Almost everyone project manager that I meet wants to find out a way to do two things:
- Deliver their projects on-budget and on-time
- Be innovative in their approach while doing so
Yet, we know that most projects are neither on-budget nor on-time. The bigger and more critical the project, the more likely that it will over-run budgets and get delayed. So, why is it that most large projects fail? Is there anything that we can do to address this statistic?
My belief is that most projects fail (over-budget or delayed) because of three primary reason:
- Adopting a Deliberate strategy
- Collaboration breakdown
- Known Cognitive biases
In this post, I would like to delve a bit deeper to understand one of these reasons and how to address it.
Adopting a deliberate strategy:
Most projects are planned using a deliberate strategy approach. Someone prepares a project plan, based on the plan, someone decides what resources will be needed and how much time will it take. Based on this the team decides and agrees on a budget. Everyone adds a little bit of a buffer at each layer, so that they can cover any cost over-runs or delays.
This buffer is added at each layer because everyone in the process knows that irrespective of how good the plan is, when we start executing, something will have changed. A vendor might go out of business. There might be a new technological advance. Key employees leave the company or are out on maternity/paternity leave. Basically, things change and this change will have an impact on the project deliverables. Everyone anticipates how big this change might be (based on their past experience) and accordingly adds a buffer to the plan.
If this change is substantial or important enough, it will get addressed at a project level and will lead to a change in the project deliverables. If not, this will need to be absorbed at the local level. Each one of these changes adds up and creates a ripple effect which leads to cost over-runs and delays.
So, the question then to ask is the following:
Is there a different way to plan and execute projects?
I believe there is. The difference in the strategy used for planning and measuring progress. I am suggesting to move from a deliberate strategy to an emergent strategy. What this means is that instead of having a fixed plan and a fixed target (Budget/Time-frame) for the entire project at the outset, we move to a smaller plan and a smaller target (budget/time) for a smaller part of the project (with an overall ballpark figure earmarked for the project, but not committed).
This means that the budget and time is discussed and approved at every delivery stage. This means we look at the current situation and plan for the next delivery due date and plan only for the next step. At fixed intervals the entire leadership team comes back to discuss the following:
Is this project still a priority?
Are we making good progress? If yes, Agree on the next major milestone and approve resources that are needed. If not, deep dive into the reasons why not? Then deal with the reasons so that the team can make good progress on the project.
Does it make sense to stop working on this project and reassign the resources to a different project? If yes, conduct an analysis on what did we learn from the project. Find out if there is a way to salvage or re-use what we have already created as part of the project in any way possible?
If it still makes sense to continue to work on the project, decide if we need to use the same team or re-organise the resources and reset the expectations from the project.
This strategy is intensive in terms of the fact that it requires the management teams to make go/no go decisions not based on the progress of the project but based on the criticality of the project. Once it is decided that the project is still critical for the organisation, they can then decide the next course of action till the next review process.
This form of review allows the organisation to re-align resources where it best deployed based on the current reality. As we know reality can change really fast and thus this process of review allows the teams to realign to new reality faster. Just because a project was initiated and funded doesn’t mean that it needs to be completed. If it doesn’t make sense any longer, we just stop working on it.
The only thing we need to be careful here is to not react to every market situation and stop or continue a project. At the start of the project, we need to have decided the reason why a project was approved. We also need to clearly define the criteria when we can safely assume that the project is no longer strategic and needs to be culled. This needs to happen before the project is started. More on how to make good decisions on my blog here.
By moving from a deliberate to an emergent strategy, we create a system where all projects are reviewed in a manner that every project that we continue to work and invest on, is still strategic and relevant and for no other reason. This strategy also creates an additional benefit of keeping the overall planned budget of the project lower and the speed of execution faster.
This post first appeared on the PMI Bangalore newsletter and has been republished here with permission.