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Project Management: LLC's Decision-making Process Around Cultivation

Prioritizing grant projects wasn't anything new to us as a nonprofit, but when we started delving into consulting projects, we grappled with the best processes for ensuring they were on budget, on time and of high quality, and the best way to select new projects. Many nonprofits are already familiar with concepts like the Dual-bottom Line matrix for prioritizing grant projects, where organizations are trying to find a happy medium between financial sustainability and strong mission impact alignment. High mission impact, high sustainability projects are no brainers to take on. Low mission impact, low sustainability programs are probably opportunities the organization should stop pursuing. Then deciding between high impact low sustainability and low impact high sustainability projects depend on resources such as time and money. Hopefully, your organization has a good portfolio of projects allowing for an overall organizational balance of mission impact and financial sustainability.

Some of the same concepts can be applied to taking on a consulting project, as we found out. However, we decided to expand our list of lenses from which to view our project with a long list of questions about the potential benefits of the project, including whether the project allows us to share knowledge with the field, whether there is a strong learning opportunity, and yes, how much this project aligns with our core mission work. (Please feel free to post your own criteria for selection below, if you have it.)
Once we have a list of potential consulting projects and have narrowed down the projects according to which are the most interesting to our organization, then we scope them out. Project management talks about the “Triple Constraints” of a project, which are traditionally “scope”, “cost” and “time,” and before taking on a project, all three of these have to be detailed and sent to the client in the final proposal.
Our first step after talking with a potential client is to create a scope of work, something universal in both nonprofit and for-profit fields. A scope of work details the activities to be performed in the project (sometimes broken down into more detailed tasks), the deliverables, and the timeline, including general deadlines. Sometimes a scope of work is part of a broader document called a “charter,” a “statement of work,” or one of many other names that also has a cost-benefit analysis and delineates the risks inherent in the project. One trick of the trade I have learned is that sometimes it’s also a good idea to delineate what’s not in scope, especially when collaborating with other organizations on a project. This helps avoid confusion later on about roles and who is responsible for what.
For Leadership Learning Community, the costs of our projects break down into expenses and staff costs. We calculate our staff costs in billable hours so once the scope has delineated the tasks, we can set about estimating the cost of hours.
For our work we came up with a template for budgeting that will automatically calculate the rate for the person. This allows us to figure out how many hours the project will take and have the spreadsheet automatically calculate it for us. 
Estimating hours is one of the greatest challenges inherent in calculating our costs. There are many articles and techniques that talk about these issues, but one thing is clear from all the studies I’ve read: people quite often underestimate. This creates difficulties both internally if a project is underestimated and then goes over budget, and externally if the client thinks it should take less time than it really does. So, accuracy is key and good for the benefit of all. 
One of the main techniques we use to ensure accurate estimation is historical data. We use the time-tracking application called Harvest, which allows us to track our hours on a project. When we do a project that is similar in scope to a previous project we’ve done, we can then reference the old project and determine based on real data what the likely time allotment is for the new project.
There are also several indirect costs inherent in projects. The mere act opening the doors to the organization each day has several costs such as rent, power, utilities, not to mention administrative and human resources costs.
Once the activities of the project are known and the costs of the project are calculated, it’s time to look at the schedule. Often the potential client already has a timeframe in mind and it’s a matter of determining whether the timeline is feasible due to constraints of staffing and of outside factors such as time constraints like holiday timing and logistical constraints like .
This is a good time to cross-reference the project schedule with your internal capacity. We talked in our last article about our quarterly process of creating a capacity spreadsheet where everyone calculates their hours for the next quarter based on the number of hours they’re already assigned to projects. This allows the project manager (or other title with the same responsibilities) to calculate whether the project is feasible with the current staffing or whether perhaps another person would need to be hired, either as a staff member or a consultant, to complete the project in the timeline specified.
Oftentimes, projects will last beyond a quarter, in which case it’s good to reference the organizational timeline I mentioned in the last article, to see how many projects are occurring simultaneously. If your timeline has deliverables dates and major events like conferences, this also allows you to find out points of greater busy-ness.
The cultivation process is actually quite a time-intensive project if it’s done right. The process of selecting, planning, estimating, scheduling and detailing the activities for a project proposal is a lot of up-front work before the project is even started or accepted. Nonetheless, this helps in the long run to ensure costs are within range, the deliverables are of high quality, and the project is on time.