This article is part of a theme consisting of a few articles on project management professional training.
Introduction
In recent articles, and in our eBook: Project Management I: Challenges, Opportunities, Methodology, we discussed that project management is at a crossroad due to damages coming from overzealous professional associations, training providers, and individuals. Project management training is one of the areas where the damage is significant and is directly contributing to more damage to the field of project management professional practice.
The various articles under this theme will highlight many cases and from different angles. In this article we present a case study.
Case Study
One of our clients has been working with us for about 4 years. We provide them with project management training.
Every few months, they give us a contract to train a group of people, usually short engagements; 3 to 10 days. The feedback from the participants and the client’s representative have been great and they are highly satisfied with our service.
Last year, they come to us, recognizing that project management skills are highly important and wanted to have a long term contract to lead learning programs for a large number of team members. Obviously, they came to us since they trusted us and we have always received high praise from them and their employees who attended our workshops. My colleague Luc Bauwmans, has been the SUKAD Principal Consultant leading these sessions.
One problem!
Because this time the client wanted a multi – years contract and for multiple groups, procurement became involved and refused the single source approach, and would not issue the contract. They stopped the single source approach and asked for bids. Obviously, we were on the bid slate, among many other local providers.
A few weeks later they came back telling us we lost the contract because the other providers are half of our price. Learning and development could not support or justify such a difference. We asked them – for their benefit – not to issue a contract yet. We shared with them our thoughts on the “training business” and the quality of some of the providers. We also gave them a list of things they should look for when selecting a providers; which we published with our last post.
The client came back a few days later, appreciating our feedback, and telling us we were right. They never gave details but apparently rejected the other offers. However, Procurement were still not comfortable and they decided to use our guidelines and open the bidding to other organizations that they would consider would be peers to SUKAD, including internationally.
One more cycle, the bids came, and sure enough, our prices were in line with others (no details provided) except one qualified company was lower than us. We were not not sure the magnitude of the difference. If we did not have an excellent history with this client, this would have been an easy case – our competitor would have won a multi-years contract to deliver training to a large number of professionals. Yet, because of our history with the client, the client representative was able to convince procurement to do something different.
The client decided to have the other company deliver one program for one group, and SUKAD do the same for another group, with the client representatives and procurement monitoring. In this case, the client only committed 2 small contracts instead of the major one – the better performer will get the full contract.
We are happy to say – we signed the contract!
Closing Remarks
The message, and core lesson from this situation, is that the customer must be first, second and always. We must also understand that customer might not be fully aware of what is available. If we had not worked with the customers and try to raise their awareness about the project management training “business” they could have gone with a low cost provider that might not be qualified, even if they are recognized by a professional association. Even with the second bidding, the client trusted in us to question the alternative.
For SUKAD, by giving the client guidelines on how to select a project management training providers, we were risking the contract but that was an acceptable risk to us; since our focus is the client. If an alternate is better than us – that means an opportunity to learn on how to improve.
Luc Bauwmans Leading a Workshop
At the end – what some clients do not recognize is that the significant cost of a training program is not what they pay the provider; it is the cost of 10, 15, or 20 professionals in a class – that might not meet its business objectives.
This is a true case of win-win-win! SUKAD won, the client won, and their employees are enjoying the classes with Luc!
Something to consider……
When you are going in for open heart surgery, do you look on Ebay to see who is offering a “special deal” on cardiac surgery?
I find two things incredible about training (or any other professional service)- 1) That anyone would even consider basing the selection on a competetive “low bid” basis. (“You pay peanuts, you get monkeys”) and 2) That sophisticated successful global companies are still looking at training as an EXPENSE and not an INVESTMENT, from which they should expect a favorable return.
A third trend which seems to be gaining traction is the growing distrust of exam based credentials over those which require competency assessment.
But clearly the “best” companies are still in business and more and more people are starting to question the value of ANY short term training unless it is part of an integrated program which achieves at least Kirkpatrick Level 3 http://www.kirkpatrickpartners.com/OurPhilosophy/TheKirkpatrickModel/tabid/302/Default.aspx IF a company cannot measure or assess the value of the training their provider offers, then all they are doing is flushing money down the toilet…..
BR,
Dr. PDG, Jakarta, Indonesia
http://www.build-project-management-competency.com
Dr Paul
Oh brother how frustrating it is sometimes … enough to consider getting out of the domain. It is amazing how many leading organizations think the way you describe!
This comment is By Abdulhamid Alsaady on LinkedIn:
Mounir,
Thank you for sharing this case with us, we always learn from your great experience.
But, with all due respect, I see another dangerous case study here. It is “How to use your sales team’s connections to influence procurement decisions”, and god forbids, it can fall in illegal ;or at least ,unethical actions considering the standard bidding regulations, acts or common competition norms and values.
I am not one of your competitors at all, but I assume companies should have responded to the RFP/FRQ as it was written .And if it was not well written, then it is not fare to borrow the details from one bidder only..
As a person who established the procurement procedures in different organization, I always emphasize on the following relevant rules:
Rule#1: Don’t let any potential vendor writes your RFP.
Rule#2: Give sufficient details in your RFP, don’t let your personal preferences influence your employer procurement decisions.
I should not discuss further the case from “procurement” point of view, but I saw a red flag when you were able to influence the decision and to win a contract.
Hello Abdulhamid
Thank you for your comment and feedback. I agree with you on most of what you said but need to clarify a few things.
A few times in the past – clients sent us a brief email RFP – we respond with detailed proposals – only to find out that the client used our proposal (modified) as a new RFP and sent out to other organizations. This happened to us at least 3 times – and we lost 2 out of the 3 because the client went purely on price.
Now the issue with price – let us take a PMP course as an example. In Dubai – you will find companies that offer a PMP course for $500, another for $4500 and a few in between. Supposedly the same course that is based on the same standard. But is it the same course? On the low end – you find someone who copy pasted the PMBOK and is teaching the class and on the high end it might be one of those global company with good course but they are selling their brand – name. In the middle you could find great companies – or lousy companies.
To avoid the above situation, we published some guidelines on our website – available for all to see – clients, competition … etc. Of course those guidelines are based on our opinion but any smart client can read them, understand them, and decide whether to use them or not. Those guidelines do not bias anyone and you can review and judge yourself.
Finally, in regard to this case study – i cannot mention the client or the specific info but i can tell you this situation was for specific courses that are global — standard topics … so manipulating procurement was not possible and as you could see – it came down to actually short listing to 2 companies and monitor their actual performance.
Hello, The experience here is not really about Project Management training, rather it is about the strategic management of project management training, an issue I address in my Triumph ViP Colloquium.
You cannot bid on price alone, there has to be something else. Too often the lowest bid is accepted, a phenomena, but “you get what you pay for”. And that includes project deliquency, conflict, litigation, delays, damaged reputations.
The missing ingrediant here is Stakeholder Engagement, which then must be aligned with PM, a topic I devote a whole TViP Session too. You can think of the “something else” as “value for money” a rather ambiguous term I know.
Instead your Clients decision maker was trodding a well worn pathway to project deliquency. As Professor Flybjerg famously stated in his equation: over estimate the benefits + underestimate the costs = contract award. Are they really so foolish they do not recognize this?
Seems to me they were subconscioiusly practising this. Their corporate culture says they must.
This too introduces a whole lot of issues iutside the realm of ‘pure’ project management and its 9 Core Competencies per se, but necessary for project success. Hence my TViP Colloquium.
So what will be evident is that it is not just the Project Managers that need training but the Board Executives as well. Do they recognize this? (Seems they do not!) After all it is what they are paid for! I can visualize a Board Meeting!
We so often hear about project failure being down to “poor project planning”, whatever that means. This brings in another plethora of topics. One can deduce challenging the Corporate culture, which again brings in lots of topics.
Thank you and Kind Regards, Brian
Thanks Brian – appreciate you and your contribution. It is quite valuable.
Sorry about the typos, but you will get the idea. There are all sorts of questions buzzing around in my mind!
this comment is By JOSE RICO on LinkedIn
A few days ago I clicked a “like” to this picture advice: “We offer three kinas of service:
GOOD – CHEAP – FAST. You can pick any two. GOOD service CHEAP won’t be FAST. GOOD service FAST won’t be CHEAP. FAST service CHEAP won’t be GOOD.”
But Mounir linked article, highlight something else, that’s its TRUST. Client usually think on FAST Profits or maybe high satisfaction, but always thinking of any “TWO picked” is a no written rule.
The referred article makes a clear statement: CLIENT trust is an ASSET that always is cleaver for Project Management.
Thanks.