For the first time in five years, more projects are meeting original goals and business intent and are being completed within budget, according to PMI's 2017 Pulse of the Profession report.
Since 2006 the Project Management Institute (PMI) has conducted a survey of business leaders and project management professionals and then compiled a report that offers valuable insight into the state of project, portfolio, and program management. PMI recently published its 2017 Pulse of the Profession Report (PDF), which noted an increase in project success rates in 2016.
In the report, PMI identifies two types of performance levels encountered within the surveyed 3,234 global project management practitioners and leaders from various industries: champions and underperformers.
- Champions: When companies can boast that they have been able to complete projects within scope and meet intended business goals 80% of the time, they can be categorized as champions.
- Underperformers: When companies complete projects within scope and only meet the intended business goals less than 60% of the time, they can be categorized as underperformers. These companies typically can only meet with success 33% of the time.
SEE: 10 best practices for successful project management (TechRepublic download)
Key factors in successful projects
Each year many business leaders and project management professionals struggle with high project failure rates and may be at a loss for isolating the true reasons behind what went wrong. Hopefully, you can avoid analyzing project failures by learning from successful projects. Here are the top five factors for project success in 2016, according to the PMI report.
1: Reduce waste
PMI says for every $1 billion invested, companies waste an average of $97 million as a result of dismal project performance—this is approximately 20% less than a year ago.
In 2016, businesses categorized as champions experienced significantly less waste. Benefits realization maturity levels were high in champion organizations, and overall these companies typically enjoyed success rates 92% of the time and wasted almost 28X less money as a result.
2: Improve strategic business alignment
The report found companies that restructured their project management offices (PMOs) as strategic enterprise-wide project management offices (EPMOs) to align all project, portfolio, and program management initiatives with company-wide goals have seen 38% more of their projects meeting with overall business intent. Further, their failure rates were 33% less. The big win for businesses came as a result of a large shift in companies seeing and utilizing project management as a "strategic competency for success."
3: Improve sponsorship
Actively engaged and supportive sponsorship was also found to play a pivotal role in driving success rates from 59% to 62% in 2016. Interestingly, surveyed C-suites also note "bridging strategy formulation and execution and tackling technology and business disruption" as remaining a top priority and focus. Customer relations and operational efficiency was also mentioned as critical for at least the next few years.
4: Increase in training and talent investment
Also contributing to the uptick in project success rates within champion organizations was technical skills development training increasing by 57%, leadership skills increasing by 60%, and strategic and business management increasing by 51%.
5: Increase in agile adoption
The report also highlighted that "71 percent of organizations now reporting they use agile approaches to their projects sometimes or more frequently than in the past." Within the last year, many companies confirmed they use agile methodologies in at least 20% of projects, and an additional 20% of businesses employed a hybrid methodology of some sort.
SEE: Agile project management: The smart person's guide (TechRepublic)
Read PMI's entire report
PMI's 2017 Pulse of the Profession report offers clear insight into some of the winning ingredients that go into increasing project, program, portfolio, and business success, and is well worth the read. As companies continue to solidify the connection between strategic project management and company-wide goal attainment, effective methodologies, leadership training and development, and full-project sponsorship, project success rates will only continue to rise.
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