3 Reasons Why Projects Fail and How to Avoid Them

Last Updated May 3, 2019

Projects that aren’t executed properly can be destined for failure. Numerous studies have backed this claim in a variety of industries and sectors. Consider these two examples:

• A 2012 McKinsey and Company study found that large IT projects ran 45% over budget and 7% over time, and delivered 56% less value than expected.
• A 2010 KPMG study found that 70% of companies experienced at least one project failure in the prior 12 months.

Fortunately, by avoiding common pitfalls, project managers can help eliminate errors and lead a project toward successful completion. Here are three common examples of pitfalls, and how to correct them to help ensure project success.

Poor Risk Management Practices

In general, it’s acceptable for businesses to take some degree of risk in order to achieve objectives. The challenge is to identify, assess and prioritize different types of risks so they can be anticipated and managed in a way that reduces the organization’s vulnerability.

Reactive risk management is one aspect of project management, but the rigor with which it’s typically undertaken can be minor. It can also result in unanticipated problems with project execution, causing missed deadlines and milestones, budget overruns, excessive staff overtime and frequent burnout.

Instead of addressing problems reactively, consider approaching them proactively. Proactive risk management identifies the risks associated with the scope, schedule and cost of the project and integrates the entire project management team in the process. A risk management plan is another way to educate the project team on the benefits and risks of a certain undertaking, and may help limit common pitfalls that could derail projects.

Scope Creep Planning Failure

It can happen in a flash: The project scope that has carefully outlined the parameters of a project quickly morphs into an uncontrollable mess, dooming effective execution. Many factors can cause scope creep:

• The initial requirements analysis was poorly done
• End users weren’t brought into the project’s planning early enough
• The project was oversimplified
• Change control was lacking and communication among stakeholders was poor

Fortunately, scope creep can be managed. It starts by ensuring that everyone involved in the project are on the same page with the vision and priorities, from budget and deadlines to features and satisfaction.

Next, it’s important to identify deliverables and to ensure they’re broken down as work requirements. The more detailed the deliverables, the better, particularly for the bigger projects that often have an abundance of moving parts. It may also be beneficial to factor in time for software upgrades and documentation.

A project schedule that reflects the work requirements and breaks down the project by milestones should then be developed and approved by project heads. It’s usually recommended to slightly overestimate the duration of the project, because finishing under budget and ahead of schedule can give project teams flexibility to add enhancements.

Once created, resources should be assigned and critical path determined through a Project Evaluation and Review Technique (PERT) chart or creating a structure for the work to be done. Even though the path may change over the life of the project, it should be evaluated and followed to help ensure deliverables are completed on schedule.

Scope creep may still occur to some degree, but these steps can help keep it manageable.

Failure to Communicate

All too often, communications between project managers and project drivers and stakeholders break down once teams get into the thick of the work. It’s also common for the failure to be recognized at the most inconvenient stage, when the impact on costs, schedules and scope is at its highest and resolving issues disrupts project workflow.

One way to avoid this pitfall is by developing a communications management plan that covers project and stakeholder communications and is followed from the outset of the project.  It can also be beneficial to undertake a stakeholder analysis that uncovers expectations and communication needs. Project managers should be ready to regularly offer up project updates through various information delivery channels that meet the diverse needs of stakeholders.

Overcoming Pitfalls

In today’s business world, projects of various types and complexity are critical to help businesses deal with the push and pull of expanding investment demand and constrained capacity. Business goals and objectives count on projects being executed right and in a timely manner. Being aware of common project pitfalls and how to navigate around them can help ensure your company doesn’t fall victim to project failure.