Why do Projects Fail ?
Top 5 Reasons
In a competitive environment, business leaders are constantly devising and launching new intricate projects, so as to maintain their edge over their competitors. However, many projects, that started with a great vision, fail in the end. There are many reasons for project failures. They provide valuable lessons to understand why projects fail and how to avoid these pitfalls in future projects.
1. No Real Value Creation
Many projects start as big lofty ideas from the leadership. While these projects may make economic sense, the leadership team may have tunnel vision in focusing excessively on the outcome. These ideas eventually become their pet projects. Losing focus on their main business strategy, business leaders may then overcommit themselves to projects, that not only require excessive amount of resources, but also do not create significant value for the business.
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2. Frequent Change of Project Scope
Too many captains will sink the ship, as the saying goes. Many big projects start when leaders think that there is a need for major changes to turn around the business. While many business leaders can contribute many ideas and 'wish-lists', the project itself does not have clear leadership and governance. Hence the project scope keeps morphing with new ideas and concepts.
Moreover, the project execution with all the ongoing changes in scope is pushed down to the line managers. Not only the latter have not been involved right from the start, but they also face issues like lack of understanding of the whole project and resistance to change. Eventually, too many changes to the project scope as well as the lack of experienced and dedicated resources for the execution of the project will be the final nails in the coffin.
3. No Buy-In from Key Stake Holders
Successful project delivery encompasses not only good teamwork, but also great stakeholder management. One key stakeholder is the leadership team. Without the active support and buy-in of the leadership, the project will face hurdles in its implementation, but also resistance to change within the organisation.
There are many other stakeholders within a project and can involve both internal as well as external parties. Team members within the organisation, who are directly involved in the project as well as other employees, who will be affected by the changes brought about, need to be fully engaged. External parties, like third party technology service providers, managed service providers, suppliers, clients and others, need to be also involved, where necessary, so that the project is delivered smoothly.
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4. Lack of Dedicated Key Resources
The pressure to meet very tight deadlines as well as to deliver the project within budget can be overwhelming. Signs, that things are not running well, may be overlooked. Project leaders can be overstretched with limited resources and relationship among team members can start to fray and affect the project. Other potential risks can arise when the project leader is too over-confident on his/her abilities and ostracises key resources; thereby affecting the team spirit. The project delivery can be affected and eventually fail.
5. Project Risks Not Fully Assessed & Identified
During project delivery, the environment within the project team and beyond is very dynamic. There can be many unforeseen circumstances/reasons that can suddenly stall a project. Hence, even if all major risks have been assessed and identified at the start of the project, risk management is a constant exercise to ensure that the project is being rolled out smoothly. Projects risks are continually identified and mitigated well before they become major issues to deal with.
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