Doomed projects: Here's why they still go on

(Image source: Geek & Poke)

In this article, we talk about the reasons, severity, and ways to prevent bad projects. But before, let’s understand what is a doomed project.

A project fails if it has limitations in managing its triple constraints - scope, time, and cost. Failing to meet any of these affects the project quality. It is the project manager who identifies these projects and takes the right decision to avoid loss.


Triple Constraints

Image Source: Project smart

Let's take a look at few statistics to understand the seriousness of this issue:

  • As per PMI (Project Management Institute): An average large-scale IT projects run 40% over budget. About 7% of them are not completed within the given schedule with a delivery value of at least 50% of the expectation.

  • Geneva surveyed 600 U.S. business and IT professionals. The results show that almost 75% of the respondents lacked confidence in project success.

  • As per research published in Harvard Business Review, one out of six IT projects suffer from cost overrun. They examined 1,471 IT projects and found a cost overrun of 200% in one of the six projects.

  • Also, about 36% of projects fail to meet their goals. (PMI: Pulse of the Profession 2015)

These statistics remind us that there are many problems and challenges within any project. 

So, what are those challenges faced by organizations while dealing with projects? 

  • Noncompliance with the project on its scope results in financial loss to the organization.  It affects the credibility, product portfolio, and company’s goals in the long run.

  • The engagement of employees on such projects will incur a huge loss and affects the team’s morale. This may result in an increase in employee attrition.

  • Every failed project affects the growth of an organization in the short or long term.

failed projects - cartoon

Image Credits: Geek & Poke

Why doomed projects still go on?

The following are few reasons why they go on:

  • Certain projects have a high opportunity cost associated with them. Hence,  the project sponsor prefers to keep them alive rather than terminating them.

  • Many of the government projects are not meant to earn any profit. This makes the sponsors reluctant to understand the current project status. Alas! they ask the project team to finish the work at all costs.

  • Backing out of certain projects can become a prestige issue for many companies. Thus, they keep these projects alive and running at all costs.

  • If a project is being carried out for a customer with a fixed contract, it finishes only as per the contract terms. Even though it might not be profitable.

  • In bigger projects, the decision-making takes a lot of time. Hence, the projects continue until an official order is sent to terminate them.

How can you avoid bad projects?

  1. A project’s success lies in the accuracy of its feasibility report and planning. It's the project manager's role to provide inputs in the planning stage. He prepares the plan with the help of his project team members.

    A project feasibility plan may include the following details:

    • Understanding the project and its requirements.

    • Description of the project or the product.

    • General requirements of the project.

    • Special requirements like GMP (Good Manufacturing Practice), Regulatory, Environmental Health, and Safety, etc.

    • Current price and profit level of the project.

    • Budget Plan of the project.

    • Project timeline and the milestones.

    • High-level risks are likely to show up during the project development.

    • The assumption was made during the reporting.

  2.  Set up ground rules at the very beginning of the project. With these rules in place, the efficiency of the team improves.  To understand the importance of setting up of ground rule, here's an example below -

    Suppose, in a project 'ABC' the team agreed to have weekly project updates and implemented it well. But, a team member from the quality department seldom attended any meetings. Whenever he did, he was not updated with the progress or changes in the project. So the project suffered from quality issues and thus a delay in the project delivery.

    In the above example, it is the project manager who accounts for this delay. This wouldn't have happened if the project manager had set strong ground rules in the team.

  3. To estimate the quality of a project, certain parameters must be set in each phase or milestone. While setting up these parameters, expert judgment and key skills are important.
    The following techniques help in setting up the parameters-

    • Group discussion with the team.

    • Subject Matter Expert’s inputs.

    • A workshop on the key parameters.

    • One should track these at every milestone. He should judge the quality of the project and decide the next set of actions as per the plan.

  4. In large projects, there are many dependent deliverables. The project manager should monitor and communicate the exact status of the project with the team. Thus, a project manager should be a good communicator ensuring everybody is on the same page.

  5. Studying and implementing changes in the project is a challenging task. The change control board must check each request against the scope, cost, and timeline before implementing any change.

  6. Lastly, amongst the common reasons as to why organizations keep dragging doomed projects and end with a huge loss, is the lack of good project management practices. A project manager must know when to approach the sponsors and when to terminate the project. This step must be process-driven and guidelines must be set in the project planning phase itself. 

Thus with a good project manager, who is capable of taking care of all the above factors, an organization can avoid project failures. 

Generally, PMP certified Project manager takes an upper hand compared to a General Project Manager because:

  • A PMP-certified official is aware of all the tools and techniques used in different projects.

  • PMP certification gives you more convincing power than an ordinary project manager.

  • PMP certification helps you to face challenging projects and to ace them.

Get Certified Now!

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Sandeep Patil