Project Management:Project Turnaround

From Evrose

An incredible amount of money is wasted each year by businesses and individuals through poor control of projects. In this series of articles we will examine the problems, causes, and possible solutions.

Common problems with failing projects include:

• Cost overruns.
• Late delivery.
• Suppliers not delivering.
• Benefits not materialising.
• Unrealistic objectives and expectations.

There are generally three solutions to failing projects.

• Review, write it off, and abandon.
• Review, take what you can, and move on
• Review, regroup, re-plan, and move forward.

The choice of solution depends on a number of factors, one of which is cost. If there are not the funds to complete the project regardless of benefits, then the only prudent courses of action are either to write off or to extract whatever you can, and in both cases then abandon the project. Similarly, if moving towards completion would cause the costs to permanently outstrip any benefits that could be gained, then write off or take what you can are prudent. However, if the objectives can be re-assessed, options reconsidered, and the costs going forward plus costs already sunk can continue to be justified by the benefits that will ultimately accrue, then it is worth considering a salvage operation. Note that cost is not always a straight financial calculation and consideration should also be taken of the not-so-obvious repercussions of a failing project, such as loss of reputation.

Another key factor is whether it is actually technically possible to salvage the project, which is why "review" is the starting point in all possible solutions. It is absolutely essential, whatever your gut feel, to take the time to do a complete and objective assessment of where your project currently is. Essential, that is, to definitively determine what is at the root of the problems. Some of the most common root causes, from the biggest corporates to a home owner just wanting some minor building work done, are:

• Failure to adequately decide and document your initial requirements. You wanted a car but described the requirement as transport from A to B. You got a bicycle. You didn't get what you expected but you got what you asked for.

• Failure to be sensible about your requirements and expectations in respect of time and cost. You want a car but you expect a new custom built Bentley, you want it next week, and your budget is no more than £10k. Sounds ridiculous but it is not uncommon for customers to require things that don't exist, won't believe you when you tell them that, and/or don't have the funds to get anywhere close or any idea as to how long it takes to customise products.

• Failure to do your homework on supplier capability. You wanted a car but decided to buy it from a bicycle shop not a car dealer. Trusting the word of a salesman, without checking references, is extremely common. If you want a car go to a car dealer and check them out to make sure other customers have not had problems with shady practices in the past.

• Failure to get a full and detailed proposal from suppliers. If you have, perhaps for legitimate reasons, been a little vague over some requirements (it is not uncommon for people to know where they want to go but not how to get there), then you at least want to know, ahead of signing a contract, exactly how they propose to fulfill your requirements. You ask for transport, the bicycle shop proposes a mountain bike, you know they have misunderstood.

• Failure to do the legal and contractual paperwork. You told the bicycle shop you wanted a car verbally, you are sure you did, you are sure they said they understood, but you just put "transport" in the written order. You can prove nothing.

• Failure to ensure that the price on the contract includes everything you want, and specifies the cost of optional extras you might want to take up later. You decide to accept the bicycle but insist it should come with lights. Lights are not specified in the order, it is a non-standard mounting, and the bicycle shop says lights will double the cost.

• Failure to communicate with suppliers properly and make sure they understand your objectives. You wanted a car so 4 people could travel together on a 20 mile journey in 30 minutes. Even if you only specified "transport" but coupled it with that objective, it is clear to all that a bicycle could not be fit for purpose, and can be rejected as a valid solution.

• Failure to control a project at all of its stages, believing your responsibility ends when you tell the IT guy, or the builder, or the bicycle shop what it is that you think that you want. You said you wanted transport and left it to the accounts department/the company lawyer/the wife/the dog to draw up the order and sign the contract with the bicycle shop. Had you known... well you should have made it your job to know.

It is the job of a supplier to maximise their profit. If they are looking to make a quick buck and you have not done your homework and found that out, then you stand a good chance of having your expectations dashed. It is your job, no-one else's, to ensure you are clear, unambiguous, as detailed as you need to be in your requirements, and do both your supplier research and legal homework. If you have a failing project then something in there has gone wrong and to put things right you have to know what and why. Glossing over errors helps no-one to learn from mistakes, and will mean your chances of salvage are cut substantially. Be honest and painfully critical.

Why do people make these basic mistakes? There are a number of reasons, and they happen as often in big projects in big organisations, as with individual who may be excused as inexperienced in project management.

• "He came highly recommended... by his mother".
• "I trusted the salesman/saleswoman's advice - they know better than I do".
• "It's only a small job, what can go wrong?".
• "We didn't have the time".
• "We don't solutionise" - not an uncommon statement to be heard in organisations that have outsourced services.
• "I didn't read that bit in the contract".
• "I thought they understood what I wanted".
• "I didn't know what I wanted but I know it wasn't what we got".
• "I don't know what all that legal and contract stuff means".
• "Our company policy is [name the excuse]" - if your company's policy is to throw away money then find yourself another job quick as your wages are not safe.

In later articles we will look in more depth at some of the these causes of failure and how to avoid them. Only when you understand that will you know whether your project is salvageable.

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© Evrose Business Consultants Ltd, 2009