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Entrepreneurs Panel

Steve Purdham
Jeremy Roberts
Michael Oliver
Debbie Pierce
Jennie Johnson
Charlie Mullins
Laura Tenison
Brian Hay
Richard O'Sullivan
Julie Meyer
David Pollock
Tony Caldeira

How do i stop project costs from getting out of control?

Steve Purdham

Has worked in the software industry for more than 25 years. Founded Surfcontrol in the early 80s and built it into a global provider of internet filtering software before it was sold to California-based Websense in 2007 for £201 million. Moved straight onto the launch of We7, an advertising-funded music download company supported by rock legend Peter Gabriel. We7 was relaunched in 2008 as an internet jukebox with 3.5 million songs which users can listen to for free. Purdham is hoping for user figures of two million in 2009.

Question: 

I want to install a relatively sophisticated e-commerce system within the retail company that I own and we’ll need to engage external consultants to do this. I’ve heard a lot of horror stories about such project costs spiralling out of control – what advice do you have to make sure that doesn’t happen?

Answer: 

Yes, there are many horror stories but, to be fair, it is not always the fault of the consultants who often end up getting the blame. The problem is that requirements and priorities change and not enough time is invested in controlling the projects.

Be very clear about what you want, when you want it and what you expect to pay for from the outset.

Talk to someone who has successfully installed the same system – learn their lessons. Make sure enough of your time and the time of your staff is allocated to the project for all phases.

Review progress often and aggressively and make it clear that nothing gets paid for unless signed off by you in advance.

Beware these projects are like building a house – costs and clarity get lost in the last ten per cent of the project before completion.

Consultants are there to help; they will do a lot of the work but you are ultimately responsible, so if it is important to you then control it.

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