Government Projects and the Myth of Unlimited Funding

The recent shutdown of the US government aside, we all have the vision that government entities are bloated units with either unlimited funds to spend on projects or little oversight to know when they’ve spent too much. Right? Remember the $500 hammer concept?

Here’s the summary of my experience in project management oversight of government programmes and projects. I’ve worked with three major federal government agencies: the Department of Education, the Department of Defense, and the Food and Drug Administration (FDA). And two out of three of those cared…and I mean really cared…about what they were spending on their projects and programmes.

The Department of Defense cared the least…at least on the project on which I was involved. The process was somewhat needless and they happily paid several layers of management and contractors on the marketing analysis project to get the end report they were seeking. This gave them a clear path to award a huge contract without any concerns over bias toward any one service provider due to my team’s extensive work and detailed analysis report.

The Department of Education and FDA certainly did care. Their coffer was not bottomless. In fact, any delays in finishing portions of the program I was working on for the Department of Education could have resulted in liquidated damages for the delivery organisation - my organisation - due to the sensitive nature of the data that was being handled as part of the contract. Likewise, the FDA cared so much that when we ran into major unexpected data integration issues and churned quickly through the remaining funds allocated for the project, the entire project was canceled even though they had already spent more than $1.2 million on the effort. It was a project that I had taken over for someone else, so I wasn’t necessarily seen as the bad guy and I still have a good relationship with the customer, but it was unsettling at the time to not be able to work out a scenario with the project client where we could move forward and complete the effort with some additional funding.

The bottom line is this. Never assume that the budget isn’t a big issue - even if the client isn’t asking questions about it. Your safest route is to always assume that it is a big issue.

To that end, I now always follow these three principles:

1. Always share budget status weekly with the project client.
2. Always involve my project team in the management of the project financials to some degree to help keep time charging accurate and accountability high.
3. Always keep the overall communication flow with the client high - any resistance to communication can delay the sharing of critical project status information and make it that much more difficult to relay the big issues when they happen. The customer may not be your best friend, but that relationship needs to border on the very friendly rather than stand-offish. The more personal the relationship is the faster key information will flow and the faster critical decisions can happen.

Summary

In addition to working for several years with the federal agencies mentioned in this article, I’ve also worked with several state and city government entities…state universities, state agencies, and city governments. They are no less concerned with funding - in fact their purse strings are actually even tighter. I had one state agency that was so concerned with the project funds that they basically wanted the high priced project manager - me - off the project because they were afraid of blowing through their allotted funds for the effort before the real work was finished. The key is to manage the project financials closely, keep the customer constantly informed - especially if they are interested and concerned - and make efforts to over deliver while under charging if the situation allows for it. Large government contracts and projects can be very lucrative so you want them happy and feeling like you’ve delivered great value rather than leaving them feeling like you’ve just ripped them off.