Doomed projects waste money and resources, divert attention from good projects, and undercut future projects by sowing seeds of doubt about organizational competence.
Bad projects can be defined by having several characteristics. They may fail to meet the original purpose, goal, or objective. They may fail to deliver the expected benefits. They may not satisfy the customer and/or other important stakeholders. They may fail to meet the schedule, scope, and cost targets.
Unfortunately, statistics about the likelihood of a project going bad are all too easy to come by. The PMI’s 2017 Pulse of the Profession Report finds that only 38% of the project outcomes met the original goals and business intent, met the original budget, and met the original schedule.
Pulse Report also estimates that $97M is wasted for every $1B spent on bad projects; that’s equivalent to 10% of the project budget.
Consider how many more good projects could be funded and the positive impact on organizational goals and corporate bottom lines if only a fraction of that wasted money could be redirected.
Why can’t organisations kill projects that are clearly doomed Projects?
Projects begin and end based on decisions commonly made by individual managers, management boards and committees, or a management hierarchy. It is important never to underestimate the influence of organisational politics on project selection.
Senior executives frequently promote dubious projects because the outcome will benefit their personal profile and not the organisation's overall health. A greater emphasis, scrutiny, and focus on front end selection criteria and downstream benefits realization will help alleviate such behaviour.
Other behaviours that come into play when working to understand why bad projects are so hard to kill include sunk cost, groupthink, escalation of commitment, and conflict of interest.
At some level, in accountable project cultures, increasing project investments (a sunk cost), building consensus (groupthink), doubling down (escalating of commitment), and narrowing one’s focus (conflicts of interest) are seen as acceptable behaviours.
Avoid being victimized by bad projects
Senior executives are often the originators of bad projects.
Bad projects abound; 1/3 or more of projects are bad.
Bad projects feel like a death march.
Bad projects derail a project manager’s career.
Avoid the Four Behaviours
Four excessive behaviours that can have negative consequences:
Sunk cost throws good money after bad.
Groupthink results in the course of action no one wanted.
Escalation of commitment doubles down on a failing course of action
Conflicts of interest promote self-serving action over rational acts.
Understand the Impact
Four values that are compromised by the four excessive behaviours:
Responsibility: take ownership of our decisions, actions, and consequences.
Respect: show high regard for ourselves, others, and resources entrusted to us.
Fairness: make decisions and act impartially and objectively.
Honesty: understand the truth and act truthfully.
Undermining ethical values undermines, trust, leadership, and project success.
The desire for the project manager to be accountable for the project outcome, for the well-being of the project team members, for customer and other stakeholder satisfaction, and for delivering the business benefits, can overshadow the reality of a bad project and make it hard to kill.
This article is an edited version of Why Bad Projects are so Hard to Kill by Michael O’Brochta published by PM World Journal Vol. VI, Issue III – March 2017 www.pmworldjournal.net