There are a lot of rating models out there that attempt to define project success or failure. There is the traditional one:
- Success: Finished (more or less) on time, within budget and met all requirements
- Challenged: Reaches conclusion, but with cost overruns and schedule slippages; possibly not all specifications are met
- Failure: Project was abandoned or cancelled due to project management failure
I can’t say that I am a big fan of it, because it fails to incorporate the value (i.e. the project portfolio management) perspective into the model. Recently I came across the one I really liked – a model that considers both project management (PM) and project portfolio management (PPM) sides proposed by Harold Kerzner:
- Complete Success: Project met success criteria, value was created and all constraints were adhered to
- Partial Success: Project met the success criteria, the client accepted the deliverables, value was created, not all of the constraints were met
- Partial Failure: Project was cancelled. But some IP was created that can be used on other projects
- Complete Failure: The project was abandoned and nothing was learned
My view of a successful project is slightly different. I basically like to (1) add word “reasonably” to the “adhering to constraints” sentence and (2) include the recoverability variable into the equation:
- Project success is a function of:
- Business value is realized
- Project is delivered reasonably on-budget
- Project is delivered reasonably on time
- Project scope is delivered within reasonable limits
- NOTE: “reasonable” = “does not negate the business value”
- Projects should also be differentiated by their recoverability
Regarding the first point, let us examine the following famous examples:
- Titanic movie (cost -$200 million vs. revenues – $2 billion)
- First iPhone (cost – $150 million, revenues – $2.7 billion)
- Grand Theft Auto 5 (cost – $265 million, revenues – US $1 billion in its first three days!)
Would we call Titanic a troubled project if it was released on 18-Jan-1998 instead of the original 18-Nov-1997? Would we think of the iPhone as a failure if its development ended up costing $160 million instead of the original $150 million? Of course, not!
So, what happens if we try to look at projects from the PM success/failure, PPM success/failure and recoverability/non-recoverability perspective .In the upper left corner (green) we have projects that are on track both from the PM and PPM perspectives. These ventures should be just properly monitored and controlled until their successful completion.
The next(yellow) layer contains the troubled projects (either on the PM and/or PPM side), but these projects can still be saved by adjustments to their scope, schedules, budget, governance etc.
Finally, the last layer (red) consists of the projects that are so deep in trouble from PM and/or PPM viewpoints that the only option available to the stakeholders is to kill them, unless they are “stay-in-business” or regulatory initiatives.
What do you think of this project success/failure rating? What other approaches have you seen?