Projects still remain the vehicle for executing on strategy. Even if the current pressures facing executives around strategy are ignored, and assuming strategy remains unchanged, project failure rates will continue to remain alarmingly high if there is no clear unified vision for execution.
Only 29 percent of projects were completed successfully in 2015, according to project goals and parameters – a rate unchanged since 2004. Failed investments add up to $2 trillion of the $3 trillion spent annually on projects. In order to get a handle on this, project management has attempted to address this with process-oriented measurements rather than results-oriented.
Is getting some projects completed that follows the process really the goal? Instead, consider why many projects fail in the first place?
Poor project sponsorship or management is often cited as the number one reason a project fails. Why are you doing projects that don’t have sponsorship to begin with? Are they not a priority? If they aren’t a priority, then why are you doing them?
The answer? Stop doing projects that aren’t a priority or were not created from a strategic vision. Begin with strong leaders who have a unified vision to keep planning and prioritization on track. Consider this: only about 52% of corporations reported using a coherent project prioritization strategy, according to a 2014 PMI survey.
Clearly, line-of-business executives need to engage with every department involved at each project stage to understand the implications of any changes made to business processes. They are the difference between a successful or a failed initiative. Once you establish the projects that are the priorities of the organization to deliver its strategy, you have a baseline. Then, leverage continuous planning to incorporate new information against established baselines. Leaders can ensure flexibility if priorities change while maintaining project buy-in. Where do you begin to establish your baseline? Consider these four questions:
- Where is the organization heading and where are the gaps and/or opportunities?
- What projects do we need to undertake to expand or to support existing capabilities that will achieve our strategies?
- What’s our budget and capacity?
- When do we need to do them?
Once these questions are answered, you can ensure that your portfolio baseline closely aligns with your company’s strategic vision. You should be careful not to let day-to-day tasks derail any project that aligns well with your established strategy. Also, remember that business plans and baselines are necessary, but they are not meant to be inflexible. Inevitably, learning how to respond and adjust to new information will help you create a more agile culture and gain better team buy-in.
When it comes to project prioritization, companies need to be nimble and responsive. For tips on how you can do this, I invite you to watch this on-demand webcast, “The Impact of Project Prioritisation.” You’ll hear from Russell Stewart, capital and improvement manager at Graincorp, on how they are improving their project prioritization.