Project failures are hardly a unique phenomenon. In fact, most projects are far more likely to fail than to succeed.
It’s a well-established maxim that a project delivery has a high failure rate. The statistics bear it out and would make even the most committed optimise wince: just over one third of IT projects are delivered on time (and in scope and budget) and one in six have an average cost overrun of 200% and 70% schedule overrun. The real kicker is that 75% of business and IT executives expect their projects to fail and that they are ‘doomed from the start’.
As COVID and the impact on business shifted many teams into hybrid or remote work, many organisations have reported that the shift has had some real benefits for their business projects despite a crisis unlike anything we’ve seen in recent memory. Their teams got focused on what was critical for projects and the teams running them to succeed.
However, for many other organisations, the speed and scale of change exposed deep organisational issues around collaborative work, communication, and ensuring that people within delivery teams understand the context for their contribution and work.
COVID or not, the reasons projects fail are actually very well established.
1) The Poorly Understood Business Case
Failing to understand the ‘why’ behind the ‘what’ results in projects delivering outcomes that don’t meet the real needs of an organisation. It’s a failure resulting from not asking “What are we really trying to achieve?”
Ambiguity and lack of clarity around the business benefits result from poorly communicated vision around a project. Failing to document the “why” of the project often results in its objectives becoming misaligned with business strategy goals and the strategic vision of the business overall.
Unfortunately, it is also not uncommon for a project to define its vision and goals and then become shelf ware rather than a guide for subsequent decision making and measurement of success.
2) Unsupported Project Management Culture
We see many organisations that simply do not ‘get’ Project Management, resulting in a fundamental top-down misunderstanding of what Project Management is and the value it brings.
This can lead to inexperienced and/or untrained individuals running projects with little management support and missed opportunities to upskill a team for better project outcomes.
3) Scope Creep
It is one of the most recurring themes in project failures and if you look at any recent research, changing requirements – or scope creep – is cited as a common reason for derailing a project. There are few surprises as to why, with the typical culprits including:
- Lack of formality in the scope definition process within the team
- Vague or open-ended requirements (such as requirements that end with “etc.”)
- Failure to execute change control once the project is in flight
- Requirements are defined by an intermediary, not the business
- Individual requirements are never vetted against the project’s overall objectives
In Quay’s experience, if your team are more than 15% into a project and its scope is not clear, it’s unlikely that it will get back on track which makes clear requirements gathering an essential exercise.
4) Lack of Effective Leadership
Leadership across all levels of a project is vital for its success and for the companies that have soared during COVID, it is the ability of the leadership team to navigate through its challenges and support their people through the uncertainty that delivered success.
It is critical for executive-level sponsorship to be robust and engaged for a project to be set up for success. Without it, projects can and will drift. Good sponsors are accountable for the change that they are delivering into the business.
Having a solid grounding in BAU isn’t enough: Clarity around ownership, context, engagement and decision-making is essential, and if you’re bringing first-time sponsors into the mix, they need to be backed with an experienced Program/Project Manager to help guide them through the project fundamentals.
We often say that a fish rots from the head. If the leadership team isn’t displaying the focus, behaviours, or supporting the culture required for success, it is easy for the rot to set in and derail not only projects but the environment in which they are being delivered.
5) The Accidental Project Manager
We see this all too often: the accidental project manager who gets tapped to lead a project based on their SME knowledge or technical expertise.
The evolution from BAU to project manager is a steep learning curve of leadership, business strategy, people skills and knowing the project fundamentals that are required for successful project outcomes.
The Accidental Project Manager has no choice but to learn the key fundamentals in project delivery … and fast. Unfortunately, project management is a very undervalued discipline and all too often, business leaders don’t recognise the impact that adding ‘project manager’ to a BAU role can place considerable pressure on their people if it doesn’t come with a corresponding allowance for disruption or focus for both.
6) Poor Monitoring & Controls
“On time and on budget” are key ingredients of successfully delivering projects. However, rather surprisingly, few projects are properly baselined and then subsequently monitored.
If an ‘accidental project manager’ is unable to or does not know how to accurately build a schedule, monitor and report on the actual effort/duration against the planned effort/duration then there is no effective way to understand what and when corrective actions (if any) are required. And there is no way to report or manage upwards to keep expectations clear.
7) Unreliable Estimates
Accurately estimating a project’s effort is difficult. It requires experienced SMEs who are familiar with the work required and ideally will be part of the team responsible for delivering it. A significant contributor to project failure occurs when estimation is based on insufficient information or analysis and provided by the wrong people, or time and effort are cut to fit budget or time constraints.
All are major contributors to failure by creating time and cost commitments, and the subsequent setting of stakeholder expectations, that simply are, and never were, realistic.
8) No Risk Management
Every project carries a degree of unpredictability and, therefore, risk. One of the most effective ways to increase a project’s likelihood of success is to reduce the issues around predictability by employing a risk management strategy from the outset. Too few projects assess risk adequately and instead treat it as a cursory one-off exercise – and that’s if they do it at all.
It’s critical that a targeted and relevant (not generic) risk log is established at the beginning of the project and then maintained on a regular basis once the project is underway.
9) Not Delivering What the Business Needs
Poor stakeholder management and engagement is a common mistake in project failures. Identifying and engaging the right stakeholders is essential for success and without their input, a solution may be delivered that does not meet needs or expectations of the key customer. Worse, it may make their life more difficult rather than delivering the expected benefits.
10) Underestimating Project Management impacts with BAU
One of the biggest complaints from project managers is that BAU resources that are supposedly allocated on a project are also trying to juggle many other commitments at the same time (this can include the PM themselves).
Competing demands from other projects/BAU activities can have massive impacts on project productivity as project estimates are often underestimated or do not consider these ‘other’ commitments and distractions when projects are in the planning stage.
Furthermore ‘’Context Switching’’ (where someone is involved in multiple projects) can also lead to as much as an 80% loss in productivity:
- 1 project: 100% working time available per project
- 2 projects: 40% working time available per project. 20% lost to context switching
- 3 projects: 20% working time available per project. 40% lost to context switching
- 4 projects: 10% working time available per project. 60% lost to context switching
- 5 projects: 5% working time available per project. 75% lost to context switching
Failure is an orphan
While the list above is far from exhaustive, it certainly provides some insight as to why projects fail. As it is often said, success has many fathers, but failure is an orphan.
When a project fails, we would argue that there is a whole lot of sub-standard co-parenting going on with many of the above culprits being present.
Contact us here to find out more about how we work with your teams or call 02 9098 6300.
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