Organisations Struggling to Deliver Change Due to Poor Project Management
As a quick follow-up to our recent blog post on the growing importance of the PMO as a key enabler of change, new research from Fujitsu claims that organisations are losing substantial amounts of money on failed digital projects.
While there is growing recognition of the need for digital change, the Digital Transformation PACT Report concludes that organisations worldwide are struggling to balance the elements needed to deliver successful change management projects and programmes.
Of the 1,625 business leaders surveyed, one in three had cancelled a project in the last two years at an average cost of £423,000; one in four (28%) had experienced a failed project costing an average of £555,000 per project.
The main reason for poor project performance, according to the report, was the disequilibrium that exists in bringing together four vital ingredients of digital transformation success: People, Actions, Collaboration and Technology (PACT) as shown in the infographic below.
While adding value to the growing debate on the HOW of transformation, the new Fujitsu report says little about the organisational structure challenges of implementing change.
The recent McKinsey Report, Secrets of Successful Change Implementation, October 2017, referenced in our previous post, is stronger in this respect.
Based on a survey of more than 2,000 executives, fewer than half of respondents stated that ‘most or all’ of their change efforts in the past five years had met their initial goals and sustained results over time.
Three main causes of failure were identified: organisation-wide ownership of and commitment to change; regular and effective prioritisation; and deployment of the right resources and capabilities.
The first of these was identified as the most important, with 67 per cent of ‘good implementers’ stating that clear, organisation-wide ownership and commitment to change across all levels of the organisation was critical to successful change management implementation.
The report singled out the Project Management Office (PMO) as playing an increasingly important role in this respect:
The right supporting organization: Finally, ownership and commitment are difficult to maintain in a major transformation without the support of an effective and empowered project-management office (PMO) – a formal entity directly responsible for leading the change effort and monitoring its progress. The PMO should be led by a relatively senior person who reports to a C-level executive and carries that executive’s authority.
As argued in our previous post, the Project Management Office is fast becoming the de facto organisational structure for standardising project management best-practice, ensuring that projects and programmes are delivered on time, on budget, with agreed outcomes achieved.
As always, comments and feedback are very welcome.