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What is a Project Sponsor?

Smartpedia: A Project Sponsor is a person or institution that supports a project out of interest – usually with financial means.

Project Sponsor – a stakeholder with a special interest in a project

A sponsor is a person or a group of persons, a body or an institution that promotes “something” in order to achieve a goal. If the “something” is a project, it is called a Project Sponsor; the activity carried out by a Project Sponsor is accordingly called “Project Sponsorship”. Alternatively, the “something” could also be a campaign – e.g. the election of a political party – or a development – e.g. the promotion of alternative energy sources by a government – or an organisation – e.g. a shirt sponsorship at a sports club.

In a narrower sense, project sponsoring includes the provision or procurement of funds for the implementation of a project, but in a broader sense it can also be an activity that, for example, allocates personnel in sufficient capacity, creates target-oriented parameters for the successful implementation of a project or supports the project manager through coaching. Either way, a Project Sponsor is a stakeholder with a special interest in the project.

Tasks and roles of Project Sponsors

There are a number of terms or synonyms used instead of Project Sponsor: Guarantor, promoter, benefactor, donor, financier, funder, investor, or patron.  In some publications, the Project Sponsor is equated with the project client, which can occur in project practice, but does not have to be so (e.g. there could be one project client and several Project Sponsors). This brief mention of alternative terms alone shows that the term Project Sponsor is not clearly defined. Consequently, for organisations this means that the roles and tasks of a Project Sponsor can differ. Here is a list of exemplary tasks and roles:

  • As a investor, he provides needed financial resources. How the funds are calculated, whether it is a one-off or a regular event, or what rights and obligations go along with it, must be discussed individually. The investor itself could be external (e.g. a client or a partner company) or internal (e.g. a technical department, a division or department management, the PMO or management).
  • As a financier, he ensures the provision of financial resources. For example, they could acquire additional funds or donors during the course of a project.
  • As patron, he could help with capacity building (or funding), making decisions, communicating with other stakeholders or escalating problems. The higher the prestige (or position in the hierarchy of a company) the easier it is to implement the work of a patron.
  • As a donor he could support a project financially, as a benefactor “by opening doors”, e.g. by providing contacts or access to partner networks.
  • As a coach or mentor, the Project Sponsor could support the project manager or project team, act as a sounding board, assist with risk assessment, help plan releases or conduct retrospectives.

In short, the role of the Project Sponsor or the activity of Project Sponsoring is manifold. And it often overlaps with existing roles and activities within an organisation.

Importance of Project Sponsorship

Lack of management commitment is often cited as a key reason for project failure. Theoretically, project sponsoring could help here, because those who invest time and money in a project have an interest in the success of the project and will therefore attentively try to remove possible obstacles from the project path. In practice, however, this is not always the case, because often project sponsors

  • Project Sponsors support several projects at the same time, so that they cannot devote enough time to a specific project,
  • investments made disappear from the radar of the Project Sponsors (out of sight, out of mind),
  • projects compete with each other for financial and human resources, especially if they have different significance for the company’s success, strategy or image.
  • not all challenges can be mastered despite existing financial or personnel capacities.

Active and sustainable project sponsoring can therefore be a sensible response to the lack of commitment on the part of management, but it does not have to be.

Tips for Project Sponsorship

There are a number of tips for effective Project Sponsorship:

  • Take ownership. If you sponsor a project, invest time and money, and coach employees, you should also take responsibility and ownership.
  • Avoid micromanagement. In many organisations, the Project Sponsor does not take an active role in the actual implementation of the project, he does not develop anything, he does not take project or product increments and he does not release project phases or budgets. Accordingly, he should not micromanage, but concentrate on his defined role and task.
  • Accelerate decisions. If the Project Sponsor sits on the PMO or the steering board, for example, it is a good idea for him to exert his influence on the organisation and/or stakeholders in order to make good decisions quickly.
  • Strike a balance. As a supporter and promoter of a project, the sponsor should see himself as a friend on the one hand and a critic of the project on the other. Here it is important to find a “healthy balance” in terms of the desired project goal and success.
  • Pay attention to priorities. In many organisations, numerous projects take place in parallel. Of course, the sponsor should focus on his project, but it makes sense to consider the defined priorities between the projects.
  • Invest time and heart and soul. Commitment is important. Being available as a contact person when needed is also important. And supporting a project wholeheartedly can move mountains.

It is interesting that these tips can also be used as recommendations for leadership.

Project Sponsor - the promotion of a project by a person or institution

Impulse to discuss:

When does it make sense to officially designate Project Sponsors inside or outside an organisation?

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