Over 50% of projects fail.
Alright, let’s make this quick - I know this hurts. As a profession we still fail far too often. Project failure is a major source of waste and frustration in most organizations. Here are a few interesting nuggets of information:
Only 37% of organizations deliver projects on time more often than not. In other words, 63% of organizations deliver more than 50% of their projects late! (UK data, Source: Wellingtone)
The number of projects that are lost hook, line and sinker (“Failed project, budget lost”) has stubbornly remained above 30% for the last 6 years. (Source: PMI Pulse of the Profession 2017)
85% of organizations have a PMO (Source: State of the PMO, 2016)... but given that most organizations can’t even deliver half their projects on time
The most common factor (37%) behind project failure is a lack of clear goals (or even a lack of alignment to corporate goals - source: PMI Pulse of the Profession 2017)
Okay, everybody talks about the importance of the strategic alignment of your project portfolio. Your portfolio exists to support your business strategy but in this blog, I want to look at things the other way around. Let’s assume we’ve already aligned our portfolio to strategy - what benefits would we see?
In this blog I often talk about the project prioritization process and the best method of implementing it. In this article I would like to share some ideas on how to use the prioritization matrix to prioritize projects in a way that gives you a chance to succeed.
Okay, so you may have read our ultimate guide to project prioritization and now you want to know how to prioritize projects. You’re in the right place.
We’ll break it down into 4 easy steps.
Let’s get one thing clear before we start. Your projects are not “your” projects, they are there to deliver strategic value to the business. It is, therefore, vital to make sure that “the business” - for the purpose of this blog, that means a diverse group of senior stakeholders - what “value” means before you start.
This process begins with a brainstorming session with your executives. The goal of this brainstorming is to end up with a list of 4 to 7 top-level strategic goals - the business goals that are most important to your stakeholders. We will then use those goals as criteria to evaluate and score your projects - this is what allows you to deliver strategic alignment.
Your top-level criteria can be further divided into sub-goals. You might end up with something like this:
So, you've probably heard the one about the broken pencil?
....nah, there's no point.
Maybe that's really a joke about PMOs. You've seen the stats, right?
I've written before on ways to turn this around, but there's one underlying challenge: many PMO leaders themselves don't understand the point of the PMO. If the PMO leader doesn't know what the PMO is for, how can the senior executives value it?
There is a revolution under way: the 4th Industrial Revolution.
And the PMO is, in some ways, the most crucial player in making this revolution happen. The PMO is like Napoleon. Or the guillotine. The revolution just wouldn't have played out without them.
Change is nothing new and it's a cliché to say that change is accelerating, but it really is. It's not just accelerating, but it's accelerating on a whole lot of different fronts all at once. Technologies like artificial intelligence, internet of things, robotics, big data and - well, just throw in your favourite collection of buzz-words - these technologies are driving change at a faster pace than ever before. And this accelerated change has a name; the 4th Industrial Revolution.
And the PMO is a key player in this revolution, but are you ready?
PMOs are like insects...
"Okay, Stuart, you've lost it this time...!"
But wait - hear me out.
Between certain species of ants and aphids, something magical happens. They cooperate to help each other thrive - they have a symbiotic relationship. The aphids "mine" plants for sugar which they "feed" to the ants. The ants, for their part, protect the aphids from predators, even destroying Ladybird (Ladybug if you don't speak the Queen's English) eggs to prevent those predators from being born.
PMOs and Executives are just like that though I'm not saying which is which.
And he took the rather controversial position that PMOs should NOT be in the business of prioritizing demand.
Have you ever seen any superhero sequel movie without an upgrade? Of course not! Superheroes come back with new gear to combat threats and to SAVE THE WORLD.
This is what PMOs need - an upgrade to fight PROJECT FAILURE. Like any good super villain, project failure is hard to eradicate (in fact, may never be totally vanquished). And like any good super villain, project failure can be fatal, not just to projects, but also to careers.
PMI’s recent survey is absolutely clear – too much money is being wasted on poor project performance. No, don’t roll your eyes. We’ve all heard this message so often it’s kind of become background noise, but think about it. If your company decided to build a new $200m headquarters building then changed its mind and had to lay off 10% of the workforce because of the wasted money, you’d be furious, right?
I have no alternative; you’re fired!
Projects that fail, especially significant projects that promise the moon but that end up costing the earth, can end your career in a heartbeat. Of course projects fail for all kinds of reasons, but one very common cause is picking the wrong project/vendor/partners/solution in the first place.
On July 13th, 1985, a group of musicians including David Bowie, Queen and The Who came together and changed the world. It was called Live Aid and was attended by around 170,000 people in the UK and the USA and was watched by one-and-a-half billion people around the world. Live Aid raised something like £150m (that's around $200m at today's exchange rate) for famine relief in Africa.
Now, come on! We in the PM community are not going to let a bunch of over-paid poppinjays with bad haircuts have all the glory, are we?
PMs, PMOs, consultants, vendors... we can all make a difference, we can change the world, and here's how.
In their massive rock anthem, We Are The Champions, the band Queen boldly declare, “No time for losers, ‘cos we are the champions…”
Perhaps this goes some way to explaining why 72% of PMOs are being called into question by their executives; perhaps they too have “No time for losers…”
And today, we’re going to figure out where you sit. Are you a Champion or an Underperformer? Or, most likely, somewhere in between?
Search for ‘project failure statistics’ and you’ll find lots of reports talking about failure rates of anywhere between 40% and 75%. It’s also easy to find training providers and consultants who tout the one guaranteed way to project success.
But just what do we mean by project failure or success? Before we can really start to talk about improving success rates, surely we need to understand this. I host a community of PMO professionals in Melbourne – we call this community P3C – and we recently discussed just this point.
This blog looks at what we learned.