The State of Project Management 2017
PMI’s 9th Pulse of the Profession Report provides an interesting overview of the state of project management in 2017 based on an extensive global survey covering 3,234 project management professionals, 200 senior executives and 510 PMO directors across a diverse range of industries
Key findings include the following:
Organisations are making good progress in their approach to project management. For the first time in five years, more projects are meeting original goals on time, on budget.
Supporting PMI’s view that effective project management is critical to business success, organisations investing in proven project management practices waste 28 times less money than others due to more of their strategic initiatives being successfully completed. The amount of money being lost as a result of poor project performance, however, remains unacceptable – an average of $97m for every $1bn invested.
While good progress is being made, more still needs to be done. The report calls for a wider approach to measuring project success with on time, on budget no longer being enough. The realisation of expected business benefits should be included as a key performance measure.
This more inclusive approach to measuring project success is already being adopted by ‘Champions’, defined as organisations with 80 percent or more of projects being completed on time, on budget, meeting original goals and business intent. ‘Champion’ organisations exhibit higher levels of benefit realisation maturity compared with ‘underperformers’ defined as organisations with 60 percent or fewer projects being completed on time, on budget, with low benefits realisation.
A key finding of the report is the growing importance of the Project Management Office (PMO) in bridging the chasm between high-level strategic vision and implementation. Organisations with a strategic enterprise-wide Project Management Office (EPMO) report 38 percent more projects meeting original goals and business intent, with 33 percent fewer projects deemed as failures. This is due to the closer alignment of the EPMO with strategy.
Organisations are increasingly embracing Agile as a technique for managing projects. A full 71 percent of those surveyed claimed to follow agile approaches. Over the last year, one in five projects has involved the use of Agile. ‘Champions’ have a greater tendency to use Agile compared to ‘underperformers’ – 55 percent versus 24 percent.
Compared to last year, executive leaders are classifying more of their organisation’s projects as ‘strategic initiatives’ (50% versus 38% in 2016) with key challenges including bridging the gap between strategy formulation and execution; tackling technology and digital disruption; the need for innovation; the growing expectations of customers; competitiveness; and the changing workforce.
With one in four (28%) of these strategic initiatives failing outright, the role of the PMO has become critical in driving agile transformation. The report argues that as more organisations embrace project management as a strategic competency, PMOs will become the conduit for executing an organisation’s portfolio of projects and strategic initiatives. Seventy-one percent of the organisations surveyed already have a PMO compared to 61 percent previously. PMOs are also performing a more strategic role aligning project portfolios to strategy; monitoring progress and optimising strategy delivery; navigating risk; driving benefits realisation; enhancing governance and accountability; managing talent. More ‘Champions’ recognise the strategic importance of the PMO, 81 compared to 59 percent for ‘underperformers’.
The report concludes that projects and programmes are core to an organisation’s strategic initiatives. They are how change happens. Having the talent to implement those initiatives successfully is the critical capability that gives organisations a competitive advantage to navigate through the required change. Excellence in managing that talent is a key differentiator in unlocking capability. As a consequence, developing the technical, leadership and business management skills of project professionals should be a key priority.
The full PMI Report can be found here – well worth a read.
As always, comments and feedback are very welcome.
Please see here for previous posts in our series on PMOs.