According to Project Management Institute’s 2017 “Pulse of the Profession” global survey, organizations are wasting $97 million for every $1 billion invested due to poor project performance. Yes, that’s a 20 percent decline from the previous year’s survey, but the truth is, projects still fail at a staggering rate.
What are the primary high-level reasons for project failures? Since 2006, the PMI has conducted an annual global survey of project management practitioners to chart current and future trends for project management. The survey highlights feedback and insights from project, program, and portfolio managers, along with an analysis of third-party data, and it sheds clear light on what it takes to succeed as a project manager today.
PMI defines two types of performers when it comes to success rates: champions and underperformers, which achieve the following percent averages:
|Original goals/business intent met||92%||33%|
|Experience scope creep||24%||68%|
|Budget losses due to failed projects||14%||46%|
|Benefits realization maturity||High||Low|
Not surprisingly, champions generally achieve higher project success rates of 92 percent, when compared to the 33 percent of underperformers.
In the past, project-level factors received more focus when projects failed. Often ignoring or missing the fact that project success or failure rates were greatly driven by higher-level organization-wide factors. These high-level factors made it virtually impossible for project professionals to achieve project goals when both were either not in alignment or absent.
The following seven steps are key to ensuring on-time, on-budget and goal-based project delivery; company and project leadership should be in sync in all of these areas if they are intent on creating the sustainable results stakeholders desire.
1. Align company-wide strategic goals through an EPMO
Consider strategy the roadmap that should drive all company initiatives. Without this, teams across organizations risk flying blind, which in turn, risks long-term objectives. As a result, more companies are embracing the need for an enterprise-wide project management office (EPMO). The EPMO is a centralized strategic business-level function aimed at providing company-wide support on issues like governance, best practices, training, mentoring, identify and adopting techniques/ tools, and standardizing business processes.
PMI says, “Among organizations in our survey that have a PMO, half report having an enterprise-wide project management office (EPMO). And those that align their EPMO to strategy (i.e., have a strategic EPMO), report 38 percent more projects meet original goals and business intent and 33 percent fewer projects are deemed failures.”
2. Practice benefits realization management
Along the lines of company-wide strategy and the EPMO, comes the importance of identifying, executing and sustaining a benefits realization plan.
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