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Why do projects fail?Is a project a failure because it went over budget? Because it did not deliver the expected benefits? Is a project considered a success when it is on time, on budget and to the expected quality – but the end user is not interested in it? How much power does a project manager really have to prevent project failure?
Representatives of three very different industries look at the main causes of project failure in their environment.
Humphrey Maliavusa (HM) is a contract supervisor working on maintenance and capital expansion projects in the utilities sector.
Lissa Stewart (LS) is project manager PMP, PRINCE2 Practitioner for Business Connexion, Durban in KwaZulu-Natal.
She works on projects that supply ‘connective intelligence’ in application systems and application integration.
Denise Kilbourn (DK) is a PRINCE2 practitioner and project manager in the property development environment, working mainly on housing projects – particularly in the lower and middle income group market (Financial Services Charter Market). She also has vast experience on projects that cater for the top income groups i.e. golf and lifestyle estates.
How do you define a failed project in your environment?
HM: The word ‘‘failure’’ describes the condition or fact of not achieving the expected end results. Project failure is a condition that exists when the project results have not been delivered as was expected. However, if the project results are acceptable to the user, then overrun of costs and schedule may be tolerated.
LS: A project is defined a failure when the business benefits have not been realised.
DK: There are many and varied reasons why projects can and do fail, and it is also difficult to say exactly WHEN a specific project has ‘failed’. But as a project manager, I would say that one has failed if the project has not been delivered on time and within the agreed budget due to mismanagement and not due to circumstances beyond your control. I believe that one must always look for the silver lining, and it is usually in the failed projects that we learn the most!
From your experience, what are the five main reasons why projects fail?
HM: Poor communication – we all know that communication is an essential critical success factor. But short of wiring everyone’s brains together, it is a very difficult objective to achieve in many organisational settings. If the project manager fails to communicate the status of the project to the team and sponsor, everyone thinks the project is going smoothly until the deadline is missed. The PM needs to tell people early if it is slipping. Do not hide it. By telling people that they are running late, it gives them the opportunity to help get it back on track.
Scope changes – scope is the overall view of what a system will deliver. The scope needs to be clearly defined and then a process put in place to ensure that change requests are formally approved. Scope is the insidious growth in the scale of a system during the life of a project. The scope of the project continues changing, so you never really have a fixed set of deliverables. Every time it changes, you lose time and resource, so change control is critical. Management must be realistic about what is it that it wants and when, and stick to it. This emphasises the advantages of shorter timescales and a phased approach to building systems, so that change has less chance to affect development.
Customer involvement – Lack of user involvement has proved fatal for many projects. Without user involvement, nobody in the business feels committed to a system, and can even be hostile to it. If a project is to be a success, senior management and users need to be involved from the start, and continuously throughout the development. This requires time and effort, and when the people in a business are already stretched, finding time for a new project is not high on their priority list. Therefore senior management needs to support the project continuously to make it clear to staff that it is a priority. Users must know what it is they want, and be able to specify it precisely.
Time frames – Long timescales for a project will lead to systems being delivered for products and services no longer in use by an organisation. The key recommendation is that project timescales should be short, which means that larger systems should be split into separate projects. There are always problems with this approach, but the benefits of doing so are considerable.
Many managers are well aware of the need for fast delivery, leading to the other problem of unrealistic timescales. These are set without considering the volume of work that needs to be done to ensure delivery. As a result, these systems are either delivered late or only have a fraction of the facilities that were asked for. The recommendation here is to review all project plans to see if they are realistic, and to challenge the participants to express any reservations they may have with it.
Impossible deadlines – The deadline for the project may be impossible to achieve. The project manager needs to explain to the sponsor at the start of the project and fight to have the deadline extended. The project does not only need to have sufficient time to be delivered, but also needs contingency plans in case things take longer than expected. Often, simply striving to meet deadlines compromises quality; thinking that later on we will get back and correct the solution provided. That ‘later on’ never comes because of new deadlines and the task in hand. These little compromises add up to the point of making the project difficult to manage and deadlines impossible to meet, leading to project failure.
LS: From experience, I would identify the following as the leading causes:
* Lack of communication between stakeholders;
* Lack of ownership and responsibility by stakeholders;
* Unsustainable risk management;
* Ineffective organisational change management; and
* Product benefits are out of date at the end of the project, from what was originally scoped at project initiation.
It is imperative to ensure that project management adds value to the organisation. As president of PMSA KZN, in the current turbulent economic environment, I am assisting our members to introduce resource optimisation techniques and cost savings; and to ensure that improved accountability and governance is achieved.
DK: As stated above, there are so many reasons why a project can fail and it will differ with each project – even if you do exactly the same thing. The property development environment is a volatile environment due to economic, political and environmental influences.
In my experience (and after conferring with experienced developers), the five main reasons for project failure are
the following:
* Insufficient research on the demand for specific housing in a specific area;
* Insufficient or no research on whether the landscape/environment is suitable for development, and whether this proposed development falls within the wishes and demands of the local/district government’s wishes;
* The availability and accessibility of funding/financing. Not only development finance but also end-user finance;
* The availability and cost of bulk services and the ability of the government (local/regional and national) to communicate this to the developers; and
* Lack of communication between relevant parties, stakeholders and team members.
In my opinion, managing a project is a ‘team sport’. The professionals (engineers, town planners, architects, lawyers etc.) need to communicate regularly, honestly and effectively.
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