If you’ve experienced project failure, you’re hardly alone – in fact, most projects are more likely to fail than succeed.

It’s a well-established industry maxim that a high rate of projects will fail. The statistics from IT project failures would possibly make even the most ardent optimist wince, given that 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’.

So, why is it that so many IT projects fail to achieve their time, quality and budget promises?

From our research here are our Top 10 Reasons that projects fail.

1) 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

We know from experience that if you’re 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.

2) Lack of Effective Leadership

Leadership across all levels of a project is vital for its success. If the fish does indeed rot from the head, then it is critical for executive-level sponsorship to set a project up for success – without it, projects can and will drift.

Good sponsors are accountable for the change that they are delivering into the business and they will carefully choose the best team for the gig.

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 a team that understands project fundamentals.

3) 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.

4) The Accidental Project Manager

Pity the Accidental Project Manager who often gets tapped to lead a project based on their SME knowledge and technical expertise. The evolution from ‘techie’ to project manager is a steep learning curve of leadership, business strategy, people skills and learning the project fundamentals that are required for successful projects.

The Accidental Project Manager will need to learn the quickest way to eat an elephant is by understanding the basics of elephant anatomy first, and that is equally true in understanding the key fundamentals in project delivery.

5) Poor Monitoring & Controls

“On time and on budget” is a key ingredient of successfully delivering projects. Surprisingly few projects are properly baselined and are then subsequently monitored.

If a Project Manager is unable 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.

6) 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 responsible for delivering it.

A significant contributor to project failure occurs when estimation is based on insufficient information or analysis and done by the wrong people, or time and effort is 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.

7) 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.

8) 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 results 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.

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 deliver 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.

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Want to talk to us about project fundamentals? Contact us here or call 02 9098 6300.

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Quay Consulting
Quay Consulting is a professional services business specialising in the project landscape, transforming strategy into fit-for-purpose delivery. Meet our team ...