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  • Writer's pictureJamie Leeper

Project management companies: Selecting a partner

Updated: Jul 30, 2019

There are obviously many variables that come into consideration when selecting from thousands of available project management companies, but we are only going to take a look at what we view as the 5 most important things to remember during this process. We feel that too often, procuring services is treated in the same way as commodities and this unfortunately ends in disaster more often than not.

Warren Buffet price vs cost explanation
When evaluating project management companies it is much more important to look at value rather than cost.

Think about this: if you are in desperate need of a root canal, you hopefully wouldn't type "cheapest root canal Kansas City" into your search engine. You instead would look for the dentist with the best reviews or a referral from a friend or other medical professional. So when it comes to selecting project management professionals, why do so many multi-site brands insist on awarding work to the lowest bidders? We believe that the following 6 factors are far more important to consider when selecting a service provider who is going to deliver what you are looking for.

1. References - Speak to at least 5 people and ask them the tough questions. What they like, what they don't like and what they would like to see done differently.

2. Current performance - speak to other vendors about how the service company treats them. Are they paid on time and more importantly are they paid what was agreed upon? What does the communication look like? How do they handle Q&A, customer service, and warranties? What happens when items are not agreed upon? How are deliverables shared from the field, to the service company, and ultimately to the end client?

3. Pilot program performance - If possible you should take advantage of running a pilot program instead of simply sending everything to RFP and then making a decision purely on who put the smallest number in the box. The challenge with RFPs is that they can be very ambiguous and unfortunately many companies will take advantage of this by providing you with a small number in the bid, but then manipulating things to make their profit in other directions. This is a very transactional approach to procurement and one that rarely ends in a win-win situation.

4. Professionalism - What does their communication look like? Is it professional? Is it automated? How quickly do you get a response, and how good is that response? How do the employees look? Are they in uniform with company logos, or is this something that is not considered important? These service providers will be the ones interacting with associates and customers within your stores, and things can go south pretty quickly if the wrong vendor gets to connect with your personnel.

5. Focus of conversation - During your interactions, what does the vendor focus on? Are they driven by customer service, speed of service, or cost? Are you confident that they will be able to provide the deliverables that you are looking for? Do they say that they can provide every single solution you are looking for? This is frequently a sign of desperation to win your business so be cautious of those companies who over promise on the front end.

6. Due Diligence - Do your research and see if there are any things out there that set the alarm bells ringing. What does their review on Google/ Yelp/ Facebook/ BBB etc. look like? Are there any message boards that discuss negative aspects of this company? Any negative press or lawsuits associated with the company or it's owners and employees? These things can take some time to perform, but are well worth it when you find the right partner who works alongside you for many years.

I am fairly confident that many of you reading this will immediately be shocked that COST isn't included. I can even sense a few of you are frantically hitting "Ctrl F" in hope of finding it! You can stop looking as it's not here...

We do not believe that cost is a key factor when considering the CORRECT partner for your multisite project management needs. If you are searching for the lowest cost provider and the cheapest option, then you should probably look elsewhere as that isn't how our team operates.

We understand that total cost and value are critical figures that need to be tracked and analyzed, but if you are focused on cost in the beginning, then the only thing on your partner's mind throughout the engagement is also likely to be cost.

I had lunch with a good friend of mine last week and he shared this brilliant comment with me:

"If you win their business on price, you'll also lose their business on price".

This is such a simple, yet frequently overlooked issue that truly can make or break your business engagements. If the only thing that you are worried about is price, the chances are that your partner will see this, and will bid your work accordingly. The challenge that we often see is that as the client is often looking to reduce the price, the vendor obliges because they need the work to keep the roof above their head. However, the vendor isn't prepared to lose margin so he instead looks to make adjustments in other directions. Three simple things that we often see in the industry are using a lower quality of product, using general labor instead of trade experts with the required license (when needed), and playing games to drive up the total revenue.

Services should not be treated as commodities. You get what you pay for, so make the right decision from the start and look for total value rather than initial cost.

This all goes on behind the scenes, and the first you know of it is when your store manager calls to complain about the state of the vendor in her store, and how they have been onsite for 2 hours but still aren't sure what they should be doing. You then get a call from your Director of Operations who wants to know why your store looks like it has just been hit by a tornado, and then you hear from your CTO who wants to understand why your POS system isn't working, before reading a Yelp review about a customer's awful experience at your store.

You chose the lowest cost provider when selecting your vendors, but how much are these challenges now costing you? How much business is being lost due to your uncomfortable store? How is staff morale as they see that the company's focus is on minimizing expenses, instead of strengthening the brand and growing revenue? What does it cost HR to replace these want-away employees? A lot of these issues rarely cross the mind of a facility maintenance professional or project manager, but they should be factored in as a result of your choices and vendor selection.

If you are struggling to find the right service provider to meet your multi-site facility maintenance needs, and would like to receive a complimentary consultation from a company with over 25 years of experience of doing the right thing, schedule a call today

P.S. Be sure to remember this nugget of advice from the legendary investor, Mr. Warren Buffet:

"Price is What you Pay, and Value is what you Get"

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