Deltek Clarity GovCon Project and Risk Management Review
For the ninth year, Deltek has taken the pulse of the government contracting industry through its Clarity survey, and resulting report, with a goal that is twofold: identify key issues impacting the market and forecast trends for the current year and beyond. The 2018 results are in, and we’re excited to share the project and risk management insights, benchmarks and experiences gleaned from the study in hopes this information will serve as useful metrics and a powerful tool for driving your firm’s success.
The Short and Sweet of Project and Risk Management
There is a great deal of optimism in GovCon, organizations are growing quickly and report an increase in both profits and the percentage of projects being delivered on time and on schedule. However, several key project management metrics, including project visibility and maturity, continue to show worrying signs of decline.
Similarly, risk management teams at government contractors are facing maturity problems that go beyond first-level project managers and speak to wider problems at a company level.
Deltek’s 9th Annual Clarity Deep Dive: Project & Risk Management
On Demand Webinar
Top Project Management Challenges
For the first time in three years, the top four reported project management challenges changed, with “inexperienced project managers” and “poorly defined project scope” being the top two challenges. Last year’s top challenge, “accurate project cost forecasting,” fell to fifth in this year’s survey.
Despite inexperienced project managers being cited as the top concern by over a third of respondents, just 34% of organizations reported investing in project management training; down from 51% last year.
While this training statistic is troubling, a positive trend was identified in “data integrity” challenges, with a double-digit drop over the past year. It’s likely that this change can be explained by the adoption of technology solutions, such as enterprise PPM software or data management tools.
After a significant drop in 2017, organizations reported nearly identical levels of visibility into the status of their current projects this year. This metric, however, varied quite a bit by organization size: 13% more small businesses reported low project visibility, while the percentage of medium and large businesses reporting low visibility decreased.
Not surprisingly, there is a positive correlation between organizations that reported low visibility and their inability to deliver projects on time and on budget.
Projects On Budget and On Schedule
Just as with project status visibility, both of these key metrics experienced significant declines in last year’s survey, indicating large problems with project management in the field. However, this year’s study provides a much more positive outlook with a 19 point increase in project being delivered “on or under budget” and “on or ahead of time” increasing by 18 points.
While this positive trend is seen across organizations of all sizes, it is small businesses that are seeing the most success.
Maturity of Project Management Discipline
Though thankfully not linked to unfavorable outcomes in other key metrics, medium to large organizations in particular reported significant drops in the maturity of their project management discipline. Those rating their function “somewhat mature” or “very mature” dropped nearly 10 points.
These shifts are likely due to changes in the workforce with many seasoned project managers reaching retirement and an increased number of inexperienced millennials entering the workforce and filling these roles.
Maturity of Risk/Opportunity Management
After seeing a small uptick in 2017, Clarity results indicated a significant decrease in the maturity of organizations risk/opportunity management this year, with nearly double the percentage of firms citing this discipline as being “very immature.” While the decrease was seen across organizations of all sizes, it was especially stark in large firms, with only 17% rating their risk/opportunity management as “very immature” or “somewhat immature” in 2017, compared to 44% this year.
It is thought that this drop may be linked to a decreased emphasis on employing a chief risk officer (CRO). Last year, 12% of all companies and 21% of large companies employed CROs, compared to only 5% of all companies and 14% of large companies this year.
Situations Triggering Risk/Opportunity Initiatives
Respondents were asked which situations would trigger a risk/opportunity initiative for their organization, and while it is very encouraging that all situations received more support compared to last year, a big warning sign is that companies are only triggering the initiatives in response to an undesirable event.
In order to prevent future problems, organizations of all sizes would benefit from centralizing their risk management functions and increasing proactive monitoring.
This year’s study uncovered a number of exciting positive trends, but also highlighted several troubling challenges facing the project management discipline. I encourage you to watch the on demand webinar now so that you can use these findings to assess the health of your firm then take the next step to make the necessary changes to help you gain a competitive advantage in the industry.
A great place to start is by asking yourself these questions…
- Who is managing risk at my organization?
- What are we doing to both hire and train the individuals who will take my firm’s project management disciple to the next level?
- When was the last time we invested in PM solutions?
About the Study
The 9th Annual Deltek Clarity GovCon Industry Study provides critical benchmarks and insight for project and risk management, as well as business development, finance, financial compliance, human capital management and information technology to help assess the heath of your firm and steps to take to drive future success.
The 2018 study shares market insights from more than 630 government contractors. This year’s respondents represented all sizes of business with the majority identifying themselves as providing IT services, followed closely by professional services and the defense sector. Healthcare, management consulting and engineering services were also represented in the results. 43% of the companies are headquartered in the Washington, D.C. metro area and surrounding states of Maryland and Virginia, while 55% of respondents call other parts of the U.S. home.
Jason Kinder is the Director of Product Marketing for the Project and Portfolio Management solutions at Deltek, a leading provider of programs controls and earned value management software for project-focused businesses. Jason has more than 15 years of experience in program management specializing in earned value. He spent those years working for Raytheon and L-3 Communications. Jason is the co-author of the EVM and IPM for Dummies books. He holds a BBA from Stephen F. Austin State University.
- Business Development
- Business Infrastructure
- Contract Management
- Cost Management
- Costs and Expenses
- Deltek Clarity
- Deltek Costpoint
- Deltek Insight
- Earned Value Management
- Enterprise Resource Planning
- Financial Management
- Firm Management
- Government Contracting
- Human Capital Management
- KPIs and Analytics
- Project and Portfolio Management
- Project Management
- Resource Planning
- Risk Analysis
- Scheduling and Planning
- Small Business
- Talent Management
- Time and Expense Management