Into the dragons' den

The role of the project sponsor, and the relationship with the project manager, is a vital ingredient in business. Adrian Taggart and John Bolton of PMProfessional Learning make comparisons with TVs popular Dragons Den programme and point out that even here, there is a lot more going on than meets the eye.

There they are, sitting comfortably and about to pass judgement on the next range of bright ideas from dedicated and committed people who have their dream of a lifetime. They are the Dragons; that select band who have the power to turn those dreams into reality.

As well as immediate funding for product development they have at their disposal a formidable package of those black arts so necessary for converting excellent ideas into excellent profits. Expertise in marketing, an enviable array of contacts, commercial acumen, political and influencing skills are all potentially on offer, let alone the subsequent media exposure.

Across the room from them are the candidates. To the party they bring product expertise and seemingly inexhaustible supplies of tenacity, enthusiasm and energy.

In these respects the parties conform to the idealised model of sponsorand project manager and the Dragons Den experience is akin to a projects stage gate review. Accordingly the production provides a wonderful opportunity to explore the role of the sponsor and their interaction with the project and its manager.

We shouldnt ignore the fact that for the purposes of facilitating the TV programme, the arrangement in the Dragons Den is skewed from the conventional project arrangement. Specifically, few project managers bear the degree of financial risk as do our candidates, and the project manager approaching the sponsor to request their involvement is the reverse of the usual arrangement, but these should not detract from the fact that much can be learned from these bruising encounters. If more stage gate reviews were more like the Dragons Den experience then perhaps far fewer projects would end in expensive failure.

In general, the thought processes and the directness of the questioning are attributes that many sponsors could benefit from learning, but on top of this there are some specific points which are worthy of reflection.

(Above: Adrian Taggart (left) and John Bolton believe that the Dragons fabled commcercial acumen enables them to chase the best projects.)

The focus on the benefit

The first point to note is the motivation of the parties. The candidates talk about profit but they are driven by something else: a passion for the product. For the Dragons the reverse is true. The candidates dream of seeing their product in shops and peoples homes: the Dragons dream of sales revenues.

This is not a criticism of the Dragons, far from it in fact. A project managers role is to deliver working products (within agreed constraints) whereas the role of the sponsor is to deliver the maximum benefit possible from the use of that product.

They are both essential roles but they are very different.

For the project manager it is the ecstasy and agony of taking ideas and delivering working prototypes. If we were able to communicate to the younger generation just how downright exciting and satisfying this is, the future of our manufacturing industry would be safe for ever. But by the same token we must also acknowledge just how hard the hard knocks are in this difficult pursuit.

It is not surprising, therefore, that our candidates have unswerving, often blinding, devotion and commitment to their products: they simply would not have got this far without it. Much of the appeal of the TV encounters derives from the Dragons stripping away this emotional veneer and exposing the essence of the idea (with varying degrees of success), and crucially assessing the capability for making money: in project terms of realising benefit.

In doing this the instincts of the Dragons are more concerned with marketing than technical excellence of the product. To their core they know the wisdom of the expression if you havent got a market then you havent got a business and that this holds true regardless of the technical excellence of the product or indeed the quality of the endeavours management team.

For them they need to see a thread of logic linking a real need (derived from a problem or opportunity) linking to a product that satisfactorily addresses that need within certain constraints (cost, safety, size, scalability etc.), for which there are customers (in sufficient numbers) who can easily be accessed and who have the money and inclination to buy.

As with a stage gate review the purpose of the exercise is to decide whether it is worth continuing with the project. In essence the exercise involves comparison of cost and benefit. It is the Dragons frank, direct and often cold emphasis on the latter that makes them special. Technical excellence of the product, on its own, is not sufficient to warrant further funding. For the tenacious candidate this can be a bitter lesson to learn as they see their dreams consumed in the ferocity of a Dragons verbal fireball.

Stakeholder management and the political fixer

Whereas concentration on the hard cash piled up in front of the Dragons makes for iconic TV camera shots, it does understate the involvement of the Dragons. Apart from the fact that the Dragons stand to make a fortune from their investments, the programme also fails to emphasise the array of skills the Dragons have to offer and which are so very necessary if the endeavour is to be a success.

The canny (and usually successful) candidates recognise this. Under questioning they will admit that there are plenty of other sources of funding available, but none come with the added bonus of a Dragon. They understand that there is more to making money than just a good product.

This is most obvious when a number of Dragons recognise the potential of an individual candidate and proceed to court favour with them. It is here that we learn of the capacity of the Dragons to exert influence over the people, particularly those in the fields of distribution and retail sales, who will ultimately determine the fate of the venture. We see them brag about their access to and familiarity with market leaders, and attempt to out-score each other on the magnitude of their previous successes.

The need for a project sponsor to be a political fixer and to exert influence over principal stakeholders is much underestimated. Many feel stakeholder management is the sole preserve of project managers but in the Den we see clearly that it is the Dragons who possess the necessary persona, confidence, character, thick skin, general manner and chutzpah that gets those important people to say Yes.

Alignment with strategy

There is another important point to note from the Dragons seduction of the most promising candidates. It relates to the innate skill the Dragons have for identifying potential synergy by alignment of a candidates product with their own existing portfolio of business interests.

This is an example of the need for a sponsor to ensure strategic alignment between their organisations long-term plans and its projects. Within a conventional project scenario it is only the sponsor within the project team who is privy to the strategic plans of the organisation. It is he or she who has the knowledge about where the organisation is planning to be in two, five or ten years time and it is they who are obliged to ensure that any project undertaken is supportive of, and consistent with, those plans.

Dragons have a clear idea of where they want to be in the future. Their business portfolios are carefully crafted and shaped to take them into distinct and lucrative markets. When an idea is presented to them that can significantly contribute to this strategy, and by return they can offer an existing set-up that is wholly supportive of the idea, then we see their eyes light up and the detached criticism morphs into seductive charm.

Synergy is a much abused word but here we see it in its truest sense. Careful selection of candidate projects for inclusion in portfolios gives double advantage. The first advantage relates to cost whereby the existing project support structure for the portfolio is capable of supporting the new project with little alteration. Economies of scale and existing expertise are ripe for harvesting. The second advantage relates to benefit. Not only can the new project deliver benefits in their own right but also, critically, they promote and enhance the attraction of other projects within the portfolio. Marrying a talented chef to an attractive venue provides a collective benefit greater than the sum of the benefits of the individual parts acting alone.

The ability to select projects on this basis is at the heart of the Dragons fabled commercial acumen.

Management of risk

As we have suggested, the unassailable faith that candidates have in their ideas is perhaps a necessary requirement to bring them this far. However, such single-mindedness, often alloyed with a degree of naivety, denies candidates the ability to properly assess the risks of failure. Not so for our Dragons.

This is perhaps most evident when candidates offer their view of their companys worth. Their answers reveal that, in their own minds, possibilities have become certainties and optimistic forecasts have become conservative forecasts. The numbers stand in stark contrast to the assessments of the seasoned and world-weary Dragons.

For sure, initial assessments, on both sides, are opening gambits for a negotiation but even allowing for the margins so imposed it is clear that there are differing viewpoints. Part of this is due to the Dragons understanding of business case risks above just the technical risks, but it is helped by the absence of any emotional capital vested in the project.

It is noteworthy that most candidates treat their prototypes with care and affection whereas the first inclination of the Dragon is often to pull the thing apart. The former views the world with a designers eye, the latter with the eye of a customer. Thus the pictures of a childs toy shredded into pieces capable of choking an infant eloquently point to inherent but hitherto unrecognised risk.

In a conventional project sense we can attribute this to two advantages the sponsors have when assessing risk.

Firstly they have a wider view than the project managers and it includes the business case risks. These are risks to the venture beyond those related just to the technical sufficiency of the product (ie. those conventionally managed by the project manager) and include those associated with marketing as discussed above. This enables them to have a more realistic perspective on the overall chance of success.

The second relates to their view of those technical, product related risks. Working, as they do, with their noses to the grindstone, project managers often lose sight of the bigger picture and with it, all sense of perspective. Sponsors are more capable of seeing the helicopter view or indeed being able to separate the wood from the trees. Being one step removed from these risks enables them to be more objective and matter-of-fact. In this sense they are able to provide an invaluable service. Intelligent questioning and appropriate supportive behaviour can go a long way in acknowledging and treating such risks.

Summary

The attraction of the programme is derived from the confrontation between the two parties. In terms of skills, knowledge, access to resources, mannerisms, appearances etc. the over confident Dragons are poles apart from the camera-shy candidates. As implied by the title of the programme we expect scenes reminiscent of the Coliseum with these meek candidates crumbling in the face of the rapier-like questioning and damning opinions of the mighty Dragons.

This all makes for good TV but there is more going on than meets the eye.

Sponsors and project managers are very different types of people and they carry out very different roles. They are, however, ultimately reliant upon each other for success and at best the conflict at the heart of their interaction is ultimately positive. It involves each party probing, challenging and testing the other for the greater good. It may owe more to Darwin than an MBA syllabus but it is ultimately successful in the destruction of the weak ideas and the promotion of only the strong ideas. In this sense the scene in the Den is indeed the perfect project stage gate review.

This can only come about by the contrast between the two participants. If they were clones of each other it simply would not work. For all their revered status the reality is that the Dragons would not be where they were without products and the people who pioneer those products. The Dragons need the candidates and their ideas as much as the latter need the former.

• Adrian Taggart and John Bolton are both consultants with PMProfessional Learning (PMPL) delivering public and bespoke corporate learning events. With in excess of 40 years of experience between them, they are passionate about the value of the sponsor to professional project management. They have both been instrumental in the development of PMPLs new course The role of the sponsor.