Years ago I had an interview for what would have been my first “pure” project management job. The interviewers asked me what I would do if the customer claimed something had gone wrong in my project and requested compensation. I said I would estimate the damages we had caused. I did not get the job.
I would have regarded this an isolated mistake I have once made due to lack of maturity if I haven’t seen other colleagues make the same mistake. It is one example why a project manager who works on customer projects needs business skills.
Many companies proclaim customer is above all and some of them may really believe it. We as project managers are naturally inclined to do the best work for the customer. This can be a two-edged sword though. For example when the customer complains that the project goes too slow we may be tempted to add people to the team which would increase project costs for our company.
Why is it wrong for a project manager to be too open for customer wants? The shortest and blunt answer is that there is no free lunch. A more sophisticated answer is that there should always be balance of power between customer and provider. Customer protects their interests. If you as a project manager do the same, who will then stand for the company which pays your salary? Your boss?
In addition, when you give more to the customer than they are entitled to, they tend to expect even more in the future. The bad practice of over delivering which is also known as “gold plating” can easily trigger a snowball effect that is very hard to counteract.
This explains why we as project managers should protect customer interests but not at the cost of our company.