What we learn from the 2016 PMI Project Management Review

The eighth PMI Project Management annual review is called ‘The High Cost of Low Performance‘. It contains some important findings for businesses, executives, and project managers.

In this article, I will extract the juicy bits and add our own OnlinePMCourses comment to some of the PMI’s own conclusions.

PMI Project Management Conclusion No 1

The important conclusions start with the PMI President’s foreword on page 1. Here, Mark Langley says:

Organizations that invest in project management waste 13 times less money because their strategic initiatives are completed more successfully.

If this is not a stark case for the ROI (Return on Investment) of project management, I don’t know what is!

However, I want to pick up on the main trend Mark identifies. In the 2016 data, the PMI found declines in the success factors it tracks. This year, fewer projects, not more, met their goals. Organizations, the PMI concludes, are not focusing on project management. In addition, the summary findings make clear that fewer projects are completing within budget, or meeting their original business intent.

OnlinePMCourses’ Assessment

Uncertain times tend to entrench familiar, comfortable habits. And these, if any are, are uncertain times. However, businesses and individuals that want to thrive and come out of this period fitter, must invest in new skills. And strong project management capabilities are among the most valuable investments you can make.

PMI Project Management Conclusion No 2

There’s more to project management than technical skills. The PMI Project Management skills framework is articulated in their ‘Talent Triangle’ [TM] of:

• Technical Project Management
• Leadership
• Strategic and Business Management

This very much complements our own assessment of Hard and Soft Project Management skills. The data suggest that projects are more successful in organizations that focus on all three skills sets. Indeed, they give the figure of 39 per cent more projects meeting their goals and business intentions.

Organizations that prioritize all three components of the Talent Triangle achieve:

• 39% more projects meeting their goals (71% vs 51%)
• 68% more projects within budget (64% vs 38%)
• 74% more projects delivered on time (61% vs 35%)
• 28% fewer projects suffer from uncontrolled scope creep (38% vs 53%)
• 38% fewer projects were deemed as failures (13% vs 21%)

OnlinePMCourses’ Assessment

Training is important, as we will see even more clearly with the next PMI Project Management conclusion. But to get the best value, it needs to be balanced between hard technical skills and the softer skills that the PMI characterizes as leadership, strategic, and business skills. Our more comprehensive core courses introduce these skills. And as we build out our course programs, we will create courses that address the full range of skills you will need to be a first class project manager.

PMI Project Management Conclusion No 3

In the 2016 Pulse of the Profession report, the PMI quotes Sudhakar Kesavan, Chairman and CEO of ICF International, Inc.

The more project management expertise we have, the less likelihood of complications with the client, overruns and cost issues.

The PMI’s project management review findings endorse Mr Kesavan’s comments. Most noteworthy of their findings are a very similar set of improvements to the ones above, arising in organizations that invest in all four of:

1. ongoing project management training
2. defined career path for project professionals
3. formal processes to develop project management competencies
4. knowledge transfer processes

So, the equivalent figures to the list above are:

• 31% more projects meeting their goals (71% vs 54%)
• 55% more projects within budget (65% vs 42%)
• 66% more projects delivered on time (63% vs 38%)
• 37% fewer projects suffer from uncontrolled scope creep (34% vs 54%)
• 38% fewer projects were deemed as failures (13% vs 21%)

OnlinePMCourses’ Assessment

On the face of it, the PMI Project Management conclusions 2 and 3 overlap. PMI is keen to underpin its trademarked ‘Talent Triangle’, but the core message of both sets of data is simple:

Strong, balanced training and development programs save money and lead to better projects that deliver on time more often.

PMI Project Management Conclusion No 4

The PMI found that the proportion of organizations in their survey with a Project Management Office (PMO) is static. And it has been at less than half, for 5 years.

Yet this is despite the clear findings that PMOs deliver great results, especially when an Enterprise-level PMO is able to align projects with corporate strategy. So once again, we see a very similar picture:

• 27% more projects meeting their goals (71% vs 56%)
• 32% more projects within budget (62% vs 47%)
• 44% more projects delivered on time (59% vs 41%)
• 30% fewer projects suffer from uncontrolled scope creep (38% vs 54%)
• 24% fewer projects were deemed as failures (13% vs 17%)

OnlinePMCourses’ Assessment

For any but the smallest organizations, a PMO should be a core part of your governance structure. Read Peter taylor’s excellent primer on Project Management Offices in two parts:

• Part 1: Introduction to PMO, The Absolute Essentials
• Part 2: Successful PMO, Six More Lessons

PMI Project Management Conclusion No 5

The fourth factor that the PMI finds to have a similar impact on project outcomes is effective sponsorship. Despite this, the PMI project management survey found a year-on-year drop in the proportion of projects with active sponsors. Shockingly, they state that they found only 59% of projects had engaged project sponsors!

Let’s see their stats on project performance:

• 65% more projects meeting their goals (76% vs 46%)
• 65% more projects within budget (66% vs 40%)
• 72% more projects delivered on time (62% vs 36%)
• 20% fewer projects suffer from uncontrolled scope creep (48% vs 40%)
• 52% fewer projects were deemed as failures (10% vs 21%)

OnlinePMCourses’ Assessment

These figures are astonishing. If we accept the data PMI gives us, then it seems to me that the single greatest influence on project performance is active sponsorship. But of course the four components of capability balance, training, PMO and sponsorship are not discreet for one-another. Many organizations that have one will have two or more of these. And many which lack one will lack most or all.

A well trained project manager will fight for a strong sponsor and help them to engage actively. A strong PMO will secure good training and support active sponsors. A wise and engaged sponsor will demand balanced capabilities and a supportive PMO.

Indeed, this matches my experience closely. Many organizations I work with are reluctant to train sponsors, even when participants on live courses sry out for their bosses and sponsors to get training. Yet, when I do run workshops for project sponsors and project board members, the results are spectacular.

PMI Project Management Conclusion No 6

There is a great table (Figure 9) in the 2016 PMI Project Management Pulse of The Profession report. It is designed to show the differences in perceptions of PMO directors and executive leaders. What it also shows is that they share a strong perception of the benefits of formal project management to an organization. These include:

• Higher organizational agility
• Greater cost savings
• Improved risk identification and mitigation
• Competitive Edge
• Better success in organizational change
• Improved customer satisfaction
• Greater Return on Investment (ROI)

OnlinePMCourses’ Assessment

These each represent significant bottom-line benefits to commercial organizations and service delivery benefits for public sector and not-for-profit organizations. They cry out for more skilled project managers, and for more-skilled project managers.

The PMI Project Management Call to Action

It matches my own closely. PMI argues that organizations should:

1. Invest in skills training, including leadership, strategic, and business skills
2. Engage executive sponsors, and ensure their active commitment to projects
3. Align the agenda of enterprise PMOs with the organization’s strategy

What do You Think?

Have you read the 2016 PMI Project Management Pulse of The Profession report?

What findings struck you?

What do you think the state of Project Management is currently?

Most of all, what are our priorities as a community?

Leave your comments below and let’s start a discussion.

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