People Management: Why Projects Big and Small Fail

Transformation. It’s the buzzword of the day/year. In a nutshell, transformational initiatives are larger and more complex with more on the line than large projects of the past. And so far, are these current initiatives faring better than the large ones from two decades ago?

It’s spotty, to say the least.

Under old management

Project management practices have become standard in many companies today, yet the truth is that project success statistics haven’t improved much over the last 30 years. And the fact is that the project management discipline as a whole seems to address issues but forgets to focus on the root cause of these failures. Until companies focus on the importance of leadership skills as the primary task, projects will continue to fail. Project management is more about managing people than methodology. Let’s explore a few examples:  

1. Ford Edsel – became synonymous with failure
   Developed and manufactured during the 1958-1960 model years, the Ford Motor Co. had expected to significantly gain market share and close the gap with General Motors in the American automotive market. Yet, the Edsel never gained popularity with car buyers and sold poorly. Ford lost millions of dollars on the Edsel’s development, manufacturing and marketing. The very word “Edsel” became a popular symbol for failure. The company lost $350 million, or the 2022 equivalent of $3.5 BILLION! Edsel’s failure is infamous because the vehicles were designed and manufactured, dealerships were created and promoted without understanding the feasibility of the model.
   Reasons for the Edsel failure: The Edsel was released going into a bit of a recession and people were looking for smaller cars. The Edsel was supposed to be a surprise release, resulting in few focus groups to understand the voice of the consumer. What is more, the quality of the Edsel was considered poor.
2. Affordable Care Act (ACA) – On day one of the rollout, only six people submitted and completed their applications. On Oct. 1, 2013, high website demand (five times more than expected) caused the website to crash within two hours of launch. The Act ultimately came in $1.6 billion over budget. So, what happened?  According to the inspector general of the U.S. Health and Human Services Department, the root cause of the Act’s failure stemmed from poor leadership. According to an article in Government Executive magazine:  “Challenges were made significantly more difficult because of lousy management—misplaced priorities, poor communication, insufficient contracting know-how, and a reluctance among senior officials to receive ‘bad news’.”
   Reasons for ACA rollout failure: The government site for signing up for the Affordable Care Act was rushed to release. The focus was on reaching the timelines on a plan though testing and quality were poor.
3. The United Kingdom’s National Program for IT (NPfIT) – The largest public-sector IT program ever attempted in the UK. Originally budgeted to cost approximately £6 billion, this National Health Service program was supposed to help streamline health information sharing and security across the country. Despite the rollout spreading over many years, the NPfIT program failed to deliver services and before exiting this engagement, ultimately cost British taxpayers more than £10 billion.
   Reasons for NPfIT failure: There were a host of program failures, but one of the main reasons included—from the very beginning—a technical and operational disconnect between the initiators of the project (UK Cabinet) and its implementors (health service workers) with respect to operating this massive health IT program.
   The typical focus of failed projects is to address the symptoms more readily visible in these and most failed projects: scope creep, poor vendor performance, poor business requirement development or difficult stakeholders, and poor project leadership. While this can create improvements, it is typically a less effective result. The common thread that runs through all three of these failures is the mismanagement of people and communication.

It’s about people

In the quest to find a consistent process and methodology for getting projects delivered, we have forgotten a fundamental truth: project plans don’t get the work done. People do! Project managers need to focus on developing their leadership skills and learn how to manage teams and expectations.

1. Communication: Projects and programs fail when communication fails/is non-existent/or is not properly inclusionary. In fact, I would rank this as the No. 1 reason for project failure. Projects fail at every stage of any project when the appropriate decision-makers are not involved in planning and design. They also fail if the end users or the people affected are not tuned in early and often enough to understand what changes they will be expected to deal with. It is why all of the above projects failed. If you don’t involve the right people in decisions and align them along the same expectations, someone (or multiple people) will be unhappy with the results in the end—guaranteed.
2. Accountability: Programs fail when people don’t have a clear view of their responsibilities. It may sound minor, but it becomes hard to hold anyone accountable if there are not clear definitions as to what each person is accountable for. Being nebulous can be the death of any delivery effort. I’ve seen plenty of companies that treat responsibility and accountability in the same manner: “I did my part” does not guarantee that others did theirs or that the integration points between all of the “parts” were coordinated.
3. Engagement: Programs fail when the wrong sponsors and owners are engaged. A simple but effective way to choose ultimate decision-makers on a project is to evaluate who has the most to lose if the project fails. By assigning sponsorship to the one that will feel the most pain if the effort fails to deliver, will ensure they will be more vested in getting it done right in the first place.

People, process and technology

I believe it is time that project delivery revamps itself because as projects have gotten bigger and more complex, the practice of change management has grown. Change management is a more recent phenomenon of delivering strategic initiatives yet, I would contend that change management came about because project management remains focused on the wrong things. Project managers are trained on process. Companies will make technology decisions before understanding the necessary requirements. This combination presents a focus on process and technology while forgetting the most important component.

Projects should follow the phrase: “People, Process and Technology.” Project managers tend to focus on two out of the three of those and neglect the people component—to the project’s detriment. Change management focuses on the people. However, if you focused project delivery on people, process and technology (in that order!), you may not require a change management practice in the first place. 

We see more projects include change management in their initial planning to address some of these issues but truthfully that is often used as a band-aid to a bigger problem. Frequent and consistent messaging to all levels of affected users should be the driver of these transformational efforts. It’s not just about driving consensus, but the effort must include a team (both stakeholders, employees, third parties and end users) who are communicated with in an effective manner.

Staying on track

It can be difficult to stay on track with a project and remember to include all three legs of the project’s “stool” (people, process and technology), so keeping the following warning signs in mind can help: 

• Scope Creep. Root cause could be:
  • Key stakeholders were not aligned (or possibly involved) upfront and things were missed 
  • There wasn’t a clear process in place to properly evaluate changes to ensure necessity
• Shelfware. Root cause could be that:
  • End users and affected resources of a major transformation were not brought up to speed early enough and are pushing back because they were not feeling bought in to the end result
  • Training was not conducted or was thrust upon them at the 11th hour
  • Users do not see the value of the new process or system
• Poor business requirements:
  • Planning was not deemed valuable and therefore was not completed properly
  • Business requirements were not documented 

This list could go on and on, but if you look for the one common trait, it is that people and their level of involvement are vital. 

Let’s keep the discussion going

Even when projects are running poorly, having a regularly scheduled checkpoint to evaluate the worth of continuing is a communication task not to be ignored. Silence when things are going poorly will only exacerbate the situation. As the examples listed above, and in our own experience when called upon to rescue a sinking ship, clear, consistent and honest communication is typically the fastest way to right-side the job.

Written by Laura Dribin.
Have you read?
The Art of Teams by Leo Bottary.
5 Ways To Build A Fool-Proof Marketing Strategy.
Who Should Get to Decide How and Where we Work by Val King.
The thing you need to fix before your next change program by Dr. Paige Williams.

This report/news/ranking/statistics has been prepared only for general guidance on matters of interest and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, CEOWORLD magazine does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.

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