46 ways to save costs and add value as an IT program manager

I am often asked for guidance on costs overruns — and not necessarily at the
end of projects.

Often projects heading south are in the middle of their execution phase when
the program manager or project manager “does the right thing” and calls it out.

But with customers demanding ever-tighter schedules and expanding
scope, controlling and reducing costs can be a real struggle for a rushed and
overwrought PM.

There is a whole industry dedicated to providing advice on cost savings, but the
advice is usually targeted at operational department managers or small
businesses. Tips can involve outsourcing, insourcing, supplier negotiation,
leasing and re-financing and eliminating redundancy (check out these great
articles from Harvard Business Review and American Express).

But where should program managers and project managers look for cost
savings?

Undoubtedly, as any good program manager will know, there are
already policies laid out for corporate and strategic cost savings. It’s likely that
the organization will have a proven method and procedure for reducing costs in
place. These tactics can be implemented within your program, and one benefit
of this approach is that it helps align the program more tightly to the
organization’s overall strategic objectives.

But how can we cut costs on a day-to-day basis in projects?

Listed below are my 46 favourite ways of reducing costs without sacrificing
quality. Let me know what you think.

1. Remove non-value-adding activities. Ask, why are we doing this in the first
   place?
2. Consider inspection a cost with no value added. Remember, “right-first time” should resolve the need for inspections.
3. Stop chasing purchase orders. This takes time, and if a supplier is unreliable, the supplier should be changed.
4. Cut duplication, e.g. entering two sets of time sheets is one of the most common examples.
5. Reduce overproduction, e.g. doing more than is required.
6. Examine paperwork. How much of the bureaucracy is really necessary? Can the program claim a dispensation, for example?
7. Watch modifications. Unless paid for, modifications are a cost that will have a direct affect on the bottom line.
8. Stop inconsistencies in naming. Do different teams refer to the same artefact using a different word? Resolving this will help lessen confusion.
9. Minimize documentation. Will anyone ever read it?
10. Spot discrepancies. A discrepancy not spotted at the start of a project can lead to major cost issues down the track.
11. Examine warranties. Is a warranty specified in the contract? Is this an upsell opportunity?
12. Watch for ‘over’-design or gold-plated designs. Do we need all these bells and whistles?
13. Keep an eye on lead times. Are they really that long? Have lead times been challenged? What else can take place during this period?
14. Question supervision. Supervision is a direct cost for zero value add. Do we have the right skillset? Do we have the right people in the right roles? Professionals shouldn’t need supervision.
15. Eliminate rework, eliminate costs.
16. Stop checking. See 2) Inspection. A check is a cost to the program and to your project.
17. Eliminate remediation, eliminate re-work, eliminate costs.
18. Reduce admin tasks. See 6) Paperwork. How much administration can be dispensed with or sourced outside of the direct program/project?
19. Stop chasing progress. Are we reporting by exception?
20. Cut unnecessary reporting. Who do these reports go to anyway? Are they ever read?
21. Prevent obsolescence. Ask the question, “is our solution current?”
22. Improve communications. Do people know who to call?
23. Speed up the resourcing process. Why the lag between identifying a requirement and fulfilling that requirement?
24. Eliminate scrap, eliminate costs.
25. Cut back on unnecessary meetings. Is everybody contributing? If people
    are not contributing, do they need to be there?
26. Anticipate complaints. Can we anticipate complaints in our risk and issue
    workshops?
27. Limit testing software. The broader the testing, the higher the costs.
28. Limit prototyping. Ask, is it necessary? Is a prototype just a Production BETA
    version?
29. Uncover the reason for bugs in software. Was it the developer’s lack of skill
    or experience, poor requirements definition or something else?
30. Reduce inaccurate reporting. Do you have personnel that you trust to give
    bad news as well as good?
31. Reduce wrong information. Do you have a team that can “say it straight?”
32. Do away with dual-entry systems. Are you double-handling data?
33. Stop chasing work. Is your work assignment process functioning correctly?
    Is everyone 100% utilized?
34. Reduce illness/stress. Are staff members excited and motivated about your
    program or project? Will a pause now help reduce stress later?
35. Make filing easier. Are documents filed logically and with little effort?
36. Ensure adequate planning. Has everyone been involved? Have all
    comments, positive or negative, been considered?
37. Halt wrong requirements. Do you have a gated approach to prevent wrong
    requirements being worked on?
38. Limit discussion without purpose. Do we have meetings for meeting’s sake?
39. Stop searching for data. Where is the repository? Where is the data
    dictionary?
40. Stop covering for other people. Is the team functioning well?
41. Own problems. Do people report bad news as well as good?
42. Cut back on unnecessary levels of authorization. Are you being restricted in
    your ability to lead the program or project?
43. Ensure the right skillsets. Do you know the skillsets required? If not, who does?
44. Investigate credit notes/ budget write backs. How did these happen? Are there alternatives to writing back?
45. Evaluate budgeting. Are budgets pragmatic, targeted, and do they add value?
46. Make your own personal non-value-add list. Keep this as a PM checklist and refer to it regularly. What other costs can be saved?

I’d love to hear your thoughts on my list and the tasks you would add. Feel free
to share in the comments below.