A Project Services Business, or PSB, generates the majority of its revenue through delivering projects as a service.
If the majority of the work your firm does is made up of discrete projects – you can think of your firm as a project services business (as opposed to say a manufacturing plant that has a continuous line).
Here’s just a few things that may differ …
If you’re in the project business then generally, you win work on a project-by-project basis. It may mean there’s lots of bidding or tenders involved. It may also provide the opportunity for frameworks – where you prequalify for future project work with a customer or group of customers (governments use frameworks a lot).
So you may need to position yourself differently as a PBB and you’ll need to fully understand and manage your opportunity pipeline or funnel. How you set up, train and incentivise your sales and marketing team might need to be different too.
Start up and handovers can be special opportunities for project businesses. These moments (and others) are key to set yourself up for repeat business.
How you track and improve your win success rates will be key too, as will knowing when to ‘No Bid’ opportunities.
There’s a lot of work involved for PSBs to face up to the market and win work.
It’s more likely that in providing a solution to a customer as a project – each customer will ask for something, at least slightly, different.
It’s crucial then to find ways to use common processes or platforms that are relevant to, and can underlie all of your projects, whenever you can.
This percentage mix of ‘platform to bespoke content’ can mean the difference between success or not. Learning from ‘Software as a Service’ and other good practices from service plays and pulling what you can into your operations is worthwhile.
Then there’s the added complication of running numerous projects simultaneously and how to smooth the work to help your business whilst hitting each individual project’s milestones. There’s a whole sub-specialism in PSBs for Portfolio Management – how to optimise the portfolio of projects your business is undertaking in order to meet your strategic and financial needs.
Project milestones (and payment milestones) don’t fall neatly into financial quarters or years either. Having best in class ways to deal with that – knowing when you can recognise revenue – and forecasting when you’ll receive cash – is important.
Plus, how you transfer knowledge and experience from one project to the next takes a system.
You’ll lose money and reputation if you repeat mistakes.
If you’re an owner, director, manager or leader in a project based business, then finding, developing, allocating and retaining your people can all take different approaches than if you were in other types of business.
Planning a career path for people who work from project to project takes thought and how you explain that can be key to attracting and keeping people.
Then, it’s a real commercial advantage to get your project teams right.
Getting the right mix of experience and skills into your project teams and being smooth at transferring people in and out as required, whilst maintaining momentum, is a challenge when projects are temporary in nature.
How you allocate your people to projects and how you improve your utilisation rates is tricky when you have lots of spinning project plates.
Running and controlling project based businesses is different.
Decisions are made on a project by project basis which means finances and risks happen per project too.
Lots of firms look to encourage decision making at a level close to the customer – but that responsiveness and agility requires training, control, monitoring and adjustment.
Aggregating that up at increasingly higher levels in your business takes appropriate processes, systems and authority levels. Not to mention a portfolio approach to both finance and risk management.
Managing the financial ‘S-Curve’ (forecast spend versus actual spend) and the Risk Register – at the aggregated level requires special attention. Having effective gateways, with the right personnel, given the right authority and using the right data, enables the best chances of making good decisions at every level.
‘Earned Value Management’ (EVM) practices and software that integrates with your enterprise-wide, Business Intelligence (BI), can be really useful.
Some of your controlling metrics are likely to be different in a project based organisation.
Because of all the considerations above, it often takes different processes, systems or tech to run a project based business rather than a non-project based business.
Knowing what’s out there for you to use can help turn your project based business from operating in the red to operating in the black – or to improve margins right across your workload.
Below is a list of just 25 types of Project Based Business.
The list is here because I’ve found over the years that people often stay within their type of project business. They mostly don’t move from type to type.
However … here’s the interesting thing … you can really learn a lot from other types of Project Business.
PSBs in other areas often hold a key to making substantial differences to your own organisation.
So the list below is there to help you think about other types of PSB that you could reach out to, or learn from.
Here’s a list of just 25 types to get you started …
… and so on.
There are genuine golden nuggets to be found in other types of PSB. Because each industry has its own history and challenges – each is often strong in different aspects of being a PSB.
Reaching out to someone new can be a real help and if you don’t know of good people in other PSBs – drop me a note and I can hook you up.
