Technology Stimulation Measures for Small and Medium-sized Enterprises

Project management

7.1 Summary
The goal of the project management is to ensure the best possible conditions for the success of the project. The management capability of the SME Co-ordinator and the quality of the management are essential topics of the project proposal and among the main criteria in the evaluation process. If none of the SMEs have the capability to co-ordinate, this work should be subcontracted to a party outside the consortium. It is important at the start of the project to ensure that all roles and responsibilities in the project management structure are defined and that people with appropriate skills are allocated to each function. The management structure may vary among projects and reflect the particular characteristics of each project.

7.2 The importance of project management

A clearly defined project management structure together with a well developed project plan are the foundations of a smoothly running project. This can be accomplished by, for example, monitoring the scientific progress, setting up a well functioning administration, creating a dynamic consortium, ensuring timely reporting to the Commission, establishing a procedure for handling unforeseen events, etc.

The management capability of the SME Co-ordinator and the quality of the management are essential topics of the project proposal and among the main criteria in the evaluation process. If the SME Co-ordinator does not have the right qualifications, the best solution is to subcontract the work to an external organisation with more experience.

Management structure

It is important at the start of the project to ensure that all roles and responsibilities in the project management structure are defined and that people with appropriate skills are allocated to each function. The key point is that everyone involved must understand and accept their responsibilities, rather than assume that the co-ordinator or the Commission will handle all problems.

The management structure may vary among projects and reflect the particular characteristics of each project. Below is an example of a typical project management structure:

Example of a project management structure

Partners involved and their roles in the project:

The SME Co-ordinator: leads the financial, administrative, and scientific co-ordination of the project, supervises the work of the RTD Performers, organises all project meetings, puts together all reports and forwards them to the Commission. The Co-ordinator must be an SME. More details concerning co-ordination, see below.

Partner: is scientifically and economically responsible for carrying out specific parts/tasks of the project, responsible for preparing scientific and economic reports and for forwarding them to the Co-ordinator. Shall provide data for the technology implementation plan.

Project Steering Committee (one representative from each Partner): This is the main forum through which the project is co-ordinated and controlled. Its terms of reference are normally detailed in the Consortium greement. The Committee participates in all meetings, e, g. the kick-off meeting, the mid-term assessment meeting, the final meeting.

Technical Steering Committee (all task leaders): participates in al 6-months meetings, monitors tasks and addresses exploitation and dissemination issues.

Projects funded by the Commission are undertaken as a collaboration, which means that the partners involved have "joint and several responsibility" for achieving the project goals. Whoever takes on the responsibility as Co-ordinator is not formally taking on any more risk than the other partners. All partners must work to ensure the success of the project, a fact which the Co-ordinator may occasionally need to remind the other partners of during the course of the project!

7.3 Key role of the SME Co-ordinator

The formal role of the Co-ordinator is to be the interface between the Commission and the partners in the consortium, especially concerning administrative matters and the supervision of the work performed by the RTD Performers. The Co-ordinator acts as the distribution point for passing cost statements, reports on deliverables, progress reports, and requests for contract changes to the Project Officer at the Commission and, in return, for distributing cost statement reports, review reports and, most importantly, for transferring payments to the partners.

SMEs may find the administration a greater burden than a consulting firm or research institute used to handling many Commission-funded projects. While it is important to be aware of the amount of work involved, SMEs should not be deterred from taking on this role. It is looked upon as positive, since its focus on obtaining exploitable results is strong.

7.4 Management tools

The planning and implementation of a project will be simplified by using different management tools from the start. By using these you can, for example, get a much better overview of the different tasks to be performed and in which sequence/order they should be carried out. The management structure and the implementation of the project should be thoroughly discussed already during the preparation of the proposal.

The most commonly used management tools are:

Work Breakdown Structure shows the breakdown of the project into main tasks and subtasks.

GANTT diagram or bar chart forms a list of all defined tasks and shows their duration and starting/completion dates.

PERT diagram shows all elementary tasks on a chart where all the links between the tasks are represented.

Milestones are specific and measurable deliverables that are defined at intermediate stages within and at the end of the project. They are represented on the GANTT diagram with a diamond-shaped symbol. Milestones and deliverables can also be presented in a table.

7.5 Strategic management

Once the contract commencement date has passed, the project is formally underway and must start to work and deliver according to the milestones specified. It is therefore important to get things moving as soon as possible. Projects tend to lose most time at the beginning.

The function of Commission control through the Project Officers is to monitor the progress of the project and to ensure that the contract is being executed as intended. Project Officers are people with good technical or industrial backgrounds and with a genuine interest in the progress of the project and in ensuring its success. A Project Officer can be extremely helpful to the project manager in imposing discipline on uncommitted partners.

The project might be given a Project Technical Advisor (PTA). The PTA assists the Commission in monitoring the project and the research work performed. The PTA's goal is to help the SMEs to reach their goals and he/she works under confidentiality.

Starting up the project - checklist

  • notify all partners of the contract commencement date

  • introduce yourself as the Co-ordinator

  • find out your contact points and their position

  • set date for kick-off meeting

  • check the status of the consortium and

  • set up and distribute proposals for all management procedures to be approved at kick-off

  • introduce yourself to the Project Officer and inform him/her that the project has started

7.6 Scientific management

Project administration

The Co-ordinator shall be in charge of the scientific part of the project. This means that he/she supervises especially the work of the RTD Performers. The tasks of the RTD Performers can be further defined by the Consortium Agreement.

Even the most clearly defined projects can be brought to a complete halt by inadequate administration. Use of incompatible word processing systems, for example, can lead to significant delays in preparing progress reports, which in turn can delay the approval of payments, sometimes causing staff to be diverted to other work. Different document numbering conventions can lead partners to use the wrong release of a design document, which can result in wasted work. Lack of approval procedures may result in publication of commercially sensitive information.

Each project must determine the administration rules appropriate to the aspirations and operating styles of the participants and to the size of the project. There is no standard solution.

Project administration - checklist

  • reporting procedures

  • lists for distribution of reports

  • contact: technical matters

  • contact: contractual matters

  • standard document layout

  • document numbering

  • filing system (electronic and physical)

  • document formats (word processing system)

  • other electronic facilities

  • document maintenance and control

  • guidelines for external presentations and publications


In the early stage of a project, it may be a good idea to arrange a sequence of meetings quite close together. This will help to establish good contacts between the partners, and help to develop momentum in the work.

Golden rules for project meetings

  • plan meeting dates well in advance to ensure the availability of people

  • ensure that an agenda is agreed upon in advance

  • check understanding and agreement - keep in mind that most partners will be working in a foreign language!

  • document who was present, what was discussed and what was agreed

  • try to minimise the risks of participants arriving late

  • make sure that each participant has good instructions on how to find the venue

At least three meetings should be held:

Kick-off meeting: this meeting should be held to formally start the project. The kick-off normally takes place at the site of the Co-ordinator, not later than one month after thecontract starting date. The main objective of the kick-off is to precisely define the tasks of each participant and the work schedule for the first 6 months. All aspects of how the project is to be run, what is expected of each partner, and what milestone goals are to be achieved should be discussed thoroughly.

6-months meeting: This meeting is important for checking the progress of the RTD Performers' inputs, and for discussing with the SMEs whether they are satisfied with these inputs. Any possible delays in carrying out the work, and ways and means of adjusting it should be notified to the Project Officer at the Commission.

12-months meeting (mid-term report): This meeting is a key milestone. A progress review will reveal any differences between the scientific results obtained and the requirements of the project work programme, leading to a decision concerning:

  • the continuation of the project in accordance with the work programme, or

  • a reorientation of the project if it is necessary, and

  • the procedures to be taken for managing future exploitation of results

The mid-term report should be sent to the Commission for approval within one month after the meeting and shall contain information on:

  • technical and scientific progress, compared to the milestones and evaluation of the work programme

  • a sample of the product/s with measurable characteristics, etc.

  • the consumption of resources in man-days, and the expenses compared with the forecast of the work programme

  • industrial and exploitation perspectives

18-months meeting: not obligatory, but, if organised, this meeting aims particularly at making sure that every partner has fulfilled their tasks and compiled their progress reports, including deliverables compared to forecasted milestones. Other aims are preparation of cost statements and preparing SMEs for their tasks of validating and testing the RTD results. The technology implementation plan is a major task to deal with, and another task is to decide on exploitation issues.

Final meeting: to prepare the final meeting, the Co-ordinator shall monitor the tasks of the participating SMEs concerning validation of RTD results and tests in their own facilities and ensure the feed-back of these results to the RTD Performers. The Co-ordinator will obtain the technical and financial reports, compile, and consolidate them into the final report. The Co-ordinator is also responsible for submitting a summary of the Technology Implementation Plan to the Commission; the contractors (on their ownor via the Co-ordinator) submit individual plans (see section 8).

Progress reports

Progress reports are due every six or twelve months (see your CRAFT Contract). They should cover the progress of the work, resources expended and any deviations from the work plan. Resources expended should be presented in such a way that they can be cross-checked with the cost statements (see below).

In addition to the project data, an update on the state-of the-art, on contacts with other projects, and on exploitation of results to date is expected.

Progress reports do not have to be extensive. The Co-ordinator can facilitate the partners' preparing of progress reports by issuing a clear structure and a list of questions to be answered by each partner. It is recommended that the Co-ordinator requires from each partner a monthly progress report where deviations from the work programme are pointed out and corrective actions are indicated.

7.7 Administrative management

Consortium Agreement

It is highly recommendable that each project have a Consortium Agreement. This agreement must not contradict the articles in the model contract, but should rather be seen as a useful complement to the contract. The main subject matters are, for example, co-ordination structure, confidentiality, publication, IPR, ownership and exploitation of results, liability, settlement of dispute (see section 5).

Financial management

Distribution of money

All payments by the Commission are made to the SME Co-ordinator, who is responsible for the immediate transfer of the money to the RTD Perfomers and SMEs concerned. At the commencement of the project, i.e. once the contract has been signed, an advance payment will be made.

Cost statement

Cost statements are the basis for interim payments by the Commission to the consortium. They are supplied every 6 or 12 months (see specific conditions in the contract).

A simple rule: no cost statements - no further payments from the Commission!

It is in the consortium's interest to prepare cost statements as quickly as possible after the end of each accounting period. There can be a 3-4 months' delay between submission of cost statements and actual payments, so very firm deadlines should be set.

Payment is made on receipt of cost statements and approval of deliverables. Once the cost statements are received, they will be checked, and one or two months later a report will be sent to the Co-ordinator outlining what has been approved and the basis for calculating payments including exchange rates used.

The submission of cost statements to the Commission is the Co-ordinator's responsibility. It is recommended that the partners send their cost statements to the Co-ordinator on a monthly basis, which enables a better follow-up by the partners as well as by the Co-ordinator.

Budgetary redistribution

The budget in the contract may be subject to change, in the form of redistribution of the SMEs' contributions as well as of the RTD Performers' budgets. Usually, there is no problem in redistributing a budget, as long as the eligibility criteria are not infringed or a higher financial contribution from the Commission is required.

Redistributions must be agreed upon by all partners, and on approval by the Commission amendments are made to the contracts as well as to the consortium agreement.

The redistributions and amendments can be discussed att one of the regular project meetings, or the matter can be settled by other means of communication prior to the next meeting.

7.8 What can go wrong and how to deal with it

Withdrawal of a contractor

The withdrawal of a contractor may occur for different reasons, e.g. change of strategy, bankruptcy, etc. To be able to continue the project, all partners must give their approval for the withdrawal, and the Co-ordinator sends a written request to the Commisson. As long as there are no substantial effects on the project, the contract can continue. Steps to be taken can be:

  • the defaulting partner can be replaced by one of the other partners, for example, another end user within the same field

  • a new partner has to be found, due to the key role of the defaulting partner, either technically or in the strategic framing of the consortium, e.g, balance among countries, not less than 3 SME members, vertical integration, requirement of end users, etc.

The constitution of the consortium must be amended in the Consortium Agreement.

Decision on modification of the work plan

There might be several reasons why the work plan should be modified. Common reasons are:

  • the technical results, compared to the objective set up in the work package

  • changes in the economic or the social environment

A suitable moment to discuss such matters is the mid-term review, to which the Project Officer will be invited. The new work package shall be approved by the representative of the Commission as well as by all partners in the project. The Co-ordinator shall contact the Commission and send a copy of the new work package for approval.

Decision on terminating the project

Several circumstances may lead to a decision on terminating the project, e.g. default of key participants, technical results too far behind the objectives, external events, etc. The issue should be put on the agenda at one of the meetings and the decision shall be made by all participants following the decision procedure defined in the Consortium Agreement.

The termination of the project may also be decided by the Commission, under certain circumstances. The Commission will in this case also decide upon the financial consequences of the termination of the project.