From optimism to catastrophe

It’s acceptable to pull the plug on a project when you’ve done everything right and still it goes wrong, says Professor Eddie Obeng


“Vamprojects[1]” are projects that suck the life-blood out of anyone unfortunate enough to be associated with them.  But even worse are “projectgeists”. These are projects which hang about in the organisation, haunting meetings, malodorous, delivering nothing of value but never ending.

When they are exorcised they give us great headlines. £30 million wasted on the Universal Credit project is nothing compared to £10 billion spent on the £12-billion NHS IT project before it was abandoned. And it’s not just cancelled IT or government projects that always seem to have been folded too late. And they are. It’s almost inevitable. And here’s why.

The people who lead project are optimists. They must be. Pessimists know the poor track record of project success – 12 to 30 per cent – and can’t bring themselves to start. Optimists believe that given time and money they can overcome any challenges which come their way. At the same time, the owners, the people with the power of go/no go are very senior managers – usually senior enough to have never had hands-on experience of the internal workings of a project.

But no matter, they have advisers who propose “best practice” organisations and structures to them. They have people who prepare business cases for them. Above all, they have a project or programme manager with professional experience and a track record of success.

However, this is the 21st century, a period of rapid change, ambiguity and turbulence. Best practice passes its sell-by date quickly, so the best practice – one-to-one accountability and steering groups – now means a break in the chain results in lost information flows, and business cases that don’t distinguish between quick delivery, making the case resilient and “all for nothing” approaches, which  can easily be made obsolete by a changing business environment.

Traditionally, failure is seen as a “bad thing”. People who have failed in the past have suffered for it. And cancelling a project is a sort of failure so no project owner is in a rush to cancel a project. A good way to avoid failure is to remove risk, parcelling it off to suppliers, tying suppliers into punitive contracts.

But outsourcing the risk doesn’t necessarily remove it.  It simply delays the date when you find out it has already gone wrong. The contracts encourage suppliers to hide problems, making it difficult for project owners to know how bad things really are. The internal project team of optimists are also unlikely to tell the owner because a) they believe they can fix it and b) they know they will suffer the blame.

Twenty-first-century best-practice metrics, red-amber-greens and spreadsheets focus on hard data of what happened yesterday. There are few softer measures on the mood or feeling about the project and often nothing tracking the changes in the outside world which are overtaking your project.

I use a “fog index” to describe the uncertainty within 21st-century projects. At the “painting-by-numbers” end of the spectrum, quarterly or monthly meetings are frequent enough to keep you aware. But at the other end of the scale, monitoring must be continuous and by listening to people from across the project not just up the reporting lines. Sticking to a monthly cycle means projects can suddenly become a month late overnight as you stay blissfully unaware of the catastrophe that has overtaken you.

If a blame culture exists, it’s time to chop

Remember the owner who is in no hurry to cancel the project? Well, neither is the project manager, the one with the track record to protect. By now the danger signs are hard to ignore. But what are they to do? Most project plans do not have a mechanism for ending the project and it takes time to put this in place. This extra time is useful because it is a chance to find excuses for exit, which is why project cancellations often occur after a new incumbent takes over the role. And don’t forget the embarrassment. Also, if the project is to be cancelled, what are we to replace it with?

So, since the owners rarely know how bad things are and there is an optimism to “give it another go”, the business case probably became obsolete without anyone noticing and, after all, the owners are not really rushing to cancel the project, it really is no surprise projects never get folded when they should.

Therefore, when should you fold a project?  There are five warning signs to look for:

  1. Check the business case – if it can’t survive halving the benefits and doubling the cost, start to reach for the axe.
  2. Check the deliverables – have they been “chunked up” so that, instead of having to complete all the effort before benefits are realised, project design is structured like a large development where some houses can be sold and inhabited while others are still being built? – if not, take the axe.
  3. Check the understanding of the project fog index – risk must be removed not outsourced, information flows should be more dynamic, discipline on agreed activities must be higher – if not, grip the axe tightly.
  4. Check the project team – if success is totally dependent on the project leader or the team are over optimistic or fragmented, you need to begin to raise the axe.
  5. Check the culture – for projects, especially at the foggy end of the index, look for a culture of “prelimination”, identifying and fixing issues before they go off track and have a constant plan B; look for an understanding of “smart failure” – that it’s OK to stop if you did the right things and still couldn’t make it work – if a blame culture exists, it’s time to chop.

Professor Obeng is learning director of Pentacle The Virtual Business School.

He holds the Monty Finniston lifetime achievement award for his contribution to project management. His books include All Change! The Project Leader’s Secret Handbook, Perfect Projects, and Putting Strategy to Work.  His next book on the subject, ZERO, on delivering faultless projects, will be out at the end of the year.

Eddie spends much of his time as an avatar (qubot) using Pentacle’s virtual campus QUBE to deliver interactive courses and enhance project delivery around the world.

@EddieObeng

[1] From All Change! Eddie Obeng, FT Publishing