Belinda Stening recently caught up with him to discuss the nuts and bolts of project management. Here he offers his detailed insights on everything from the importance of well-honed communication skills to the best ways to avoid budget blow-outs.
What are the biggest challenges when it comes to project-managing product development?
There are four types of risk facing any new product development (NPD) project: technical risks, commercial risks, business risks and ‘act of god’ risks.
There is always technical risk with NPD, as you are breaking new ground. You strive to be better, faster and cheaper and to beat the competition and the clock. Most of the time you start a project with some key inputs unresolved.
Great examples include the original iPod, with its unacceptable battery life, and the Boeing 747, which was designed around an engine that did not exist at the time.
Closer to home, this takes the form of designing around a PCB that is not finished (and usually grows extra components at the last moment), or the assumption that a particular mechanism can be made to work within specific space constraints.
Commercial risks are everything to do with the product that is not technical. This includes market risk (the competition is about to release a radically new product or drop the price of an existing one), supply-chain issues, legislative issues, and so on. It could mean that you are not meeting cost targets with tooling, components or assembly because of exchange-rate fluctuations.
Project-related risk includes anything from timely availability of resources, to delayed third-party input, to intellectual-property (IP) novelty and infringement issues.
Business risks relate to the client and how their overall business impacts the project – for example, changes in ownership, share-price fluctuations and mergers and acquisitions.
‘Act of god’ risks encompass the events that nobody foresees or that are deemed so unlikely they are not worth taking into consideration. A friend of mine produced a great movie for three years, all funded, great actors, great script; everything perfect. Release date: September 11, 2001. It never saw the light of day.
One of our clients gave a six-figure cheque to their patent attorney for the final round of applications, after lengthy development (and all due diligence completed). Two days after the cheque cleared, a multinational company released a virtually identical product (not as good but commensurately cheaper). Their patents predated our client’s by a few days. Bad luck, our client was out of business.
Good communication with a client is the foundation of a strong working relationship. How is this best managed?
There are several levels of client-designer communication. The formal one deals with things like contracts, orders and terms. Then there is the project-management side of things, including formal communications (Gantt charts and PERTs) and informal, day-to-day interactions.
Formal communications between the client and the design team start with the brief, which is written by the client and outlines their requirements and constraints. This is answered by the designer’s proposal, which reiterates the brief, and adds outcomes, time lines and fees.
The proposal, coupled with the designer’s terms of engagement form the basis of the on-going engagement. Another issue in the design industry is that every single firm has its own set of terms. While the terms deal with all the legal boilerplate, the most important aspects for the designer are IP, indemnities and warranties.
All design firms deal with those differently, giving the client an unfair advantage. My dream is for all designers to use a standard set of terms and fees, where everyone can fill out their own dollar amount, but the conditions and terms are the same.
Other formal communication includes the management of orders, invoices, financial statements and IP assignments. Especially in the current economic climate, it is important to manage cashflow properly.
Formal project-management methodologies, range from waterfall models to agile development and Scrum. Any reasonably experienced design firm will have established systems in place.
Some clients insist the designer uses a methodology compatible with their own systems, but it’s generally a good idea to minimise the amount of direct interference by a client into the inner workings of a consultancy.
Clients hate surprises. There is a fine line between keeping them ‘in the loop’ and bothering them with unnecessary detail. They hire you to take care of problems, not to create more.
Good design managers carefully manage the client’s expectations. Great design managers are the ones who can truly understand what a client wants and needs. They adjust the way they communicate to fall in lockstep with the client. Client hates emails? Use the phone, or drop in and see them in person.
Some clients love to hear about every little detail; others only want to know when they can come in for a presentation. It matters less what the design manager wants, although many clients are happy to be shown better ways of communicating.
The designer or design manager also has a responsibility on to ensure that they understand the client, and that the client understands them.
Many terms are used interchangeably and mean different things to different people. For example, ‘lash-up’, ‘mock-up’, ‘model’, ‘presentation model’, ‘working model’, ‘functional mock-up’ and ‘prototype’ – these all mean different things to different people. There are many subtle and quite slippery concepts that have to be nailed down.
Common sense, respect, timeliness, humour, and honesty tempered with tact and humility are the cornerstones of a great communicator.
Which methods of communication work best?
Regular communication is the key. Reg-ular informal contact makes formal contact a mere formality. Simple proced-ures like “just keeping in touch and letting you know how it’s going” emails or phone calls are a great way of keeping clients informed, even if those emails tell the client that nothing much has happened (due to external circumstances, of course).
One of the benefits of formal communication such as presentations is that it usually forces all parties to get their house in order and tidy up any loose ends.
Email has become the default method of communication because it is quickly and easily disseminated to a number of people; reports, images and 3D files are easily included; and it provides a historical record.
Problems with email are also numerous: who hasn’t sent an email to the wrong recipient? There is no single best way to capture email conversations long-term and searching through crowded inboxes is time-consuming and often futile.
There are other high-tech methods of communication using the internet such as web-cams, wikis, FTP sites, virtual whiteboards, virtual offices and online project-management tools. With the advent of Web 2.0 there has been a vast proliferation of collaboration tools.
Different methods of communication are suited to different tasks. Well-run meetings are the greatest way to get a group of people singing off the same songsheet – too bad not many meetings are well run. A good meeting requires planning and preparation, and a well-informed and assertive chair.
Many people call meetings out of an intellectual laziness (“just come in for a meeting and we can mull it over”), to which the best reply is either “let’s mull it over now” or “okay, send me through the agenda”. That may be cheeky, but it does tend to focus people. Nine out of ten meeting requests can usually be taken care of by phone or email.
Meetings are also great when big conceptual decisions have to be made about a particular direction, as input and feedback is immediately available. A well-run meeting allows healthy debate. It allows people to see each other’s points of view.
The worst thing that can happen to a client is to be ‘left out in the cold’. Where the designer does not communicate, or communicates unwillingly. The danger for the client is that the project either makes no progress, or moves in the wrong direction. Conversely, designers have to make sure that they have the ear of the client.
Good communication on other levels is also vital – be it internal, within the design team, with the clients’ team and with suppliers. How is this best managed?
Intra-office communication has to be based on protocols, including directory- and file-naming conventions, revision management, naming policies and the sharing of a common vocabulary. Shared calendars, regular informal and formal progress meetings, and keeping the design team to the smallest size are all great ways of ensuring projects stay on track.
There is conflict between the creative mind and such structures (hey, we’re not engineers or accountants), but once such systems demonstrate their value, people are quick to embrace them. In my experience people miss great structures once they are gone.
Regular subcontractors and suppliers are a great asset, as they don’t have to be taught how to get ‘up to speed’ on how the design office works. Many of the bugs have been ironed out of the relationship and each side has a good understanding of the other sides’ capabilities and expectations.
New suppliers and subcontractors must be briefed properly. This works on two levels. On one level it’s about the project’s immediate requirements; the other is “this is how we work and this is how to work with us”. A single-page write-up on the way things are done in your work environment goes a long way to making subcontractors’ lives easier. This covers file formats, naming conventions, revision management, file transfer details and so on.
Of course it’s also vital to set clear guidelines and expectations, from performance criteria to deadlines, scope and deliverables. The regular “how are you going?” email or phone call can work wonders at unearthing miscommunication or problems.
Where and when can poor communication let the project-management process down?
Poor communication, which can be as simple as people not returning phone calls, lets everyone and everything down! Sleepless nights and blown budgets tend to follow if people have a diverging understanding of outcomes, time lines, budgets and expectations.
Language skills are also extremely important, especially when dealing with outside experts like engineers and patent attorneys. One of the greatest in-house communication skills an industrial designer can have is the ability to sketch quickly!
What techniques can be used to manage communication, so that everyone understands what is going on?
It’s important to have an agreed protocol that takes care of rule-based issues and covers contact details and responsibilities.
A ‘definitions’ document that spells out unambiguously what words and terms mean may sound retentive but it can save a lot of heartache.
Make sure you spell out who is responsible for what. Who is the primary client contact? Who is in charge of revision control? Who is in charge of the electronic package?
Regular team updates, be they group or ‘round-robin’ emails, or telephone conferences where everyone gives their status are essential.
It’s important to adopt a project-management methodology that works for your business and your client. Some clients hoist systems on designers; other clients are extremely disorganised.
What is the best way to delegate tasks on a project?
The best way to delegate tasks is to identify the ones that are able to be delegated. Tasks with clearly defined inputs, outputs, deadlines and budgets are ideal for delegating. Tasks that require core decision-making or executive oversight are generally not suitable for delegation.
Find the right person to delegate the task to. Follow up regularly, check their assumptions, and ask them to give you a reverse brief (“I understand you want me to…”).
Taking into account that all projects are different and have their own unique set of requirements, and problems/opportunities, how do you manage personality clashes and match staff to specific tasks?
The best way to avoid personality conflicts is to load people up with more work than they can handle. That leaves little time for personality issues.
There will always be people who are perfectly okay in their own right but who react badly when put together. The good design manager is on the lookout for that and will try to assign tasks and responsibilities accordingly. The truly great design manager will hire people who don’t clash at a fundamental level.
NPD projects generally run to tight deadlines, involving lots of stress and long working hours. It’s good to work with people who can cope with each other in that environment for long periods of time.
When there is a personality clash between a design principal and the client, this can become a tricky issue. The designer must always be professional and not lower their standard if the other party slips; conversely, a designer has the right to expect professional standards from their client.
In larger firms, people can be rotated into and out of positions to ensure a decent personality match. Long-term personality issues, if left to fester can seriously undermine projects. There is an old saying in HR circles: “The only way to change people is to change people”.
There are project-management consultants who can project-manage for businesses. What are the advantages and disadvantages of using consultants?
Many NPD projects are run by consultants contracted to the client’s company. The big issues are: has the consultant got the appropriate authority (explicit and implicit) within the client firm; is the consultant suitably briefed up by the client to be an effective project manager; and does he/she know the client’s company and culture well enough?
Designers become part of the politics of larger companies and have to be adept at operating in that environment. They have to find out what the official and the behind-the-scenes motivations and agendas are.
Keeping the client up-to-speed on project matters is an important tactic for avoiding the ‘blame the designer’ game. Unfortunately, the designer takes a great share of the technical risk.
One of the advantages of working with a client’s project manager is that a good one can cut across political dividing lines in the client’s company and become a champion for the designer. They can be a great source of information and know-how. They may also lead to further assignments when they move to a different firm.
Making sure milestones are met, stages are completed on time, and results are delivered can be a big challenge. What is the best way to time-manage projects?
“How does a project run a year over schedule? One day at the time.” This saying correctly identifies the little things that are harmless on their own (what’s one day!) but that add up to steal vast amounts of time.
The role of the design manager is to keep the troops marching in the same direction and to identify when work is starting to move off course. This can mean ruthlessly saying “no” to lots of great ideas and will also involve negotiating changes to deliverables (outcomes) and deadlines with clients.
An experienced designer or design manager will have a good idea of how long a specific piece of work will take. Young designers have a tendency to over-design, to get things ‘perfect’. Often the requirement is not perfection but fitness for purpose.
Work has to be continually re-prioritised and kept on track, and a wise design manager will always allow for float or over-run when quoting time lines. The problem is that usually the deadline is decided before the brief is issued, which makes proposal writing a skilful application of resource allocation and compromise.
How can you negotiate for more time?
Most clients are reasonable people. If they have been kept informed, and progress has been satisfactory, a realistic request for a revised deadline will not be refused.
However, clients are sometimes subject to external deadlines like tradeshows or board meetings. Then it becomes a matter of cutting features to meet the deadline. A good design brief will help the designer couch the change properly. This is best done in close consultation with the client, as their priorities change constantly as well.
Are there incentive schemes that clients can implement to encourage designers to deliver before deadline or on time?
Cash works well! A client can do anything from offering faster terms of payment to the promise of a more realistic deadline for the next stage. In some industries, suppliers get bonuses (or conversely are penalised) for not missing deadlines. This may be negotiated individually with the client. Personally, I prefer a bonus system over a penalty system!
The budget for a project is usually set by the client, in consultation with the designer. How can designers make sure that budgets are realistic and achievable from the beginning?
If the designer is involved in the initial setting of the brief – which is rare, as clients usually write a brief and set a budget and then go out and seek proposals – then examples of prior work and budgets can help demonstrate what can be achieved.
Usually a client has already determined a budget, and then it is up to the designer to accommodate the client’s requests. Unrealistic budgets must be dealt with quickly.
I always love it when clients say “we have no money for this”. Do they go to the supermarket with empty pockets?
It is important to know the client’s motivation and background. Is this their first design project, or have they had a bad experience before? If so, it could be appropriate to start in small stages to give them greater control and reduce their risk and exposure, rather than commit to a big budget upfront.
Examples of previous projects with rough indications of costs versus deliverables can be a good way to negotiate realistic budgets. There is a big difference between clients who are experienced, and the ones who are doing NPD for the first time.
Spending time with the clients and finding out what they require will help set realistic budgets and expectations. Some clients use this free consultation time to ‘pick the brains’ of the designer, spending lots of time with them without any intention of going ahead with a job.
How can you negotiate for more funds during a project?
If there is a solid track record of achieving milestones and deliverables, the client should be open to negotiations. Many times the target specification and deliverables and deadlines will be changed by the client in the course of a project.
Any time the scope of a project is expanded, the designer has a legitimate cause to argue for a change in fees. If this is done in a spirit of openness and goodwill and the issues are clearly spelt out to the client, there should not be a great problem.
What sort of payment arrangements (eg, payments per project phase/stage, payments before proceeding to next phase) do you recommend?
All designers should ask for deposits and progress payments for all phases of a design project. This mitigates much of the financial risk. Lots of small payments are preferable to a few large payments. As with any business, designers and design companies must manage their cashflow well.
What are the common causes of budget blow-outs?
Blow-outs come about when assumptions that were made early in the project don’t work out, when a mechanism does not perform as desired or when a key component is not available and major redesign has to happen.
The biggest cause of budget blow-outs is changes to the design specification – the client moving the goalposts. As long as the changes originate on the client side, there should be no argument about an increase in fees or a reduction in other deliverables.
There is also an insidious budget buster for the designer: it comes if the client moves the goalposts one millimetre at the time, until they are far from where they started. The other is the “can you just do me one little favour?” request. Beware the little favour and the creeping goalpost!
Designers must keep a good paper trail. A good proposal allows for a bit of ‘scope creep’. Clients hate to be hassled for small dollar amounts. If the goal posts move to a level where budgets and time lines are affected, then it’s time to start putting things in writing.
Sometimes designers can be modestly cheeky and preface an email with “Regarding your email of X requesting Y: please find updated project schedule and budget below”.
Many clients don’t know or want to believe that designers sell their time. If they can be reminded regularly and politely that designers can do anything clients want, as long as the client respects that they will be billed for it, then things should be okay. Clients don’t like hearing that though.
On the other hand, what happens when the designer wants to move the goal posts?
This depends entirely on the reason for the change. A well-documented change-request document, outlining the proposed changes and how they will impact budgets, outcomes and deliverables (listed against where the current budget would lead) should form the basis of discussion. Check the proposal and scope to ensure what you’re proposing is legitimate.
It pays to sell the great benefits of the changes to the client. Always look at these issues through your client’s eyes.
I know the DIA does not advocate designers working for free. What is its advice to designers who are offered royalties? What are the traps here?
Here is a direct quote from my just completed “Don’t get ripped off by design” graduate practice note for the DIA (to be launched at the DIA’s Portfolio event at Sydney Design 09):
This is not a discussion about licensing but a warning.
The lure of a large royalty is powerful, and unscrupulous business people use this to their advantage. Beware when a potential client offers you a royalty instead of a fee. This is a sure sign that they do not have the money to pay you.
Royalty arrangements are only appropriate when:
• the designer instigated the project
• the designer owns and has protected the IP
• the designer has approached a potential licensee with a design.
Licensing is an established practice in the toy, furniture and lighting industries.
If you choose to license your design to a manufacturer in return for a royalty income, be aware that:
• it may take years before you receive any money… if ever
• there are many factors outside your control that determine the success of the design
• it is very expensive and time consuming to set up a proper licensing agreement
• it is not in potential licensees’ interests to discourage your idea as they are not paying for the development.
If you have a long-established client and have an idea for a product which could serve as a useful range extension, you may be able to negotiate a profit share for a reduced fee.
(In seventeen years of involvement with industrial design in Australia, I am only aware of three such deals. These involved well-established design consultancies working with long-term clients.)
How do you set realistic goals in projects?
Project goals are realistic in the eyes of the client as matched to the budget. A good brief, a good discussion and a good proposal will help set appropriate aims. A realistic goal is one that can be achieved within the budget. Can we put a man on the moon? Yes! Was the budget huge? Massive!