When a project has failed to deliver on its promises, it’s important to look at the hard data behind the project and the people working on it if lessons are to be learned from the mistakes made and those mistakes are not repeated.
All business analysts and project managers know that the only way to progress and have more project success in the future, is to learn from the mistakes of the past. But knowing and doing in the heat of a complex project and, moreover, one that is not going to plan, are two different things.
But if you want a reminder of how things can go wrong if you don’t learn from mistakes then take a look at some key project management statistics from 2015 gathered by Wrike.
The statistics are based on figures from the US, but still provide some important lessons when it comes to the global project management approach by leading organisations. Some of these statistics may shock you, some may not surprise you, but hopefully at the very least they will give you some insight into what might have gone wrong or be going wrong with your projects, and help you understand how you can move forward and gain success.
“Only 64% of projects meet their goals.”
If you have a high percentage of projects that fail, is it time for you or your employees to get review your methodology or strategy?
“70% of companies report having at least one failed project in the last year.”
One failed project might not seem like that much of a problem, unless of course it was the one with the biggest budget, or the one for the most important client…
“Organisations lose $109 million for every $1 billion invested in projects and programs. “
That’s a lot of money, but there’s still profit being made which is the most important thing. If your percentages are much closer together, it’s time to reconsider your approach – money matters.
“High-performing organisations successfully complete 89% of projects, while low performers only complete 36% successfully. Low performers waste nearly 12 times more resources than high-performing organisations.”
This is direct evidence that high performance = a high level of resourcefulness. Strategies for resourcefulness can be learnt so you should be constantly learning and adopting new approaches to analysis and projects as market conditions change.
“Only one-third of companies always prepare a business case for new projects.”
Writing a business case is a crucial component when it comes to project success. If this is something you are regularly not doing, it’s time to rethink your strategy as your projects could be doomed to failure from the very beginning just because this one component is missing. Without a solid business case how can the requirements be defined and, more importantly, be controlled. A lack of a business case is one of the reasons for problematic scope creep.
“60% of companies don’t measure ROI on projects.”
Businesses are businesses to make money. ROI quantifies the project value.
“Average Project Success Rates:
39% of all projects succeed (delivered on time, on budget, and with required features and functions)
43% are challenged (late, over budget, and/or with fewer than the required features and functions) 18% fail (either cancelled prior to completion or delivered and never used).
Average % of features delivered – 69%
Average cost overrun – 59%
Average time overrun – 74%
Small Projects (less than $1 million) vs. Large Projects (more than $10 million)
|Small Projects (less than $1 million)||Large Projects (more than $10 million)|
|76% are successfully||10% are successful|
|20% are challenged||52% are challenged|
|4% fail||38% fail|
The bigger risk takers tend to enjoy the bigger wins, although there is obviously a lot more at stake and the losses will be considerable. However, it is possible to take measured risks, especially when you’re using a truly sound risk management strategy that aims to identify, monitor and control all known risks. It is, unfortunately, often the unknown risks that can bring a project to the point of collapse.
“Large projects are twice as likely to be late, over budget, and missing critical features than small projects. A large project is more than 10 times more likely to fail outright, meaning it will be cancelled or will not be used because it outlived its usefulness prior to implementation. “
The most important thing to remember when it comes to large and/or complex projects, is that communication and a sound strategy and vision are shared by all of those involved in the project from the most junior team member to the most senior executive right from the outset. Large or complex projects are clearly more difficult to manage and their size and complexity means they are less likely to succeed.
Most Common Causes of Project Failure:
- Changing priorities within organisation – 40%
- Inaccurate requirements – 38%
- Change in project objectives – 35%
- Undefined risks/opportunities – 30%
- Poor communication – 30%
- Undefined project goals – 30%
- Inadequate sponsor support – 29%
- Inadequate cost estimates – 29%
- Inaccurate task time estimate – 27%
- Resource dependency – 25%
- Poor change management – 25%
- Inadequate resource forecasting – 23%
- Inexperienced project manager – 20%
- Limited resources – 20%
- Procrastination within team – 13%
- Task dependency – 11%
- Other – 9%
This is proof indeed that there are is a whole host of components that need to be actively managed and controlled in order to help the project succeed.
“Despite being the top driver of project success, fewer than 2 in 3 projects had actively engaged project sponsors.”
This is of key importance when it comes to project success. Project sponsors, where possible, should be an active part of the team. Project managers should have excellent communication with the project sponsors, and manage them just like they manage the team. The sponsors should also have regular updates and fully understand their roles and responsibilities in relation to the project. Unfortunately, especially on long projects, sponsors get re-assigned to other projects, never totally engage in the project or simply lose interest as the project drags on.
All statistics and information in bold was taken from the WRIKE complete collection of project management statistics 2015.