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Project Management is a Service Business

Project Management is a Service Business
2009-10-192013-02-11IT managementen
There are Five Dimensions of Service that Project Managers should keep in mind as they provide project management services to their customers and teams. Let's start with a simple question: why do customers switch? Analysis shows that the answer across industries is: 15% because they found a...
Published October 19, 2009 by Michel Operto in IT management

There are Five Dimensions of Service that Project Managers should keep in mind as they provide project management services to their customers and teams.

Let's start with a simple question: why do customers switch?

Analysis shows that the answer across industries is:

  • 15% because they found a better product
  • 15% because they found a cheaper product
  • 20% were bugged by too little contact and individual attention
  • 49% because the attention they received was poor in quality

One of the related quotes I like is from Tom Peters: "More than 2 out of 3 defections can be attributed to how people feel about dealing with you"


So, I propose that Project Managers adopt the goal to understand the five dimensions by which Service is perceived by customers, to recognize the need to establish mechanisms to track and improve effectiveness on these five dimensions, and that they do it.

At the heart of a Service Business are the Customer Requirements. And in this domain: Perception is all there is -- Manage it!

We have to focus on what the customer perceives as important. And the customer perceives how well you meet his needs through 5 service dimensions with unequal importance.

Dimensions     Customers' Weight

  1. Reliability            30%
  2. Responsiveness   25%
  3. Assurance           20%
  4. Empathy             16%
  5. Tangibles              7%

Let's pay closer attention to these dimensions.

1. Reliability    30%

Definition: The ability to perform the promised service dependably and accurately
Measures (example of): First time full resolution of issues, number of Repeat Problems, On time delivery, number of Missed Commitments, Production problems post delivery.

2. Responsiveness   25%

Definition: The willingness to help customers and provide prompt service
Measures (example of): Number of times the phone rings before we respond, Time to return calls and mails, questions left open for a long time.

3. Assurance    20%

Definition: The knowledge and courtesy of yourself and project team members and their ability to convey trust and confidence
Measures (example of): Mostly Subjective, number of similar questions asked several times, number of escalations.

4. Empathy    16%

Definition: The caring, individual attention provided to the customer
Measures (example of): Mostly Subjective, number of follow up calls to the customer, number of unsolicited assistance proposal

5. Tangibles    7%

Definition: The appearance of physical facilities, equipment, Team members, and communication materials
Measure : Very Subjective

So, what can we do?

Keep these 5 dimensions in mind while playing on our strengths:

  • Professional Skills & Experience: Business and Processes knowledge, Tools and Techniques, Risks Identification and Management, Scope definition and changes management, Schedule definition and progress tracking, Contracts implementation, Issues Resolution...


  • Soft skills: Active listening, Innovation, Responsiveness, Knowledge Management and Experience sharing, Reliability, Assurance, Leadership, Empathy, Team building, Transversal management.


As PMs we are well equipped to provide superb services as long as we do not forget to consider that Everyone is a Customer (Team Members, Partners, Suppliers, Customers, Management, Sponsors...).


How to further improve?

Focus on the above 5 Dimensions, Track results systematically and Review them daily, Self-Define improvement plans, Implement them and check progress, Share things that work with others...

Perception is all there is -- Manage it!  And keep in mind that 60% of customer satisfaction is purely subjective.


  • February 19, 2010
    Francisco Thurrell
    Nice post. My friend Lilly told me about this blog some weeks ago but this is the first time I'm visting. I will undoubtedly be back.
  • October 26, 2009
    Eric Le Boënnec

    I definitely agree that project delivery is a service. However, to my perspective, the five dimensions, described above, are from the outcome standpoint or, as expressed, the point of view of the customer. In spite being important, it does not help the provider (i.e. the project manager) to understand the specificities of a service. Therefore, I wonder if any project manager can find a common way to improve their output defined by the five dimensions (i.e. reliability, responsiveness, assurance, empathy and tangibles) if a project is a service.

    I think we first need to define a project like in any good project definition charter. And, I would like to ask you what makes a project a service rather than a product. After all, the S in OBS stands for service. By the way, the analysis data talks about a product rather than service.

    International researches, especially by marketers, have identified four dimensions to a service that makes it different from a product:
    * Heterogeneity: it can vary between members of staff within a same organisation;
    * Intangibility: it cannot be seen, felt or tasted before purchase;
    * Perishability: it cannot be stored, and it can be more difficult to meet peak demand levels;
    * Inseparability: it has to be produced at the same time as it is delivered.

    So, does it make sense? If looking at what customers are expecting from project managers, then I would say yes. I would relate each in the following manner:
    * Reliability: it increases if you can reduce the heterogeneity within a team/organisation or from those part of the project team so that you all act more harmoniously;
    * Responsiveness: it can increase by making project teams less heterogeneous (i.e. less under volume pressure, so more available) and by increasing project capacity (i.e. more project resources available from other part of the organisation to cope with demand) to reduce perishability;
    * Assurance: is a request to counter the coupling effect of intangibility and heterogeneity that creates anxiety on the client side, but inseparability cannot remove the risk until final delivery; I think one can only improve by showing knowledge, professionalism and transparency from the first minute of a project;
    * Empathy: reducing inseparability and intangibility can be achieved from the first stage of initiation of the project by showing real will to collect true and fair information about the project and to include them into the charter's definition of the objectives;
    * Tangible: it is to turn the intangibility of a project into concrete perspective, which is showing strong knowledge through the team in all knowledge areas (PMI) and communicating plan and progress very regularly.

    The conclusions drawn are absolutely correct. Nevertheless, I would add two more:
    * To managers in organisations: do not overuse your resources and learn to manage project portfolio, because your customers become unsatisfied even though projects are delivered on time and on budget;
    * To freelance project managers: do not oversell yourself for reasons similar to managers in organisations.

    To that matter, I would like to remind everyone that satisfaction and dissatisfaction are the opposite sides of the same coin. Quickly, satisfaction deals with external values such as effectiveness (i.e. you have done what you said you will do) whereas dissatisfaction deals with intrinsic values such as quality (i.e. yes you were effective but I expect the whatever to have cost me less time for instance).

    Finally, from my international experience, I know that the dimensions of the above document might have their priority altered by the country culture. If having to work with Nordics or Germans, showing reliability and responsiveness through professional knowledge should bring trust whereas my experience in France says that you will have to work primarily on assurance and empathy.

    Also, depending on the aim of the project, it might even be very tricky to consider above line of professional duties some of them. Empathy can drag you into local political game on your client side. So, you better stick to the guidelines provided by the sponsor and ask for regular (written) advices. One way for a project manager to circumvent such a situation is to work out a forcefield diagram which will remain useful during the whole project to manage relations and communication.

    Best regards,

  • October 23, 2009
    Well said Michel - I can not agree more to your writing. It is essential that organizations equip themselves with assessments tools that not only assess the 5 areas discussed above BUT also provide insight and a roadmap in achieving excellence. Knowledge is such a key component, and hence KM and continuous improvement goes hand-in-hand....
  • October 22, 2009
    Perception is very important and with that it would benefit every PM organization to honor the time tested and researched reality that you can only manage two of the three prongs in a project (Time, Cost, Quality) also known as the Project Triangle.

    So long as organizations (and this is every single organization I have ever been involved with or competed against) continues to promise delivery of all three, then any means to manage perception will have a high probability for failure.

    The discussion on Project Management should begin here and if done well, it should also be the jumping off point for positive perception.

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