for which it was started, they should escalate this to senior management and either: • •

seek approval for a revised business case or seek permission to terminate the project.

The decision rests with management, but a project manager fails in their duty if they do not seek it. Application to business development and proposal management

Qualification is the process by which the business case for BD projects is tested. This should be a continuous process documented in a live business case, as shown in Figure 6.

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Figure 6 Qualification as a continuous process. Qualification and the business case are continuously tested as the situation and our knowledge of it develops. The focus is on whether the business case is still valid and whether we still have a strategy that can win. The project manager maintains the business case as a live document and checks that it is still within approval limits.

Qualification and strategy interact. The win strategy, or project approach, should be tested to assure that it still wins. Similarly, the view of costs and risks must be kept up to date. This includes the pre-sales costs and risks as well as those for the delivery. Pre-sales costs are an investment and the investment must still be worthwhile. This emphasizes the need for Integrated Lifecycle that includes both BD and PM under the umbrella of one governed Portfolio. Ultimately, while the project manager is involved in tactics and operations, the portfolio manager has a broader holistic view in a comparative manner, as he monitors the enterprise environmental changes/factors and as well the health of the project with respect to the other projects, and in alignment to organizational goals. A continuous or recurring concern like this in project management is called a management theme. Qualification is perhaps the most important management theme in business development because it goes to the heart of business justification for bidding. For further discussion see APMP BoK Qualification and APMP BoK Strategy Development.

4. Build lessons learned into your project approach and plans Knowledge capturing is not easy, especially within silos. When BD and PM have an Integrated standard, then it is much easier to track the estimate on a specific activity for example from BD, which is decomposed more during planning, then controlled or not during execution. The details collected as Actuals’ during execution are rolled-up to their master caption and fed back to BD. BD can compare their original activity estimate with respect to the actual during implementation. This formulates much better base of knowledge for making more realistic decisions in the future, especially when encountering similar activities. This helps in a better assessment for risks, hence prices can go lower for a better competitive position or in other cases, the margin can go up. Both are quite joyful benefits.

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These benefits require a standardized integrated and governed project management lifecycle that starts at BD as shown in Figure 7.

Figure 7 Implementing Integrated Knowledge Management. Lessons learned collected by PM for past projects can be utilized for better decision making by BD for new projects.

It is easier to communicate back and forth. i.e. execute knowledge management and have BD learn from PM execution when the method, process and structure are similar, i.e. use same WBS or CBS, Scope/ Technical Specifications, Quality Standards, Resources, Initial Estimates, Prices/Durations, Master Schedule, Vendors and Sub-contracts, Constraints, Assumptions, Stakeholders and Risks. Actions that management can take to support this process include: • • • •

Implement a common process across BD and Project delivery so that common products and artifacts are created Make Review Lessons Learned a required step in each planning process and the start of each major step in the project lifecycle. Have a Lessons Learned Incorporated in this Plan as a required section in each plan document. Plans here includes those created as part of BD Support the process with training, accessible guidance suitable templates

This will assure that knowledge acquired on projects is part of lessons learned, not just lessons noted.

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5. Construct a project functional organization for each project, based on Defined Roles and Responsibilities A bid, like a project is a temporary organization. It will typically cut across organizational and functional boundaries and have reporting lines additional to members’ normal lines of management. The project manager therefore needs to establish a clear functional organization and reporting structure for their project so that project members know who is doing what and from whom to seek direction. The project functional organization should address all the levels of management as shown in Figure 8. Direction Level - Portfolio •Represent Business, User, and Supplier Interests •Secure Project Sponsorship,Budget, and Resources •Authorise project stages and plans •Exercise Governance and set tolerances Manage Level (Core Team) - Project/Tactical •Manage the project day to day, control delivery and acceptance of project products •Develop and maintain management products (Strategies, Plans, Budget, Status Registers etc) •Provide reporting and support functions •Lead and direct specialist teams. Manage work packages. Deliver Level - Technical/Functional •Provide specialist knowledge and expertise •Create individual project products Figure 8 Management Levels and Accountabilities. The project organization should address all levels from the workers to senior management. At the senior management (Direction) level all the major interests of the business should be represented.

The Direction level identifies the senior manager or managers who will be responsible for the oversight and funding of the project. This level is sometimes referred to as the Project Board. At this level the focus is on setting direction and exercising governance. Day to day management of the project is delegated to the Project Manager. This level is either carried on by Portfolio Management or reports to Portfolio Management System. Within Large Programs, this layer could be the level of the Program Governance Board, supported by the Program Manager Office. This is tied to the Governance model and structure that is utilized by the organization At the Manage level the Project Manager (PM) may be supported by team leaders who take responsibility, under the PM’s direction, to manage an area of the project. The PM and team leaders form the Core Team for the project. The PM may also be supported by a Project Office that will discharge various admin and support functions. At the Deliver level are the specialist resources and subject matter experts who will develop or source the project products/deliverables.

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Designing a functional organization

What has been described so far are the roles that must exist in any project. For each project the Project Manager has to map those roles on to real resources to establish a functional organization for the project. Figure 9 shows an example of a typical functional organization. 2

Figure 9 Project Functional Organization. The Project Functional Organization establishes a clear reporting structure for the project. The design is based on roles that define accountabilities and skills required. In implementing the functional organization, named resources are assigned to the roles.

Note that following this approach it is recommended that organization charts identify all required roles and for each role the person who holds it. In a small team a single person may hold many roles and therefore their name appear several times. The organization must be scaled in size and complexity according to the needs of the project. Roles can be combined to reduce organization size or split across multiple resources when size demands it. Table 1 provides an example of ways that the organization might be scaled according to project size.

The role names used here are taken from the PRINCE2™ project management framework and may vary according to implementation within each organization. In other context Power User is equivalent to SME – Subject Matter Expert. 2

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Direct

Small Project Executive Also takes on the Senior User and Supplier Roles

Manage

Project Manager Also takes on the Project Office and Team Leader roles

Deliver

One or more individuals perform tasks at the PM’s direction

Medium Project Executive Supported by one or more senior executives

Large Project Executive Supported by stakeholder groups to represent User and Supplier interests Project Manager Project Manager One or more Functionally specialists support the specialized teams PM in Team Leader Formally defined and roles staffed Project Office Groups of specialists Formally constituted work to the direction teams deliver work of one or more team packages under the leaders direction of full time team leaders

Organogram thumbnail

Table 1 Scaling the organization. By splitting and combining roles the size of the functional organization can be tailored to the project environment. Provided that all required roles are represented and that holders have the skills and capacity to discharge them, the organization can be any size from two members to hundreds.

The smallest possible organization consists of a Project Manager reporting to a responsible senior manager. In this situation, the project could be considered as a task and its delivery as “business as usual” rather than a project. Organization and the project lifecycle

No situation is static and the project organization will need to evolve as the project progresses. The organization should be reviewed at the start and end of each project stage. Lifecycle points at which review is appropriate include: • • •

Start-up – who should manage this? Initiation – what resources will we need? Start of a new stage – are the resources in place to deliver?

At any one stage there can be only one Project Manager. It is good practice to maintain continuity of project management throughout the project’s life. Nonetheless, organizational review should also ask the question, “Do we have the right management team for the next stage?” and be prepared to change as needed.

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Application to business development and proposal management

Representation of business interests Business development projects have special interests and it is important that these are properly represented in the BD project organization. The senior manager, in the role of Project Executive, has accountability for looking after the business interest and particularly for compliance with governance constraints. The User and Supplier interests also need special consideration. The User of the proposal is arguably the Sales function in that they want a proposal that wins. The proposal must also meet the Prospect’s requirements and so the Sales function is an appropriate proxy for the Prospect in the Senior User role. The Supplier interest will normally be represented by the functional manager who has to supply the delivery resource. In a situation where the organization is teamed with external partners it is appropriate to consider how those partners’ interests will be managed and who within your organization will represent them. That may introduce additional functions, for example Supply Chain or Partner Management, as stakeholders in the Senior User role. Organization evolution throughout the BD lifecycle A BD project will change throughout its lifecycle and the bid’s functional organization and staffing needs to evolve and be planned and reviewed accordingly. At the Opportunity Analysis stage it is important that the correct level of sponsorship and funding is secured. The identification of the appropriate Project Executive is a key decision. During the Capture stage the project will typically be small and led by someone in the Capture Manager role. At this stage therefore we can say that the Capture Manager is in fact the Project Manager during the Capture stage. As the Proposal Stage approaches the organization will grow and new skills will be required to manage the opportunity through the proposal stage. At this point it is worth considering a review of the project organization and especially how the relationship between the Capture Manager and the Proposal Manager will operate. All of the following are valid options that have been encountered in successful bidding organizations: • •

•

The Capture Manager continues as overall project manager and is supported by a specialist Proposal Manager to lead the production of the Proposal as a work package. The Capture Manager joins the Direction level and takes over some of the Senior User role. The Proposal Manager takes over the project manager role for the duration of the Proposal Phase. The Capture Manager takes a role within the Core Team focusing on strategy and message to the customer

Similar considerations apply to who should lead as the bid moves from the proposal stage into negotiation and handover stages. At any one moment there must be only one responsible project manager and the reporting lines in the project functional organization must remain clear.

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Core team members and common proposal team roles The team leader role may exist in several forms according to the holder’s specialization. For example the manager responsible for the technical content of a solution might have the title Technical Manager. In a proposal team these roles can often be defined around the component products of the offer document; they may have titles such as Volume Manager. In each case the core accountability is the same, they have to manage individual contributors and take ownership for the delivery of a major component of the offer. Embedding good organizational design practices

To support the process of effective organizational design organizations should: • • •

Maintain a clear set of role descriptions for project (and bid) roles Identify the skills required for each role Provide suggested mapping of roles to the functions within their organization

For further information on this topic refer to APMP BoK Individual and Organizational roles

6. Empower the project team to manage within defined limits The project team has to be empowered to manage. Constantly referring up to management for permission or authorization is a recipe for paralysis. Management cannot abrogate accountability and so a sound framework has to be established for delegation. The key enabling concepts are management by stages and management by exception. Manage by Stages

There are practical limits to the time period over which detailed, high confidence planning can be done. This is a fact of life. Nothing in life or projects is certain and the further away a thing is in time the less certain it is and the less precise our knowledge of it. Project managers limit their planning horizon to what is realistic for detailed planning. Beyond this they make outline plans, supported by assumptions as necessary that are realistic but essentially contain greater uncertainty. The time over which detailed planning is sensible determines the length of a management stage. How long this time is depends on the project and the business environment. Three to six months might be reasonable for a long project in a stable environment. In volatile, rapidly evolving situations shorter stages will be required. Note that what is being described are management stages as distinct from inherent technical phases within a project. Having prepared detailed plans for the next stage the PM seeks approval to proceed. Management reviews the detailed plan and the assumptions for the stages beyond. Based on the plans presented, Management gives or withholds authority to proceed to the end of the next stage. The PM must seek new approval to before proceeding to following stages. In this model, the Initiation processes in which the project manager develops the overall project plan and detailed plans for the first stage, should be considered as a management stage. No project should start without an approved project plan.

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Manage by Exception

Within a management stage the Project Manager, supported by the team, are empowered to get on with the project if it remains within approved limits. Management sets those limits, stage by stage and subject to normal assurance processes, manages by exception.

Figure 10 Setting Limits and Tolerances. The model of defined limits and tolerances and management by exception provides the environment in which the team is empowered to manage at all levels of the organization.

Limits can be set on scope, cost, risk, benefits, quality and progress. For each of these Management may define a degree of tolerance that provides a level of discretion to the project manager. Limits and their tolerances are subsets of the authority delegated to Management within the organization’s scheme of governance. Delegated authority limits can change with the prevailing business situation. That’s life. Within the project it is the Project Executive’s accountability to be aware of current limits and set tolerances for the project manager accordingly. The project manager supports the Project Executive in this duty by providing up to date plans and honest forecasts of the stage and project end states. The project manager monitors the project status day to day and updates the forecast both for the current stage and for the end-point of the project. If any of the controlled items are forecast to be out of the tolerance provided, the project is in exception. If the PM finds or forecasts that the project is in exception, they must escalate to Management to seek new authority, permission to terminate the project or approval of an exception plan. Exceptions should be exceptional. Projects that are continually escalating to Management for new authority or to deal with issues are out of control. Governance rules that cause constant stage and project tolerance variations are symptoms that the project environment itself is not controlled. That is an issue for senior management. Application to business development and proposal management

Application to long pursuits, relationship to the BD lifecycle Management by stages is appropriate to control long pursuits where there are no external or internal events prompting a review. This may be set by time or synchronized with a scheduled pipeline / portfolio review.

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Management may approve a pursuit knowing that the duration of the Capture phase may be extended. It will be appropriate to set a time limit after which Management can take a view on whether the opportunity is making sufficient progress or and still has a justified case for bidding. A stage boundary may also be imposed by the BD process. For example: • •

externally the issue of a customer solicitation or internally completion of a technical activity like outline solution design

are events that can mandate a stage review before proceeding further. The empowered bid team, the benefits in fast moving negotiations A recurring issue during post submittal activities is the management of change during fast moving negotiations. The customer facing team needs to be able to respond to the demands of negotiation without constantly referring back to management. In project management terms the process at the heart of negotiation is Change Control. This provides a well-defined process for routing, impact analysis and approval within a project organization. The model of defined tolerances and management by exception illustrated in Figure 10 provides the framework for empowering the bid team to negotiate while complying with the constraints of governance. The members of the negotiating team need to have the right knowledge of the offer, the solution and the ability to assess impact of change on the offer, the supporting business case and whether the bid remains within the tolerance set by management. People with this mix of skills are rare and they should be nurtured within the organization.

7. Focus on deliverables not activities To manage a project effectively it is better to focus on what has to be produced (Products or deliverables) rather than on what has to be done (Activities) to create them. Products are visible, they’re either finished or they’re not. Contrast this with activities for which the only real test of completion is often the existence of the products they create. Basing your plans around deliverables or products will provide several distinct advantages: • •

•

•

•

You will have a better handle on the status of your project in terms of what it is meant to deliver. A product status register allows you to track what’s finished and what’s not. For each deliverable or product you will be able to establish acceptance or quality criteria. This allows you to plan quality assurance (QA) activities around deliverables and what defines their fitness. Using a product based approach to QA enables you to scale the process appropriately. Product quality criteria provide a basic checklist for which you can select appropriate quality methods ranging from simple inspection to formal review For each product you can assign ownership of the person or team that is producing it. This provides a simple mechanism to control progress. Each responsible owner reports on forecast delivery and status. Products provide a straightforward basis for tracking configuration and controlling change. Products are configuration items whose issue and status can be recorded and tracked.

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Changes can be assessed in terms of the products that are impacted and the dependencies between them.

Figure 11 Basic Tools of Product Based Planning. The Product Breakdown Structure(PBS) allows you to analyze the scope and completeness of what has to be produced. Product Descriptions (PDs) provide the purpose, composition and quality criteria for each product while the Product Flow Diagram (PFD) identifies dependencies and the sequence in which products need to be created.

Analyzing what your project must produce in terms of a Product Breakdown Structure and then documenting this in Product Descriptions will provide you with the means of control. Product descriptions form the basis of a ‘contract’ between you and the producer. You define what you want, what it should contain, how it should be presented and the standards by which you will accept it. The producer contracts to produce what was asked for, to the standards required, at a given time and cost. Product based planning approach

Products provide the link to planning. The overall deliverable for the project is its top level product. This ‘project product’ can be broken down into its constituent products, the sequence of products analyzed and delivery of products allocated to the various project stages. The relationship between product based planning and the overall planning process is shown in Figure 12

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Figure 12 Product Based Planning Process. Product based planning starts with the Product Breakdown Structure. Creating Product Descriptions provides the detailed composition and quality criteria of the required products. This is the basis for scope definition and estimation. Dependencies between products are captured in the Product Flow Diagram. This can help in identification of risks and support impact analysis for change requests.

Plans are produced in a level of detail appropriate to the point in the lifecycle and the proximity of the stage or activity being planned. This is defined at the beginning in the plan format. The planning process focuses on what has to be produced. This is captured in a Product Breakdown Structure. The estimating process is informed by the detail and complexity of the products as captured in Product Descriptions. Dependencies between products identify areas of potential risk and provide a sequence for activities. Managing a project involves producing not only its specialist products or outputs. A number of management products are required to document and manage the project. Plans are an example of management products. Application to business development and proposal management

The BD process, management and specialist products Like any project management process a BD lifecycle will define a required set of management and specialist products that should be created at each stage. A Capture Plan is an example of a management product. An Outline Solution is an example of a specialist product. The BD process can therefore be documented in terms of its stages and the products that have to be produced. For example: • • • •

A Capture Plan would be required as the output of Opportunity Analysis An Outline Solution would be required as an output of the Capture Stage A Proposal Management Plan is the output of Proposal Planning A Closure Plan is the output of the Proposal Stage

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All of these required products and the many others required internally can be described in terms of product descriptions which include their composition and quality criteria. Planning then becomes a process of identifying the number and level of detail of the products that have to be produced in each stage and agreeing these in a documented, approved plan. Proposal Content Planning The proposal document is the major product of the Proposal Stage. The techniques of Product Based Planning are familiar to Proposal Managers under other names: • •

The Proposal Outline is a Product Breakdown Structure for the Proposal A Section Content Plan or Storyboard is a Product Description for a proposal section

A project manager familiar with product based planning can readily adapt this skill to the proposal environment given suitable knowledge of the quality criteria. Refer to APMP BoK Content Development Plans for more detail on this topic. Quality Management and Reviews Standard management products, eg the Capture Plan and Proposal Management Plan, have product descriptions that contain their composition and quality criteria. The project / proposal manager develops the product descriptions and quality criteria for specialist products like proposal sections. There is a flow down of quality criteria from some products to others driven by their derivation as shown in Figure 13.

Figure 13. End to End Quality. Quality cannot be added on at the end. It has to be built in through a quality process applied to all the products created throughout the bid lifecycle. Each product defines quality criteria for later dependent products.

• • • •

The Account Plan should describe the customer issues, motivators and value winners. The strategies in the Capture Plan should address the customer issues documented in the Account Plan The Outline must be compliant with the Prospect’s bidding instructions and response requirements The Win Themes used in the Content Plan should be the same as those in the Capture Plan

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The content of a Proposal Section should meet the quality criteria defined in its Content Plan

Using this product based approach to business development planning enables a flexible quality review based approach to assurance. This is as contrasted to imposing expensive, time consuming, ‘pens down’ team or color reviews. Quality reviews can use any appropriate quality method to check the product. Methods can be simple, like a checklist based inspection or complex, like a team review. The Project Manager decides the appropriate level, documents this in their Quality plan and agrees the plan with management. Management implements assurance by checking that the Project manager follows the agreed plan. This flexibility in approach both empowers the Project / Proposal Manager and is adaptable to fast moving short turn-round proposal environments. The Quality plan need not be a complex document. It need only list the products to be created, their main quality criteria, the quality methods to be used and the quality responsibility (who will check). In this tabular form it resembles a product register. With additional columns for status and plan date it can capture all the essential elements of the Quality plan. In some proposal methodologies this approach is described as Proposal Validation and the extended register is known as a Proposal Validation Plan.

8. Make project management products an integral part of your offer document The prospect is intensely interested in how you’re going to manage the project. You should SHOW them not TELL them. Many responses to what is often described as the Management Volume provide detailed descriptions of management processes without providing specifics of WHAT will actually be done and WHO will do it.

Figure 14 Conflicting Claims of the Offer and Contract. Sometimes the negotiation process results in a contract that conflicts with the intent of the proposal and neither reflects agreed pragmatic approaches adopted as part of delivery. Which one prevails?

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Figure 14 3offers an admittedly cynical view of the two main proposal deliverables, but experience shows that too often the negotiation process can harm the integrity of the solution or that the solution and contract are not aligned. When in dispute which document takes precedence? In an Integrated Project some beneficial things happen. By: • •

applying project best practices in the proposal creation, and creating some of the project definition documents as part of the proposal,

you will be demonstrating rather than just describing how you will manage the project. SHOW don’t TELL is a good proposal principle. In some markets it is common for specific management products to be a mandatory part of the submission. Compliance with the Prospect’s request in this case is the only option, or risk disqualification. In the Emerging or Lagging project it’s common to include the Statement of Work (SoW) as part of the contract. This may include relatively minor points e.g. reporting frequency or format. Once in a working partnership with the customer more pragmatic arrangements may be implemented that suit both sides. Without raising a contract change, with all that implies, such agreed arrangements can constitute a breach. In an integrated project the contract the SoW can focus on what has to be delivered (the products) and their quality attributes (including time and cost) Working arrangements can be captured in the Project Initiation Documentation which forms the joint basis for collaboration. In the Lagging or Emerging project it is too late to introduce this way of thinking through the negotiating process as both requirements and the Prospect’s selection process are already fixed.

Application in Diverse Environments* 9. Tailor your method to Suit the Project Environment[DW1] APMP best practice recommends that proposal processes be scalable and flexible. The project management world provides us with ready to hand guidance on how to apply that advice Scale your implementation around the management themes, time available and key milestones

Management themes are recurring concerns for the project manager, things to which they will devote time and attention regularly and frequently throughout a project as shown in Error! Reference source not found.. The rigour and detail with which they address these themes are things that can be tailored in the Project Management Plan.

This drawing was first presented at the APMP International Conference in 2009 in the paper “Proposals in Controlled Environments”. The concept author is Andy Murray of Outperform UK Limited. 3

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Figure 15 Management Themes. The project manager must consider the detail and rigor with which they will approach the management themes for their project. Their management plans form the basis for agreement with senior management on how the project will be controlled and what documentation is required for later approval.

In the bid management context Qualification and Strategy are a further theme closely linked to the Business Justification theme. Available time and imposed schedule dates from submission deadlines and set dates for management reviews will also affect the degree of tailoring. Secure approval of your management plan at project initiation

Once the approach to dealing with the management themes has been developed for the project, the PM then gets approval from senior management for their plan. The PM then follows the management process for their project as documented in their plan. Organizations supporting this approach demonstrate progress to Sustainability Objective Level 2 of the BD-CMM when this is applied to BD projects. Reference: BD-CMM v2.0 SO2 (Managed Process) Establish tailoring guidelines and sizing templates to support project managers

In a Level 2 organization the PM depends on their own skill and judgment to tailor the management plans. Organizations that provide project managers with guidelines and templates for applying the tailoring process and support these with help and management review move further towards attainment of Sustainability Objective Level 3, BD-CMM v2.0 SO3 (Defined Process)

Types of organizational environment Proposal Development is highly affected by the type, structure, industry, culture and organization of each significant company, hence there is no one-size-fits-all. The ability of the individual manager to apply the principles described here will be strongly impacted by the relative influence of project managers within the organization.

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• •

•

Functionally or operationally structured. PM influence typically low and ability to change is small Matrix structured PM influence low to medium. Ability to affect change limited or at local / departmental level Strong matrix with specialist Project Management function PM influence high. Ability to effect change high.

In some industries, such as Systems Integration, it is quite common for project execution teams to manage new proposals and develop them as projects with the potential of becoming awarded contracts, then executed as projects. In many other areas there exists a gap between the two realms, separated by either the contract award in case of contractual relationships and allocation of funds in case of corporate internal program development. This gap has caused several organizations to fold or lose a lot; a way for companies to make profit off revenue is to own the capability to develop a Dual-Win proposal; a good proposal should be approved by the client and lead to a contract, but that by itself is not enough. Sometimes, Business Development staff are driven by quarterly quotas, targets and motivated by commissions that the big picture could be jeopardized if not managed closely in a controlled manner. The winning proposal should enable the execution team to implement in a risk-balanced manner that can preserve a portion of the revenue to be concluded as profits. No one likes a winning proposal that causes financial losses during execution neither one that does not generate solid benefits.

Recent Trends Agile project management The growth of the Agile project movement provides a new and growing body of useful experience for the proposals environment. The Agile Manifesto embodies many principles that could usefully be applied in proposals. The Twelve Agile Principles: 1. Our highest priority is to satisfy the customer through early and continuous delivery of valuable software. 2. Welcome changing requirements, even late in development. Agile processes harness change for the customer’s competitive advantage. 3. Deliver working software frequently, from a couple of weeks to a couple of months, with a preference to the shorter timescale.

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7. Working software is the primary measure of progress. 8. Agile processes promote sustainable development. The sponsors, developers, and users should be able to maintain a constant pace indefinitely. 9. Continuous attention to technical excellence and good design enhances agility.


4. Business people and developers must work together daily throughout the project. 5. Build projects around motivated individuals. Give them the environment and support they need, and trust them to get the job done. 6. The most efficient and effective method of conveying information to and within a development team is face-to-face conversation.

10. Simplicity—the art of maximizing the amount of work not done — is essential. 11. The best architectures, requirements, and designs emerge from self-organizing teams. 12. At regular intervals, the team reflects on how to become more effective,then tunes and adjusts its behavior accordingly.

Table 2 The Principles of the Agile Manifesto. Substitute the words “proposal content” for “software” and you have a charter for proposal teams everywhere. The timescales in Principle 3 would, of course, need to be shorter.

Techniques originally developed to support software development are, with minimal adaptation, applicable to the development of proposals: • • •

User stories communicate requirements in a succinct, customer focused manner Prioritization (MoSCoW) allows the team to focus on high value content with no compromise on quality Time-boxing supports the absolute commitment to a no-slip schedule

Tools created to support team communication embody existing APMP best practices of visual communication. • • •

Burn down charts communicate status Backlogs record the work still to be done or planned for later Kanban charts visualize the process and communicate where in the process a particular story is and who currently has responsibility

In DSDM project teams tools like these are used to create a team ‘information radiator’ that keeps the whole team aware of status and progress. The ecosystem of tool developers and service providers that has grown up around Agile means that project managers have a rich source of automated tools and services to support their implementation of these techniques. These can be used adaptively without need for wholesale adoption of Agile as a methodology.

Online collaboration tools Geographically distributed, as opposed to co-located project teams are the now the norm, a similar trend is visible in proposal teams. The project management industry is now supported by a rich choice of tools and services deployed over the Internet. Services range from point solutions aimed at small teams, to enterprise strength offerings that integrate with other corporate platforms. All support online collaboration features to enable team members to share status, report progress and contribute to discussion. Many include features to support collaborative creation and development of documentation and other products. None of these tools change the underlying principles of project management described above. But all expand the range of options available to management, the project office and the project manager to implement support for distributed working and more effective collaboration inside teams. See

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ToC based scheduling (Critical Chain) Application of the Theory of Constraints to project scheduling has shortened time to market and development lead times for many businesses. Critical Chain scheduling is well documented and supported by commercial project management tools but is not yet widely adopted outside a few specialized environments. The promise of shorter lead times and more robust development schedules is one that holds attractions for proposal managers. While many disciplines from manufacturing, to supply chain and distribution have been transformed by the Theory of Constraints, its application to Business Development remains an area for further research.

Organizational Project Management The concept of the Integrated Project introduced at the beginning of this article is more widely described as Organizational Project Management(OPM). Businesses that practice OPM implement an integrated lifecycle from business development, award, through execution to closure. Existing bodies of knowledge, PMBoK and models, OPM3 continue to be developed and best practices researched. As more businesses adopt an OPM approach, Business Development and its practices will increasingly be driven by the precepts of OPM.

Common Pitfalls and Misconceptions Rigid implementation Of their nature project management methodologies are heavy duty, capable of supporting high value, high risk endeavours. The supporting documentation and processes that enable this are similarly heavy weight and comprehensive. This can lead to two possible negative outcomes: •

•

An organization imposes a heavy weight process on every opportunity regardless of size or complexity. The result is that the effort devoted to managing small projects or proposals is disproportionate to their value. Project and proposal teams find work-arounds for the perceived over bureaucratic process and use lighter approaches using their own view of what’s appropriate. Repeatability and commonality of approach is lost. The organization has a great documented process but no-one follows it.

Over focus on the process Project management is essentially about managing people, whether they are stakeholders, suppliers, customers or colleagues. It is easy to fall in love with the techniques and process of project management rather than focus on the goal, a successful project or a profitable contract. Successful project and proposal manager behavior is not to sit endlessly refining plans or-rescheduling when issues arise, but to pick up the ‘phone and talk to whoever has the issue. Successful management behavior is not to focus on process compliance or assume that detailed reports mean all is going well. Management’s job is to ask penetrating questions at the right time, and then make sure the team has what’s needed to win.

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Reluctance to engage with Project Managers Project Managers want to have realistic, achievable plans with budgets that cover the real costs and risks. Sometimes this behavior is viewed as negative, leading some to avoid engaging with PMs until late in the cycle. At first glance this can seem irrational but will be rooted in a real underlying concern. The effective PM will understand and plan to address the concerns of all the stakeholders.

Anti-patterns Just as there are good patterns of behavior that we would like to embed, in the project world there are also anti patterns that we would like to avoid but which can easily become entrenched. The following are familiar PM anti-patterns that have their equivalent in the proposals world: •

•

Analysis paralysis Similar to over focus on the process, we spend our time arguing about the best solution or requesting further information before committing. When the time comes to deliver, we are not ready. Death march project Sometimes known as the Old Man Syndrome. The CEO has signed off on this project and expects us to win. We all know it’s hopeless, but we carry on to the bitter end.

Summary* By applying project management best practices in our business development projects we will: • • • • •

Gain sustainable competitive advantage for our organization Increase the prospect of successful outcomes for our bids Gain access to a wider pool of knowledge and resource to expand BD capacity Reduce the risk to profits and reputation resulting from poor handover Improve the selling quality of our proposals

In this article we have shown some of the actions that Management can take to implement project and portfolio management best practices within their BD organization. We have also shown how, at the individual pursuit level, Capture and Proposal managers can apply some of these techniques to assure greater success for their bids.

Terms to Know* -

Acceptance Benefits Exception Gate Review Governance Management Stage Organizational Project Management

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Portfolio Management Project Approach Project Brief Project Charter Project Management Plan Project Support Office Quality Management Risk Management Scope Tolerance

Tools and Templates* Not required

See Also For more information related to this topic, see the following BOK sections: -

Bid/Proposal Plans Content Development Plans Functional and Organizational Roles Introduction to the Business Development Lifecycle Quality Management Scheduling

References* To see the information used to build this chapter, refer to: • • • • • •

BD-CMM 2.0 Project Management Body of Knowledge Revision 5, 2013 by PMI The Standard for Portfolio Management Revision 3, 2013 by PMI Organizational Project Management Maturity Model (OPM3) third edition, 2013 Implementing Organizational Project Management: A Practice Guide, 2014 Managing Successful Projects with PRINCE2, The Stationery Office, 2009.

Further Study For additional information, visit: Align Toolkit Glossary http://aligntoolkit.com/index.php?title=Glossary PMBOK® Guide and Standards http://www.pmi.org/PMBOK-Guide-and-Standards.aspx Global Best Practices (Projects) http://www.axelos.com/Project-Management-PRINCE2 Things not covered in this article: Relationship of projects (bids) to programmes (campaigns) Estimating: methods, metrics, confidence in estimates timelines and budgets

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Questions and Answers* Q1 From which organizational function is it most appropriate exercise governance over bids and offers? a) b) c) d)

Programme Management Sales and Marketing Project Management Portfolio Management

Correct answer D. See Figure 4. Q2

To which of the defined PM roles does the title Capture Manager most closely correspond? a) b) c) d)

Team Leader Project Executive Project Manager Team Member

Correct answer C. Q3 In your team organization you have described someone has holding the role of Commercial Volume Manager. In PPM terms which role most closely matches this description? a) b) c) d)

Team Leader Team Member Project Executive Subject Matter Expert

Correct answer A. Q4 Considering the following list of proposal management roles, which role is NOT a member of the Core Team? a) b) c) d)

Proposal Manager Pricing Manager Commercial Manager Technical Manager

Correct answer: B Q5

In PPM terms what type of product is a Capture Plan? a) b) c) d)

Specialist Product Technical Product Management Product It is not a product, it is a plan

Correct answer: C.

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Q6 You have created an Outline as the basis for planning the content of your proposal. What is the corresponding term for an Outline in project management? a) b) c) d)

Product Composition Product Derivation Product Breakdown Structure Product Description

Correct answer: C

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