There has been a 27% decrease in the amount of money organisations are wasting on failed projects since 2013.
That represents a drop to just less than 10% of every dollar invested from 13.5%, according to the 2018 PMI Pulse of the Profession project management survey.
However, despite the decline in the amount of money wasted on poor project performance, PMI President and CEO Mark Langley maintains that this figure is still too high.
He attributes this wastage to three key issues:
- Organisations failing to bridge the gap between strategy design and delivery;
- Executives not recognising that strategy is delivered through projects; and
- Low levels of recognition of the importance of project management as the driver of organisational strategy.
Conducted since 2006, the annual Pulse of the Profession is the premier global survey of project, programme and portfolio management professionals from around the world. The recently published 2018 edition features feedback and insights from 4 455 project management practitioners, 446 senior executives and 800 project management office (PMO) directors from across a range of industries and Latin America and Caribbean regions.
This year's report, entitled "Success in disruptive times, expanding the value delivery landscape to address the high cost of low performance", examined the differences between what it terms "champion organisations", those who complete 80% or more projects on time, on budget, meeting business intent and having high benefits realisation maturity; and "under performers", organisations with 60% or fewer projects that meet the same success criteria.
The report notes that in a world of constant disruption, having new ideas and envisioning a strategy is essential to every organisation, but warns that real value and benefits can only be delivered if businesses are able to take ideas from paper and translate them into reality.
The research found that "champion organisations" invest in proven project management practices and so experience greater success than their underperforming counterparts. They mature their project talent, project capabilities and culture and so have a significantly higher project success rate (92% versus 32% of under performers). They also enjoy more successful business outcomes, and waste over 20% less money - 1.4% of every dollar wasted compared to 29,2% for under performers.
XHead = Key findings
Other key findings of the survey included:
- Only 58% of organisations surveyed fully understand the value of project management;
- Just over 40% of organisations with an enterprise-wide project management office (EPMO) have closely aligned it with the organisation's strategy;
- By far the majority of organisations (93%) use standardised project management practices in an effort to reduce risk and attain better outcomes;
- Nearly three-quarters (72%) of organisations report greater agility over the last five years; and
- One in three organisations report high benefits realisation maturity, in other words recognition that evaluation of project success has to go beyond traditional outputs such as time, scope and budget.
"In the end, champion organisations ensure their project and programme managers have the right skills to drive and navigate change in this dynamic environment. They are bringing about organisational change through projects and programmes and saving millions of dollars in the process," the report concludes.
The full Pulse of the Profession Survey(R) can be viewed at www.pmi.org/Pulse.