LONDON--()--Project and programme failure can have serious consequences. A new study announced today by The Project Management Institute (PMI) found that UK organisations risk on average £169 million for every £1 billion spent—higher than the £135 million for every £1 billion risked by companies that make up the global average. However, research also shows that high-performing organisations that implement proven success measures mitigate risk by improving their project and programme outcomes; 90 percent of their projects are meeting original goals and business intent (compared to 36% success rate for low performing organisations), and they risk 14 times less than their low-performing counterparts, creating a significant competitive advantage.
“When organisations continue getting better at executing their projects and programmes, they drive success. But when executives undervalue the benefit of effective project, programme and portfolio management—strategic initiative management—they put real money, and their futures, at risk.”
“These findings should concern executives, particularly in today’s complex business landscape,” said PMI President and CEO Mark A. Langley, who unveiled the Pulse of the Profession findings today at a meeting attended by high-level project and programme executives from leading UK organisations. “When organisations continue getting better at executing their projects and programmes, they drive success. But when executives undervalue the benefit of effective project, programme and portfolio management—strategic initiative management—they put real money, and their futures, at risk.”
Risk looms for many organisations. According to the 2013 Pulse of the Profession, 59 percent of organisations in the UK understand the value of project management, slightly higher than in the global sample. Compared to the average, UK companies demonstrate a more robust approach to project management, with 54 percent of UK respondents reporting that their organisation has a formal process for developing project manager competency compared to 45 percent globally. Slightly more than half of UK companies also have a defined career path for those engaged in project or programme management, compared to 42 percent globally.
Even so, project success rates are declining, with fewer than two-thirds of projects meeting their original goals or business intent – a significant decline since 2010. Conversely, the number of projects experiencing scope creep globally has risen from 41 percent in 2010 to 45 percent today. In effect, across the globe, projects are becoming less successful and more expensive.
Though PMI’s Pulse of the Profession survey uncovered these declines, however, it also revealed positive movement in the strategic application of project management practices and alignment with an organisation’s broader business goals. More than three-quarters of project managers (76 percent) say their projects are better aligned to organisational strategy today than they were a year ago.
In this complex environment, aligning with overall organisational strategy and understanding what it takes to become a high performer – completing 80 percent or more of projects on time, on budget and within goals – has the potential to improve an organisation's outcomes. The Pulse finds that organisations looking to become high performers are significantly more likely to focus on three key factors:
- Talent management. High-performing organisations provide consistent, continuous training and development for project managers to enhance organisational success. They are significantly more likely than low performers to provide a defined career path for project managers, a process to develop project management competency and training on the use of project management tools and techniques.
- Standardisation. Standardization leads to an efficient use of resources, which allows more time and resources to focus on leading, innovating and delivering products and services—and ultimately leads to a competitive advantage. High performing organisations are almost three times more likely than low-performing organisations (36 percent vs. 13 percent) to use standardized practices throughout the organisation, and have better project outcomes as a result.
- Strategic Alignment. High-performing organisations are at least four times more likely than low-performing organisations to have achieved maturity in their project management practices. The Pulse data show clearly that more mature project, programme and portfolio management practices lead to better project performance. Organisations with successful project management practices, integrated benefits realization processes, and aligned portfolio management capabilities along with high organisational agility all have significantly better project outcomes than their counterparts who are less advanced.
To access PMI's Pulse of the Profession™ please visit www.pmi.org/pulse.
About the Pulse of the Profession/Methodology
Conducted since 2006, PMI's Pulse of the Profession™ is the annual global survey of project management professionals. The Pulse of the Profession charts the major trends for project management now and in the future. It features original market research that reports feedback and insights from project, programme and portfolio managers, along with an analysis of third-party data. The newest edition of the Pulse features feedback and insights from nearly 800 project management leaders and practitioners across North America, Asia Pacific, Europe, the Middle East, Africa (EMEA) and Latin America and Caribbean regions.
About Project Management Institute (PMI)
PMI is the one of the world's largest not-for-profit membership association for the project management profession. Our professional resources and research empower more than 700,000 members, credential holders and volunteers in nearly every country in the world to enhance their careers, improve their organisations' success and further mature the profession.
PMI's worldwide advocacy for project management is reinforced by our globally recognized standards and certification programme, extensive academic and market research programmes, chapters and communities of practice, and professional development opportunities.