It is still a common practice to not kill non-productive projects. Managers must be aware of these excuses and be careful not to overload their organization in 2019.
I was reminded by the Harvard Business Review article on root causes of project overload why organisations lose money. My own research has shown that too many projects are a major cause of money loss. It may seem obvious that there is an immediate solution to the problem of limited resources. Simply put some of your projects on hold. This doesn’t require expensive consultancy or special tools. In practice, project professionals are assigned more projects. This leads to overloaded employees and reduced output.
Robert Cooper is a thought leader in innovation. Companies in North America, Europe and Asia have implemented his discoveries, including 3M and ABB, BASF, Bosch-Siemens and Caterpillar. Dr. Cooper and his associates have examined the main reasons organisations keep doomed project alive. Let’s see if these excuses for not killing projects still hold true by comparing them with the current situation in project management.
#1 You must get anything to market
Sometimes, C-level management needs to rush to get something to market. Partially, this urgency is driven partly by the product’s life cycle. Levitt described this phenomenon in 1965. The product life cycle has become shorter over time as more people are driven to bring new products to market.
#2 Sunk Cost Reasoning
If you have invested a lot of time and money on a project, it can be difficult to end it. Do you really want to lose even more money? Companies have difficulty cutting their losses. Research published in Psychology and Aging (2016) found that younger employees are more likely to stick with a failing project plan.
#3 “We’ve Almost Found The Way!” ”
Sometimes projects can get stuck on technical issues. To recognize the signs of project failure early and to end a project without further loss of resources and time, it takes maturity. In Wellingtone’s 2018 survey, more than half of respondents expressed dissatisfaction about the maturity of their company’s project portfolio management. According to Wellingtone’s 2018 survey, the level dissatisfaction rose from 45% to 56% in 2016 to 56% by 2018.
#4 CEO’s “Pet” Projects
These are the projects that senior management is most committed to. Pet projects often have poor track records and high failure rate. Rose Hollister, Michael D. Watkins and Michael D. Watkins write in the Harvard Business Review that project overload is caused by adding projects to a portfolio without adequate funding and staffing.
#5 No Better Projects in The Portfolio
A lack of great product ideas is a sign that there is poor alignment between the business objectives and the programs and projects the company brings in. Only 41% of companies with an enterprise-wide project manager office report high alignment with their strategy.
#6 No Mechanism to Kill Projects
Many companies lack a mechanism that can justify ending a project. Project management tools should show real-time KPIs to detect early signs of project failure. Only 22% of companies use a project management or resource management software solution to track real time KPIs. Harvard Business Review article cited above supports this claim, stating that companies lack the tools and mechanisms to manage and measure the load within their organisation.
#7: Poor Portfolio Management
Companies are missing a high-level overview on all projects in their portfolio if they don’t have portfolio management. The market is full of project management tools today, but there are many organizational options.