What “Champions” Do Differently to Achieve Better Project Results
By Mark A. Langley, President and CEO, Project Management Institute
In early February, PMI released its 2017 Pulse of the Profession®: Success Rates Rise: Transforming the high cost of low performance, an annual global study of project, program and portfolio managers that charts the major trends in project management.
The latest research came with noteworthy results regarding the increasing maturity levels of global organisations in relation to project management — and figures that demonstrate organisations worldwide are recognising the importance of implementing this type of framework to improve efficiency and decrease wasteful spending.
In fact, the survey showed that organisations are experiencing more success with implementation of their strategic initiatives. For the first time in five years, the percentage of projects meeting original goals and business intent and being completed within budget has increased. In addition, organisations are wasting 20 percent less money compared to a year ago — an average of 97 million Euros for every one billion invested, the lowest number we have seen since we began tracking this metric in 2006.
This is good news for organisations worldwide that are eager to align strategy with intended benefit. When organisations begin to undertake a project or program, they typically do so with a clear mission: to add value, advance strategies and increase competitive advantage. The more organisations use an appropriate project management framework, the more likely it is that they will achieve project success.
At the same time, the definition of success is evolving. The traditional measures of scope, time, and cost are no longer sufficient in today’s competitive environment. The ability of projects to deliver what they set out to do — the expected benefits — is just as important. So, for the first time, when determining project success, Pulse research looked at levels of benefits realisation maturity as well as the traditional measures. Through this wider lens, we identified two new performance levels among responding organisations — “champions” and “underperformers”.
“Champions” are organisations with 80 percent or more of projects being completed on time and on budget, and meeting original goals and business intent — while also having high benefits realisation maturity. “Underperformers” are organisations with 60 percent or fewer projects being completed on time and on budget, and meeting original goals and business intent — while having low benefits realisation maturity.
As expected, champions have higher project success rates (92 percent versus 33 percent of underperformers) and enjoy more successful business outcomes. Champions waste significantly less money due to poor project performance. These findings suggest that organisations are becoming more mature with their project management practices and are investing in several factors that distinguish more successful project performance.
One of those factors is talent. Organisations continue to pay focus on talent development, specifically the technical, leadership and business skills required for the management of projects. Thirty-two percent of survey respondents consider both technical and leadership skills a high priority—a 3 percent increase over last year; specifically, champions prioritise the development of technical skills (76 percent versus 19 percent of underperformers), leadership skills (76 percent versus 16 percent of underperformers), and strategic and business management skills (65 percent versus 14 percent of
underperformers). Having the talent to implement a company’s initiatives successfully is the critical capability that gives organisations a competitive advantage to navigate through necessary change. Excellence in managing that talent is a key differentiator to fully realizing that capability.
Another factor that distinguishes champion organizations is their attention to benefits realisation management as a powerful way to align projects, programs, and portfolios to an organisation’s overarching strategy. The discipline has intimidated many, because there is no single, widely accepted Benefits Realization Management process; despite that, more organisations are establishing procedures for identifying benefits and monitoring progress toward achieving and sustaining them. According to PMI’s research, 31 percent of organisations reported high Benefits Realization Management maturity.
Champions are also distinguished by the establishment of Project Management Offices (PMOs) and strategic Enterprise Project Management Offices (EPMOs) to bridge the gap between high-level strategic vision and implementation. The strategic role of the PMO and EPMO is vital. That role often includes responsibility for aligning the project portfolio to strategy, monitoring progress and optimising delivery of strategy, navigating risk, driving benefits realisation, enhancing governance and accountability, and managing talent.
Champions recognize the strategic importance of the PMO—81 percent have a PMO, compared to 59 percent of underperformers. Additionally, 56 percent of champions have their EPMO highly aligned to the organization’s strategy, compared to just 12 percent of underperformers.
Another factor that makes champions successful relates to executive sponsorship. PMI’s research consistently shows that an actively engaged executive sponsor is the top driver of projects meeting their original goals and business intent. So the fact that organizations report more projects—62 percent this year compared to 59 percent in 2016—are using executive sponsors suggests project success rates may continue to rise. The best executive sponsors have detailed knowledge of a project and how it connects to business strategy. More than three-quarters of projects at champion organisations have actively engaged sponsors (77 percent versus 44 percent of underperformers).
A fifth factor that defines champions is their focus on using agile approaches to projects. Fifty-five percent of champions use agile, versus 24 percent of underperformers. A full 71 percent of organisations report that they sometimes use agile approaches to their projects. In the last year, one in five projects has used agile approaches; another one in five has used hybrid or blended approaches.
The growing focus on talent management, benefits realization management, the use of PMOs and EPMOs, executive sponsorship, and agile among champion organisations demonstrates that organisations are recognizing the critical connection between project implementation and business success. Organisations around the world can follow the lead of champion organisations to increase their ability to implement strategic initiatives and achieve their missions.
