04 August 2020

Project Management: Redefining Projects' Success I

Mismanagement

A project is typically considered as successful if has met the beforehand defined objectives within the allocated budget, timeframe and expected quality levels. Any negative deviation from any of these equates with a project failure. In other words, the success or failure of a project is judged as black or white with no grays in between, which is utopic, especially for mid to big software projects, typically associated with lot of uncertainty. According to this definition a project which had a delay of a few months, or the budget was overrun by 10%, or the users got only 90% from the planned functionality, or any combination of these negative deviations, can be considered as failed.

If a small project needed 6 instead of 3 months to complete, which is normal for projects with reduced priority, as long the project costs haven’t changed, then the increase in duration can be ignored. In exchange, 3 months of a delay for a 2 years project is normal, especially when the project is complex. Even if additional costs incurred within this timeframe, as long they are a small percentage in comparison with the overall project costs, then the impact can be acceptable for the business. On the other side, when the delays have an exponential growth with further implications, then the problem changes dramatically.

Big projects have typically a strategic importance. It’s the case of ERP implementations, which besides the technology changes have in theory have the potential to transform an organization pushing it to reach further performance levels. Such projects are estimated to take on average one to two years for a medium organization, however the delays can easily reach 50% to 100% from the initial estimation. Independently of what caused the delay, as long the organization achieved the intended goals and can cover project’s costs, one can say that the project made a (positive) difference.

Independently of project’s size, if 90% of the important functionality is available, then more likely the 10% can be covered in a first step with manual work, following in time to further invest into the system as part of a continuous improvement process. It’s maybe not ideal for the users, however the approach incorporates also the learning curve of working with the system and understanding ist possibilities and limitations. Of course, when the percentage of the available functionality decreases below a given limit, system’s acceptance is endangered, which users eventually start looking for alternatives.

There are also projects which opened the door to new possibilities and which require more investments to leverage the full capabilities. Some ERP implementations have this potential, despite overruns. Some of such investments are entitled while others are not. Related to this last category, there are projects which are on time, on budget, and the deliverables satisfy the quality criteria and objectives, however they make no difference for the organization despite the important investments made. Sure, some of the projects from this category are a must (e.g. updates, upgrade, technology changes), however there are also projects which can be considered as self-occupational hazard. In extremis such projects run in the background and cost organizations lot of energy and resources, while their effects are questionable.

At least from these examples the definition of a project's success needs to be changed or maybe standardized to consider not only intrinsic but also extrinsic aspects. In theory, that is the role of a Project Management Office (PMO), however it’s challenging to find an evaluation methodology that fits all needs. Further on, from same considerations, benchmarking projects across organizations and industries can prove to be a foolhardy attempt.
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