Project Management: What Champion Organisations Do Differently
5 March 2017
Project Management Institute’s 2017 Pulse of the Profession®: Success Rates Rise: Transforming the High Cost of Low Performance shows 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.
There has also been a significant decline in money wasted due to project failures. Organisations are wasting 20 percent less money compared to a year ago; an average of £97 million* for every one billion invested—the lowest number we have seen since PMI began tracking this metric in 2006.
While these improvements represent significant progress, it is important to understand that the definition of success is continually evolving as new business trends emerge. The traditional measures of scope, time, and cost are no longer sufficient. When determining project success, we now look not only at the traditional measures but also at levels of maturity in benefits realisation – identifying benefits at the outset and ensuring that they are realised and sustained after the project ends. By evaluating project success through this wider lens, PMI has identified two new levels of organisational performance: champions and underperformers.
Champions are organisations in which 80 percent or more of projects are completed on time, on budget, and meet original goals and business intent and also have high benefits realisation maturity. Champions waste nearly 28 times less money because more of their strategic initiatives are completed successfully.
By contrast, underperformers are organisations where 60 percent or fewer projects are completed on time, on budget, and meet original goals and business intent and have low benefits realisation maturity.
Below are some key ways that champions outperform underperformers in order to increase successful outcomes:
More than three quarters (76 percent) of champions prioritise the development of technical skills and leadership skills, while almost two-thirds (65 percent) prioritise strategic and business management skills. The contrast with underperformers is stark: just 19 percent prioritise technical skills; 16 percent prioritise leadership skills, and 14 percent prioritise strategic and business management skills.
The strategic role of the project management office (PMO) and enterprise project management office (EPMO) is vital – and champions recognise this. 81 percent have a PMO, compared to 59 percent of Underperformers. Additionally, 56 percent of champions have their EPMO highly aligned to the organisation’s strategy, compared to just 12 percent of underperformers.
Actively engaged executive sponsors continue to be the top driver of whether projects meet their original goals and business intent. The best executive sponsors have detailed knowledge of a project and how it connects to business strategy. More than three-quarters (77 percent) of projects at champion organisations have actively engaged sponsors, compared to less than half (44 percent) of underperformers.
As a longtime advocate for project management’s essential role in any organisation’s success, PMI is encouraged by the progress being made in key areas that boost project management maturity.
Written by Mark A Langley
* Figures represent a percentage that applies to any currency.
Mark A Langley is president and CEO of the Project Management Institute