Project Management

3 Key Principles to Reduce Project Failure

A failed project is not the end of the world, but it is no cause for celebration either. Studies place failure rates of projects somewhere between 40% and 70%, which equates to tremendous amounts of time and money lost over time. Understanding why failure occurs is the first step toward remedying this problem, and an article from The Skills Portal notes three key principles to reduce project failures:

  1. Capturing knowledge ensures organizational learning
  2. Improved communication improves collaboration
  3. Reducing waste improves gains

Capturing knowledge means making sure the right knowledge is accessible to the right people, which becomes more important than ever as today’s business environment increasingly involves complex operational challenges and more geographically dispersed teams. It also means being able to transform the implicit into the explicit:

[Researcher Terry] van Graan shows that only 20% of an organisation’s knowledge is explicit, in the forms of documents, procedures, processes and databases. The other 80% is tacit, in the form of undocumented, unshared, untapped know-how. To be effective, organisations have to find ways to leverage the tacit knowledge that exists in the heads of professionals – who experience the projects first hand and convert it into easily accessible explicit knowledge that can be used to guide future projects. “It is about capturing what we learn today for what we’ll be doing tomorrow,” says [consultant Dennis] Comninos.

The article recommends that organizational communication can be improved by taking advantage of social media. Corporate users can expect to receive and exchange over two hundred emails per day, which is just impractical, and in a study of 4,200 major companies, embracing social media freed up $1.3 trillion, two-thirds of which was due to improved communication and collaboration. If that much money can be saved by merely improving the way people communicate, there is no good reason not to explore the possibilities that social media entails. Even more money can be saved by reducing waste, especially when it comes to energy and water consumption, where upwards of half is wasted by companies on average. Smart technology and building approaches go a long way over time in fighting this. When you take heed of these three principles, inevitably, projects will still continue to fail. All the same, improving communication and reducing waste means more money is available to devote to projects, and with the right network in place to share knowledge, failure rates will take a dive. And that is something worth celebrating.

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