The Big Question
Why projects fail in spite of the best PM techniques 

The project management discipline has made huge inroads in the business environment and PMI has over 200,000 members, but we all have heard stories of huge projects that fail, even with good project managers in place.  Often, with lessons learned true lack of good sponsorship can be accountable for most failures.  The role of a sponsor is key in shepherding and negotiating key issues to resolution along with the program manager.

However, the harsh reality that most senior project managers eventually face is that the successful project management techniques do not work in certain circumstances.  When a project is cancelled, or a program manager is replaced, he is faced with important self-assessing questions:  “What happened, even though I did all the right things”.  “What should I have done differently”?  We’ve all also heard stories of companies who espouse project management, but have functional managers saying things like:  “Just pick a date and make the team deliver.”  Or “The MS Project tool is getting in your way.  Just use a task list.”  Sometimes, we have even been in the board room explaining issues and constraints only to be told “You need to think positively.  That is how this project will get done.”  These are the times when a good project manager feels like no one really knows what he/she is talking about, and starts considering a career change.

When you are doing everything right, and things still fail to progress or succeed, what is the real cause?  The project manager is considered responsible for lack of progress or a project failure.  This is demoralizing at best, and can be career-limiting.  Most good project managers are well versed in escalation, communication skills, negotiation and all the things necessary to make a project succeed.  Failure regardless of these efforts can often be attributed to other corporate issues such as the following:

·        Senior management that doesn’t understand strategy.  Surprisingly, this is often the case.   When strategy is unclear, projects can suffer from indecision or poor decisions.

o       Unqualified individuals promoted.  In many companies, people are promoted due to longevity, tenacity, or the ability to prove how other people have failed.  They are often promoted simply because they have been there longer, or are better known, not necessarily because they are qualified to do the job.  Thus, a company can end up with senior managers who do not understand basic competitive analysis or how high level goals need to be supported by lower level tactical efforts.  In fact, one project manager tells of sessions where a senior management team argued about what is an objective vs a tactic or strategy.  This can cause corporate strategic direction to be ambiguous or to fluctuate frequently.  .  In another company, a senior manager said “replacing our computer system is our strategy”.  “Once I know how much budget I have, then I can tell you my strategy”.  This was a bit backwards.  Another director-level individual quipped “Finance drives strategy”.  Any MBA can tell you that in fact, strategy is to be determined first, and then the financial resources available determines what part of that strategy you can execute.

o       No clear strategic direction.  This issue is very much related to the one above because individuals who do not understand basic elements of strategy cannot lead well.  However this could also be caused by unusual competitive pressures like the surprise success of a competitor’s product.  One publisher faced a popular series of books coming to market by a competitor.  In this case, the publisher scrambled to put out their own series, dropping or postponing on-going works in favor of responding to the competitive environment.  Also, an entire business segment can be in flux such as the dot coms of the 1980s.  Choosing technology options was hard when the choices changed so quickly, or when companies were acquired.  Initial technical direction of projects was often re-directed.

o       Failure to commit sufficient resources.  Many companies do not commit dedicated subject matter experts, or fund projects with only the best case scenario without any reserve.  This shows a lack of strategic importance for a project.  With human resources, other business pressures can work to undermine a project, when its strategic value is not clear.  This can result in the re-direction or substitution of staff, when functional areas have a crisis.  Best-case scenario project funding – (this can mean expecting overtime from resources at the outset, failing to recognize productivity curves with new staff, eliminating vacation time and the like) - can undo the planning efforts of even the most senior project manager.  A company that fails to recognize variance and change is inevitable sets itself up for project failures.

o       Failure to measure correctly.   One company I worked with had the goal of superior customer service.  This was great, and was included on everyone’s performance goals for the year.  However, there was no articulation of how to deliver customer service.  In fact, one programmer had customer satisfaction on his goals to be measured by call center satisfactions surveys.  There was no direct correlation between the programmer’s work and the call center’s performance.  At another company the corporate motto was essentially the “golden rule.”  However, nothing was done to sanction managers who were egregiously violating it.  For a project manager, this is often done through the banner of a company wanting good project management, but failing to support the very things needed to achieve it, like common practices, appropriate timing of progress evaluations, and identification and mitigation of risks, and appropriate financial progress reporting beyond simple burn-rate.  Poor measurements of projects can lead to poor strategic planning decisions. 

·        Confidential Organizational Changes Pending.  More and more frequently there are high level organizational changes going on that cannot be communicated, forcing lack of forward motion.  Events like the following can affect management’s ability to make a clear decision:

o       An acquisition.  These are obviously confidential, and often key project decisions are postponed awaiting the outcome of a particular bid.

o       A downsizing:  At one company I originally had a 2M budget, and projects defined within it.  My budget was cut to 200K and I was told to do all the projects anyway.  Additionally, in a downsizing environment you may face staff cuts that don’t get communicated until the last minute.

o       A major restructuring:  Often with changes in any C-level position, be it corporate or SBU, senior management begins to scramble, and the grab for department “real estate” begins.  This can derail important decision making for project issues as well.

o       Poor budget “trade-offs” – in one case the travel budget for senior management was over spent, so project and training travel for the workers was curtailed, thus the projects suffer, and the project manager is blamed when the project has issues.

o       Poorly designed management incentives.  In one case a CIO had an incentive to come in under budget by 4% in order to receive a $50K bonus.  He slashed the entire IT budget across the board by 4%, disregarding contractual obligations, and other project constraints.  Projects suffered unnecessarily, and some did not deliver.  This incentive was not designed to require quality delivery too.  However, his bonus was paid.

o       Budgetary “shell” games – Without proper portfolio oversight, projects may be started and not completed, or shelved to save money.  Individual departments may make decisions that are good for them, but bad for the larger project.

·        Personal Fear / Culture that doesn’t allow for error.  These are the types of issues that just make you scratch your head and wonder.  This type of issue is the worst of them, since the reasons are often not rational.

o       Political issues and vested interest to not be wrong can immobilize functional managers from good decision making.  At one major company “the business” chose a software package without much IT support.  The marketing spin for the product was good; however it turned out to be “vapor ware”.  Nonetheless, the business held fast to the decision, spending millions on a product that would not work, despite clear evidence to the contrary.

o       Existing management doesn’t really know the answer, and your project is pointing out their weakness.  This may cause delays, resistance, and other things that simply don’t make sense.  One manager had 7 meetings on defining the use of a simple industry term.  The team finally came to consensus.  A day later another manager revisited the definition again.  There were enough varying understandings of the term that no one wanted to take responsibility and push for a clear definition and use.

o       Appearance of support for project issue escalation, but failure to actually call a project “red”.   Fear of a red status can be because corporate culture does not allow it.  Often teams will talk themselves out of a difficult status, so it does not have to be explained.  The truth is, as we all know, you can still successfully deliver a project in red status, as long as senior management understands and accepts the risks and consequences. 

However, when the consequences end up badly, the acceptance is often forgotten, even if it is documented.  The point of making it red is to declare the issues, and if it is important enough, senior management should muster the resources to resolve the issue, or cancel the project.  This often highlights a problem with a particular functional group, and becomes a blame game, instead of a problem solving method.

How do you avoid environments like these?   Much of the project management discipline is designed to ensure good communication and appropriate action on blocks to the project’s success. But in companies with the issues listed above, it just cannot work.  

One alternative is to turn down projects not positioned for success.   While this is not an easy option, it is far better than walking into a disaster.  The warning signs in an interview are pretty clear:

• Undefined roles – “We aren’t really sure how we want this position to work, you’ll have to sell the role”
• Undefined budget – “don’t worry about that” or  “it will be taken care of”
• Unrealistic expectations:  One global project was estimated for 6 months.  Based on prior experience the project manager interviewing knew it to be at least a year long effort.

Another alternative is to negotiate up front making acceptance of the project or program management job conditional on specific project management processes and requirements, and reporting structure.

These two work well for contractors, or consulting jobs, but what can an employee do?  The sad truth is that most program and project management positions are not senior enough in an organization.  One must have positional power to influence the general corporate direction with regard to education on strategy.  Only senior management is “in the know” on major corporate changes (and thereby not being held accountable for non-delivery).  And generally only C-level positions are in a position to influence appropriate management incentives.  The employee of a company with characteristics like those described here may be better off looking for a new company.  A project manager can try to wait out corporate change, but will likely encounter a lot of resistance, and may eventually be blamed for failures out of his control.  He may be constantly fighting an uphill battle just to do his job effectively.  If senior management doesn’t have the understanding to change corporate culture, put forth appropriate management incentives, or major corporate changes are on the horizon, there isn’t much even the most senior program manager can do.  Without positional power, even a senior program manager does not have enough sway to override corporate culture.

So if you have had one of these awful experiences, or have been in a company that is not yet mature in project management,  a common reaction can be to get out of project management altogether and do something else.  However, knowing that others have these same issues, and that it is not your lack of skill can help make a failure seem less personal.  There are companies with good environments and good project management support.  The trick is to find one that means what it says.   Try a few of the following suggestions to find a company with a good corporate culture and environment supportive of project management: 

• Ask people who have worked there, and some who still do.  With six degrees of separation, you will probably know someone who knows someone, if you do not yourself.
• What is the tenure of most people at the company?  If you are looking at 20 to 30 years, it may not be a culture open to change.
• How long has the company had a Project Management Office?  Have they tried several times?  If it is new, then the company may not be ready for good project management techniques.
• Do they advertise the same project management jobs over and over?  This may show a problem.  If the company cannot keep project management positions filled, you may want to investigate.  It could be growth, or it could be a sign of a bigger problem.
• What is the company’s reputation in town, in the country?  Are they even on the list of best companies to work for?
• If you are looking at a small company, be aware that resources are very tight, and management is often the owner.  This can have its own drawbacks.

We hear that a large number of projects fail.  We also know that not all project managers are inept.  Certification and continuing education has raised the bar in awareness of the discipline.  However, many functional managers still do not embrace good project management techniques, and can be resistant.  Managers unfamiliar with good project management will often throw out the entire discipline in favor of “winging it” out of frustration with the process.  It is a difficult path we have chosen.  The techniques do work.  Some circumstances and corporate environments just do not allow us to do our jobs.