Project & Programme Management Expert

Contractor Rate Increases – Short-Term benefits versus Long-Term gain?

2010-11-04T04:59:00.000-07:00

Having recruited within the IT + Business Change contracting sector for over 12 years, I can safely say that rate increases at the point of renewal are often a contentious and problematic issue. So I thought I’d play devil’s advocate and look at an issue that I believe is often overlooked by many contractors.

My question is: “Do many contractors consider the potential damage that requesting a rate increase could create?”

I’m not saying that asking for more money at renewal is always going to cause an issue, but I do believe that sometimes a client’s positive opinion of a contractor may reduce when they ask for a hike in their daily rate – especially if their role hasn’t changed, their responsibilities haven’t increased and their workload hasn't grown.

I can (and do) see it from both sides:

the client doesn't want to pay any more for a contractor than they currently are paying and don't like being held to ransom (in their opinion) when a contractor has become business critical,

and contractors want to ensure their rate is in line with market rates, or what they perceive to be their worth for the services they are providing (this is clearly a hard thing to measure!)

I think the problem often stems from the fact that, for whatever reason, many clients seem to take rate increase requests personally and sometimes hold it against the contractor for asking – whereas contractors see it simply as a business transaction for the provision of services and argue that negotiations like this happen across the globe in all industries.

One of my long-standing contractors (who has worked for me for over 8 years at a number of different clients) has always taken a pragmatic approach to his rate. “Rob, if my rate is a bit lower than most of my colleagues, and I don’t usually ask for increases at renewal, I’ve found that I tend to get renewed for a lot longer than most of my colleagues”. One of his contracts lasted for around four years, whereas the majority of his colleagues who were demanding 30-40% higher rates tended not to last much more than 6-12 months.

Was this due to their rate demands, or just because my contractor is better at his job than the others? Hard to say, but he’s convinced that his easy-going attitude to rates has certainly played its part and he has never been out of work for more than 2 weeks in over 10 years of contracting.

Personally, I think his success is due mostly to him being an excellent Project Manager, but I do believe that his stance around rates has helped.

I guess it depends on your own personal opinion, attitude and ultimately what drives you, as to what approach you adopt.

Many contractors are in the contracting business predominantly for the money, therefore they want to maximise their earning potential and will push their rates as high as they possibly can. If this causes ill feeling with the client, then so be it – they are here to manage and deliver a project for the client, not to make life-long friends!

Others like to work in a friendly, positive atmosphere without any ill-feeling so don’t want to push for a rate increase in the worry that the client might hold it against them.

And others (like my contractor mentioned above) take the pragmatic business approach that he will earn more money in the long-term if he is always in work at a slightly lower rate, rather than have a higher daily rate but risk not get renewed as often and being “out of contract” more often.

A lot of my recruiting is currently within the financial services sector. Having seen a lot of clients introduce rate reductions a couple of years ago due to market conditions, now the market is booming contractors are understandably fighting back!

I’m aware this can be a very contentious topic, so I look forward to a number of your thoughts and opinions – from both sides of the fence (clients and contractors)

A Project Manager's Personality – Is It Important?

2010-09-28T04:34:00.000-07:00

Having worked in recruitment for over 12 years, I’ve been responsible for recruiting many different types of candidates for a variety of market sectors, including Software Programmers, Database Architects, ITIL Consultants, Service Delivery Managers and Disaster Recovery Managers, through to Project Managers, Programme Managers, IT Directors etc.

Whilst recruiting for technical positions, finding the ‘ideal’ candidate is certainly an easier 'science'. For example, if I’m looking for a .Net Programmer with strong SQL Server skills, it’s usually fairly obvious form looking at their CV if someone has had this type of experience – the hard part is in finding out how good their technical skills are!

However, when recruiting for non-technical IT Project Managers or Business Project Managers, I’m a big believer that it’s the personal traits of the PM at interview that play a big factor on the hiring manager’s decision.

Whilst the hiring manager is obviously looking for a PM who they believe has the experience to deliver the actual project, in my experience it is often equally as important for the hiring manager to connect with the candidate. For me that means assessing their personality traits and deciding if they have the right personal characteristics to deliver the project.

Whilst a lot of people like to think they can adapt their approach to most situations (and many can, to a point), I honestly believe that some PM’s personalities will be better suited to certain roles, and astute hiring managers will also be looking for these whilst interviewing.

I'll give you an example of two roles I have recently been asked to fill:

The first role is for a PM who will have to manage some very tough and demanding negotiations with a third party supplier. This is likely to require a different type of PM to the second role, where the biggest problem they will face is the project team, who have been falling out and failing to work well together.

The first role is likely to require a stronger personality, someone who is comfortable standing up to bullish supplier and can develop a good working relationship with them further down the line - once the supplier has understood that they aren’t going to get everything their own way!

The second role is possibly looking for a PM who has better 'soft skills. Someone who has good people skills and is capable of encouraging the team to discuss their issues and work together and create a positive working environment - ultimately getting the project back on track.

So my role as a recruiter is not only to identify who the good Project Managers are, but also to understand what type of personality traits the hiring manager is looking for and that best fit with the job in hand. This is one of the hardest parts of my job, and in my opinion the best way to get a good understanding of a candidate’s personality is to meet them face to face.

Unfortunately, this isn’t always possible (due to location and time constraints) but I do my best to meet as many of my core contractors as possible and it’s certainly paid dividends to both myself and the candidates – the ratio of people I’ve met and who I’ve placed in a contract is massively higher than those who I haven’t met. The problem I have is that I have to be fairly selective in who I meet, otherwise I’d never get any other work done!!

I’d be keen to hear your thoughts, especially from hiring managers – is this something that you consciously (or possibly unconsciously) look for whilst interviewing?

Where have all the Financial Services Project Managers gone?

2010-06-08T07:22:00.000-07:00

The vast majority of my time and effort is currently fulfilled within the financial services PM area. The market is booming. It seems like every insurance organisation, banking group and Life + Pensions establishment are competing against each other for contract Project Management resources. The race is on to get the best people and from personal experience I can categorically confirm that there aren’t that many through-and-through financial services PMs sitting at home with their phones remaining silent.

To quote one of my contract Programme Managers yesterday, “My phone is so red hot from receiving vast amounts of calls at the moment, I’m going to have to consider changing my number. I’ve never, ever known activity like this” – and this coming from a highly experienced Life + Pensions / Banking Programme Manager who’s been contracting in the UK for over 15 years!

His contract is currently up for renewal, and the number of potential options he has on offer is frightening. If the market carries on like this, surely the simple economic model of supply and demand can only lead to one outcome – rates are going to go up, and substantially!

But even if rates do go up, the simple fact that there is a genuine shortage of good quality financial services PMs is going to cause considerable pain for a number of large institutions.

So why is there such high demand?

There are a variety of major Financial Services Authority (FSA) led regulations that have caused a large increase in business PM requirements, such as Liquidity Reporting, Solvency II etc. And there are also some major integration / merger programmes currently underway that are utilising even more resource – e.g. the Lloyds / HBoS integration, the Co-Op / Britannia integration and the Nationwide Building Society’s attempts for UK domination of the Building Society market!

I'm lucky enough to have been heavily involved with both the Lloyds Integration programme across the UK and Nationwide’s take-over of a number of other UK Building Societies, and between the two of them they have swallowed up a large amount of the PM resource across the UK, with the demands still ongoing.

Good candidates are key

Over the 12 years or so I’ve spent in IT + Business Change recruitment, traditionally I’ve always been most excited when I receive a new vacancy from a client. However, in the current market I’m much more inclined to think that my commission is going to go up when I find a good candidate! If that PM will work for sensible rates (!) then I’ll be very confident that I’ll be able to find them a job. All I need next is for them to refer a colleague of theirs to me, so I can find them a job as well!!

To me, this is the best way to identify new candidates – after all, most people will only refer someone to me who they rate highly, otherwise it would reflect badly on them. So in short, there’s loads of financial services PM roles across the UK, there’s not many candidates available, the demand doesn’t look like reducing, the rates look like rising, and if you know anyone who’s looking for work, please please please pass them my details!!!

The Future?

I’m not sure what’s going to happen when all these programmes start winding up and all these contractors suddenly start looking for work, but I guess we’ll worry about that when / if that happens – hopefully not for a long time yet!!

Want to double your rate? Get some Solvency 2 experience...

2010-04-06T08:51:00.001-07:00

For those of you that aren’t involved within the financial services / insurance sectors, you probably haven’t heard of Solvency II. For those who do work in insurance or an associated industry, then you must have been living in Timbuktu not to have heard of it!

Every few years or so, a new financial services regulation / initiative seems to appear that sets clients and recruiters alike into a frenzy of excitement or fear. Much like Basel II, WRAP, MiFID (Markets in Financial Instruments Directive), A Day, Sarbanes Oxley and TCF (Treating Customers Fairly), Solvency II is the latest directive that is sending the Insurance world into a spin.

The official description from the FSA is:

“Solvency 2 is a fundamental review of the capital adequacy regime for the European insurance industry. It aims to establish a revised set of EU-wide capital requirements and risk management standards that will replace the current Solvency 1 requirements. Solvency 2 will set out new, strengthened EU-wide requirements on capital adequacy and risk management for insurers with a view to reducing the likelihood of an insurer failing; the strengthened regime should reduce the possibility of consumer loss or market disruption in insurance.”

Or in simple terms, Solvency II is trying to stop what happened to Northern Rock (and other similar Banks) from occurring in the Insurance industry. It’s a major EU Directive and all EU based insurers are going to have to comply.

So, how does this affect you and I, the Project Management professionals?

Well, in the last 3 – 6 months I’ve recieved more and more Solvency II based PM roles. As this directive is still in it’s infancy it hasn’t been easy, in some cases impossible, to find candidates who have genuinely worked on or managed Solvency II projects - but all my clients are still asking for proven Solvency II experience. It’s the age-old chicken and egg scenario – how do you get SII experience if clients will only consider candidates who already have it?

If I’m honest…….luck, mostly. Right place, right time. You can read up on it all you like, but unless you’ve actually got commercial experience it’s unlikely you will get your foot through the door.

Unless………you’ve worked with Actuaries

The most common and re-occurring background that seems to be desirable within Solvency II programmes is someone who has worked on projects with Actuaries or within Actuarial Departments. A major part of all Solvency II Programmes involves close contact with Actuaries, and most of our clients believe that you need a different approach / set of skills when managing them as stakeholders, getting information from them and gathering requirements from them.

I’ve spoken to a few PMs in the last couple of months who have managed to secure a SII PM interview due to their previous experience of working with Actuaries. You obviously still need to be a good PM and demonstrate your excellent PM skills at interview, but it’s often been the Actuarial knowledge that has allowed them to wedge the door open and get in front of that elusive Solvency II Hiring Manager!

Going, Going, Gone!

The other trend I’ve seen happening this year has been PMs who’ve gained around 3 months or so experience on a SII project, then starting to actively look to sell their skills to a higher bidder – and who can blame them!

If you’ve taken the practical approach over the last year or so and been flexible on your rate (!), then why shouldn’t you take advantage to get you rate back up (and probably above) to what it was in a busier market – and Solvency II skills seem to be extremely lucrative in the current market. I’ve seen good PMs go from £400pd to £700pd, based almost solely on having worked on a SII programme for just 3 months.

Personally, I’ve had 3 separate offers of 12 month contracts turned down by SII PMs who’ve gone to another client paying more money, based closer to home, more flexible on location etc – it’s rare in this industry to have a 12 month contract at £700pd rejected, but it just goes to show how in-demand these PMs are, and the choices they have at their disposal.

In fact, it’s often the smaller insurers who are paying the higher daily rates (£650pd+) for SII people – I guess they appreciate how important it is to get this Solvency II stuff right, and are doing what they can to get the right people.

So in conclusion, if you can get involved in a Solvency II Programme then do so, immediately, then send your CV to me…………

Who is the Best Project Manager?

2010-03-01T08:28:00.000-08:00

Following on from my last blog “Which Project Manager Do I Hire?” I thought I’d give a couple of examples of what can (and often does) happen when hiring managers only hire PMs who have managed similar projects or worked within a rival organisation, rather than choose the best “Project Manager”.

My question:

They might have managed exactly the same project for a different company, but is this a guarantee that this person is actually a good project manager who will deliver the project within time, scope and budget?

Scenario 1:

A PM who has the relevant experience / knowledge, but who isn’t necessarily a good Project Manager.

This person understands all the detail and subject matter and is able to quickly get up and running, however they make all the same mistakes that they made in their last project (that was delivered late and over budget). They can’t keep track of the costs effectively, they can’t manage / motivate their team to ensure that crucial timescales are met, they don’t know how to make (yet alone follow) a good project plan, they have poor stakeholder management skills. So the project is in turmoil, the project sponsor is unhappy. This PM has managed a similar project before and has good knowledge of the subject matter but they can’t actually manage a project effectively, or ensure that it gets delivered as and when the sponsor requires it to be.

Scenario 2:

A proven delivery focused PM who hasn’t got the relevant knowledge of the technologies / project details.

This PM has a steeper learning curve, trying to understand the technologies and project details, and will take more time getting up-to-speed with the project. This isn’t ideal, however this PM has been here many times, and is quickly able to get an understanding of the detail of the project by establishing good relationships with his technical staff / subject matter experts and utilising their knowledge.

As soon as they are up-to-speed with the detail, this PM quickly establishes control of the project, following the usual steps they use to ensure that the project runs smoothly, keeping costs on-track, appeasing stakeholders, managing expectations and managing risks and other issues. This PM uses his technical experts as trusted advisors and doesn’t get bogged down with the detail, meaning the PM has more time to spend actually managing the project, which in turn ensures the project has a much better chance of being delivered on-time and within budget.

Clearly, I think all hiring managers / project sponsors would prefer the outcome in the 2nd scenario, so why is it so often the case that they plump for scenario 1?

Which Project Manager do I hire?

2010-01-29T07:54:00.000-08:00

1. The best project manager?

or

2. The project manager who has managed the most suitable or similar projects?

It’s a dilemma that I hear nearly every day, and an issue that has been around long before the latest financial crisis.

So, who should you interview?

I can see the problem that hiring managers face – it’s impossible to grasp enough information solely from a cv to figure out who is a good PM and who isn’t! It’s easy to state in your cv that a project was a success, delivered on-time and to scope – however, the reality is that this is often not the case.

So often hiring manager go by the projects and companies a candidate has worked on/at to decide which ones to interview, all too often resulting in a short-list of the ones who have managed similar projects but not necessarily the best project managers. This is why so many PMs get frustrated at being overlooked for roles that they are convinced they could execute, with ease.

And how do I make sure the PMs who can really deliver get the interviews?

With 11 years recruitment experience, and having specialised in recruiting for Project and Programme Managers for over 5 years, I have a good idea who the best PMs on my books are – this is gained from years of dealing with contractors, receiving numerous recommendations from other trusted PMs, referrals, peer to peer references and having close contact with PMs who have contracted for me on several occasions.

The simplest solution I can suggest is that the hiring manager trusts me (and my experience) and interviews the candidates that I recommend. This is ultimately my job, my speciality, the area where I am an expert. I have many clients who trust my judgement - we’ve worked together long enough for me to know what they require. And, in the vast majority of cases, a PM that I recommend gets the job and in turn delivers the project.

The Problem
The problem, however, is when I do not have the trusted relationship or even contact with the hiring manager – which is unfortunately too often in this HR / PSL driven market, where recruiters like myself are not allowed to speak to the people making the decisions. Unless the hiring manager is able to listen to my recommendations, then we are back to square one, and all the frustrations that I have discussed in this blog.

Any Suggestions?
I’m obviously keen for some fresh ideas / approaches / solutions around this problem, and would welcome the thoughts of not just contractors, but of the hiring managers at these type of organisations who must also suffer similar frustrations from the other side of the fence.

Which skills and attributes make the best Project Manager?

2010-01-14T04:27:00.000-08:00

Common sense would suggest that it’s the person who can manage a project in the best manner, achieving the best results, delivering on time, within budget and to the agreed scope. After all, this is the main purpose of a PM, and the reason why so many companies pay high daily rates to Project Managers, to ensure that their projects get delivered.

So, why then do I find myself having the same conversation time and time again with a variety of highly experienced Project Manager’s, who repeatedly tell me that it doesn’t matter what technologies the project is using, or what FSA regulations the project has to adhere to - as a Project Manager you manage the project. You don’t get bogged down with technical IT issues or in the nitty gritty of the latest FSA regulations. You have technical specialists who do this for you or Subject Matter Experts who advise you on the detail so you can keep the project on track and utilise their expertise as and when necessary.

I appreciate that in certain circumstances this will be different – in a smaller organisation or a smaller project with limited resources / budgets there will have to be compromises, but I’m typically discussing the types of projects that are being run within large FTSE 100 type organisations where PMs are assigned as pure PMs – not technical PMs who are having to effectively do three jobs in one!

In my opinion if a PM is getting too close to the detail and technologies within a project then they are unlikely to be spending enough of their precious (and expensive) time actually managing the project, which is ultimately what they are being paid to do.

Your Views?

Next Blog: How do you make sure you are interviewing the right PM for the job?