Project management and organizational strategy should be a tight fit – but often are not. It would only seem natural that projects would be designed and managed based upon the reason they exist in the first place. Often it seems like ‘out of the box thinking’ to map project purpose back to organizational strategy and design metrics to support it.
The record of success on projects
Let’s look specifically at IT projects. The following are some disconcerting statistics on IT project success from a 2017 report from the Project Management Institute (PMI):
- 14 percent of IT projects failed completely
Of those that did not fall into the ‘failed completely’ group:
- 31 percent did not meet their goals
- 43 percent exceeded their initial budgets
- 49 percent were not on schedule
If you search for statistics on project failure, you will see lots of statistics – and it’s not a pretty picture. The statistics indicate that failure is more common than success.
Why do so many projects fail?
According to the ‘PMI Pulse of the Profession 2017’, “A lack of clear goals is the most common factor (37%) behind project failure, according to executive leaders.”
A workamajig.com blog post on ‘Project Management Performance Statistics‘ summarized the top five causes of project failure as:
- Change in the organization’s priorities (39%)
- Change in project objectives (37%)
- Inaccurate requirements gathering (35%)
- Inadequate vision (29%)
- Poor communication (29%)
Let’s take a closer look at the causes in these statistics.
The primary factor cited in the PMI study, “a lack of clear goals”, indicates a lack of tight mapping between project management and organizational strategy. That could be a failure to have a clear organizational strategy, or a failure to transfer the appropriate elements of that strategy to the project managers who will manage the projects, or shortcomings on the part of the project managers to clearly map project outcomes throughout the project phases to those original strategic goals.
Of the five bulleted factors listed above, change – in the organizations priorities and in project objectives – was a common theme and was in the top two. Organizational priorities and project objectives can will change. I think that acknowledging that things will change and managing priorities and situations with that in mind is the beginning of the solution to that problem.
The other top causes of project failure – inaccurate requirements gathering, inadequate vision, and poor communication – also have the potential to be handled better to cause a reduction in project failure.
- First, requirements gathering can be done in a more agile manner, allowing for rapid improvement cycles. Clarity of the strategic underpinnings of projects can also be improved, ensuring that the requirements are built upon the right input.
- Second, and inadequate vision is likely a direct result of an unclear strategy. Improvement can be made by ensuring that the strategy is clear before creating projects to support it.
- Third, while there are many ways that poor communication can derail a project, often the communication is poor between the strategy side and the implementation side. I think this can be improved by building bridges between the two sides, dissolving what I think is a sort of firewall between the two, and increasing transparency on both sides.
How can projects succeed more often?
I recommend these PM templates (paid link):
There are a number of things that can be done to manage the inevitability of change, such as:
- Define the strategy to an appropriate level of detail, and acknowledge uncertainty.
- Leave room for learning. Many projects can and should be created for the sole purpose of learning to provide more clarity for next steps before further investment.
- Make projects small enough that they can be completed and produce something of value in a short time frame.
I think that if things like this are done, some change that is the cause for project failure can be realized.
The key is to have clarity of strategy, and to create projects only that are aligned with the strategy. I believe that smaller is usually better, so define more fine-grained projects that address discrete elements of strategy can work well and increase chances of success. I also think that the ideas of ‘learning projects’, as mentioned above, can greatly increase the success rate. the key to having a successful learning project is to clearly define the purpose and desired question to be answered – the success criteria.
How can project managers improve their chances of success?
This whole strategic approach is not just an organizational effort; it is also very much a personal endeavor. The clearer the project manager can think in strategic terms, the more likely he/she will be to define the project well, measure progress toward goals, and even in some cases push back on a project because it lacks these things.
To do this, project managers need to tune in from the start on the strategic drivers of project success. They can no longer accept success criteria as simply related to schedule, cost, and quality. It can help to generally get more educated on strategic concepts. It also helps to build relationships with the C-level and managers within the organization that are devising and setting strategy. It will also help if they can advocate for more involvement in that process, as input from the implementation side is critical to the organization for overall success.
More than ever, it is critically important that organizations align their implementation with their strategy.
- Having a good and well communicated strategy
- Includes bridging the gap between strategy and implementation, measuring implementation and project success with metrics that are based on strategic attributes, and ensuring that the people – the strategists and the project managers – are in close communication
- ‘Cross fertilization’ within the organization by finding ways to develop a stronger appreciation by strategists of the implementation side, and helping project managers develop a stronger understanding of the strategic drivers at play
I recommend these strategy resources (paid link):