The Risk Reward

I was in a meeting last week where a potential new client asked why there exists such a price fluctuation between competitors in our industry when they are all purchasing from roughly the same vendors, at roughly the same price, and within the bounds of the same project. Assume for a moment that we’re removing product margin from the equation, which didn’t play a factor in this proposal. Reading between the lines, the client was clearly posing this question: “can you please validate why your proposition is more costly than your competitors?”

A valid question indeed.

It got me thinking about what I like to refer to as the “Project Gap”.  In every audio-visual project, regardless of the company, there is a gap. While it always exists, it does look different from company to company. 

This gap most commonly resides between the sales phase and the production phase of the project, when the hand-off takes place from one department to the next, but the location of that gap in the project’s timeline can be different for each organization.

The reason that the gap gets created also looks different for each organization.  It can be the result of many things including, but not limited to, procurement procedures, project management procedures or lack thereof, engineering review or lack thereof, a shortage of qualified and experienced staff, lack of documentation, etc. etc.

This gap poses a potential problem for the client and their end-users, so properly filling this gap is key to a successful deployment. Depending on how its done, filling this gap can demonstrate consistent control in your coordination tasks throughout the project cycle, leaving the client feeling confident in their choice to hire your firm.

So we’ve established that this gap always exists, now what do we do about it?

There exist 2 methods for filling this gap within a project.

Option #1: The Intentional Overlap

The first method for closing this gap is by filling it out with project management hours and engineering hours.  Those hours should accommodate for qualified and dedicated personnel, allocated to your project, from each department to pave over that gap in support of a smooth transition from concept to implementation. 

Let’s use the example of a new-build construction project.  Before any hammers can start flying, prime consultants and architects are leading design teams, consisting of qualified professionals, through the “Conceptual Design” stage of the project, where ideas are free-flowing and the overall vision begins to take shape.  Next is the “Design Development” phase, where ideas become plans. The final phase of the design process is known as the “Construction” phase, which is where the dust flies. Each discipline within that design team is required to carry their initiatives through each phase in an effort to maintain design consistency and fill the gaps between ideas and reality.  Without that consistency, it becomes a game of broken telephone from tip to tail.  

In our proposal, engineering hours are utilized for knowledgeable staff to support the conceptual and development phases of the project. Once the decisions are made through those phases, we document the design decisions for reference during the Construction phase of the project.  Project management hours are also used to engage qualified project management staff in reviewing the process from award all the way through the Construction and Closeout phases of a project in an effort to maintain consistency throughout the project’s lifecycle. Engineering and project management are simultaneously engaged throughout this process.  

You can think of our process as creating what we like to refer to as the “intentional overlap”.  An intentional overlap creates a space within a project’s lifecycle to support deliberate paths of communication, design reviews, on-site coordination, and procurement planning – all before the first boots hit the ground. That coordination needs to be done by qualified professionals, so that time and experience needs to be captured in the overall budget of the project.  

Option #2: Risk

The other option is to fill that gap with Risk.  

Risk that details don’t make it from one phase to the next, risk that the clients original requests get missed, risk that the infrastructure requirements don’t get properly coordinated, etc, etc. 

I have to ask myself: “If I were in the client’s shoes, what type of questions should I ask to make sure that the gap gets properly filled?”

If I were asking the questions and trying to filter out which firm has not truly accounted for this overlap time, I’d be asking the following:

Engineering:

  1. Can you please indicate where in your proposal your costs are accounted for in regard to Engineering hours?
  2. Can you please define what those engineering hours represent and what they will be used for?
  3. What are the relevant certifications that your design team holds to prove their competency in this industry?
  4. How many design development meetings are we accounting for throughout the design process?
  5. How many construction meetings are we accounting for throughout the design process?
  6. How many drawing submissions have we accounted for throughout the lifecycle of the project?  

Project Management

  1. Can you please indicate where in your proposal your costs are accounted for in regard to project management hours?
  2. Can you please define what those project management hours represent and what they will be used for?
  3. What are the relevant certifications that your team holds to prove their competency in this industry?
  4. How many construction meetings are we accounting for throughout the lifecycle of the project?

Lastly, as a client, it would be helpful to understand an AV firm’s staffing situation.  While it’s very common in the current AV market to utilize sub-trades for portions of the AV installation process, such as pulling cables, mounting products, and cable termination, the risk to the client is that the integrator relies so heavily on 3rd party organizations for their labour resources that they can’t truly support you as a client past the base installation.  While scheduling an extra set of hands to pull cable on day 1 of an installation can be a great way to scale a team as necessary, attempting to schedule a 3rd party programmer to change a feature or to debug a problem once its discovered on the spot is less than ideal. The same rules apply to engineering and project management.  These roles should be filled by competent and reliable full-time staff to support a client over the long-haul.   

So we can fill the “Project Gap” with time and management, or we can fill it with risk – the decision is up to you.

Which would you rather fill it with?