Project Success. Contents. Introduction 2. Reference material 2. Overview 2. Success Parameters 3. Benefits 3. Project Success Criteria 4

Transcription

1 Project Success Contents Introduction 2 Reference material 2 Overview 2 Success Parameters 3 Benefits 3 Project Success Criteria 4 Key Performance Indicators (KPI) 6 Success factors 6 Project Training Solutions Ltd, March

2 Introduction The successful accomplishment of a project is ultimately judged by the project stakeholders who are groups and individuals with an interest in the project. Such judgements can be highly subjective unless steps are taken to define and agree appropriate criteria for evaluating project success. Success criteria also need to be communicated to project stakeholders and continually reviewed as the project progresses through its various phases. This topic explains the various parameters, indicators and factors that are used to define project success. Reference material It is recommended that you read: APM BOK v 5: 2.1 Project success and benefits management in conjunction with this topic. Overview Stakeholders will view project success in different ways. For example, users are likely to judge project success by the performance of the product. Investors may judge the project against how much financial return they gained from their initial investment, and corporate management on how well the project provides benefits during operation, such as market growth and achieves strategic objectives. It is therefore important to undertake a thorough stakeholder analysis at the beginning of the venture in order to establish: the needs of the stakeholders the specific performance criteria for the execution of the project and the finished product in service any conflict between stakeholders needs any factors likely to affect project execution The specific performance requirements for the product in service are stated in a product requirements specification. These will be used to control product Project Training Solutions Ltd, March

3 development and validate the product during acceptance and handover. The specific performance requirements for project execution are contained in the project management plan. They usually include cost, time and quality requirements and are often called success criteria. They are used to control the project during implementation. Success Parameters The APM describes the parameters of success in four ways: Benefits obtained as a result of the project Success Criteria targets for accomplishment of the project Key Performance Indicators measures of success Success Factors enablers of success These are discussed in more detail below. Benefits It is important to define and quantify benefits during the development of the business case. may be: increased capability increased sales Examples of benefits increased market share increased profitability improved customer satisfaction Benefit: The quantifiable and measurable improvement resulting from completion of the project deliverables that is perceived as positive by a stakeholder. It will normally have a tangible value, expressed in monetary terms, that will justify the investment. APM BOK version 5, Glossary, p 127 Benefits are realised mainly after the product has been delivered to users. The management of benefits is defined in a benefits realisation plan which specifies who is responsible for achieving the Project Training Solutions Ltd, March

4 benefits, and how the benefits will be measured and controlled. Benefits are directly related to project costs, timescales and the performance of the delivered products. For example benefits may be affected by the following causes: if the target development costs of a project are exceeded returns may be lower than anticipated if the product is delivered late, returns will consequently be late and in some cases the market may be lost to a competitor if the product falls short in performance, it may fail to achieve its market potential, require rework or lead to compensation claims. Project Success Criteria Success criteria are the specific parameters that will be used to judge how well the project was performed. They provide an important focus for project stakeholders and are used to control project performance up to handover. Success Criteria: The qualitative or quantitative measures by which the success of the project is judged. APM BOK Version 5, Glossary, p160 They should be measurable and unambiguous to avoid conflict between stakeholders. They should be realistic and therefore achievable by the project team within the constraints placed upon the project. They will be unique to the project and derived from the stakeholders needs. In summary, effective success criteria will be: Defined as part of the business case Reviewed at the end of each phase SMART (Specific, Measurable, Achievable, Realistic and Time bound) Project Training Solutions Ltd, March

5 Agreed between the Sponsor and the Project Manager Include a tolerance Typical success criteria are: Cost, Time and Quality. Quality usually relates to the quality of the work performed and also the performance of the finished product. Some organisations prefer to use performance in place of quality. Scope is also sometimes used although APM defines scope as the sum total of the work content of the project. In some Time Quality organisations, success criteria may be referred to as project constraints which APM defines as things that should be considered as fixed or must happen, and restrictions that will affect the project. Other success criteria may be safety levels, reputation, or any other criteria defined as important by the project stakeholders. Success criteria are initially defined in the business case and later, typically in more depth, in the project management plan. They are interdependent and need to be balanced at the beginning of the project and adjusted as the project progresses to take into account changing priorities. The balance and tolerances should be agreed by the project sponsor and manager. They are also related to the scope or work content of the project. For example: if work increases, cost and time are likely to increase Cost Figure 1 Examples of Success Criteria if timescales are shortened, additional costs for overtime, premium deliveries, etc. may be needed or the scope of work reduced if a higher performance is required for the finished product, additional work Project Training Solutions Ltd, March

6 and therefore costs may be necessary Key Performance Indicators (KPI) These are measures that are used to monitor performance Key Performance Indicator: against success criteria. For Measures of success that can be used example, comparing the current throughout the project to ensure it is forecast completion date with the progressing towards a successful conclusion. plan will indicate how likely the APM BOK Version 5, Glossary, P 142 planned date can be achieved. Similarly, cost and technical key performance indicators will show how well a project is achieving its cost and performance success criteria. For example, Earned Value Analysis provides a Schedule Performance Index and Cost Performance Index which are useful for controlling time and cost. Key performance indicators are usually included in the project management plan. Success factors Success factors are elements of the project context (environment) and management processes that will enable success or reduce the chance of failure (see figure 2). For example: senior management support Success Factors: Factors that when present in the project environment are most conducive to the achievement of a successful project. The success factors that if absent would cause the project to fail are sometimes called critical success factors. APM BOK Version 5, Glossary p 160 clearly defined goals good communications team motivation Research has shown that the absence of such factors is likely to lead to failure and therefore, the project sponsor and manager should identify and address any Project Training Solutions Ltd, March

7 weaknesses, and build on existing strengths. The APM provides the following examples of the causes of project failure: lack of a clear link with key strategic objectives lack of a clear senior management and, in government projects, ministerial ownership and leadership lack of effective engagement with stakeholders lack of skills and proven approach to project and risk management lack of understanding of, or contact with supply industry at senior levels evaluation of proposals driven by initial price, rather than long term value for money too little attention to breaking down development and implementation into manageable steps (Directing Change: A guide to governance of project management (apm.org.uk)) A strategy that addresses these points is likely to enable project success. For example, stakeholder integration (or management) planning should address communication needs and thereby ensure that information required by stakeholders for effective decisions is available on time and to the required quality. Good communications will ensure that team members know who to inform, who to contact when things go wrong, who to report to and who to refer to for key decisions. Whilst this factor will not necessarily ensure good decisions, it will reduce the possibility of poor decisions. Success Factors Cost Time Quality Figure 2 Success Factors Project Training Solutions Ltd, March

8 Success Factors should be established during feasibility (Concept Phase) and appropriate strategies should be incorporated into project plans during the Definition Phase. The SWOT (Strengths, Weaknesses, Opportunities, Threats) technique and post project review reports can be used to identify typical factors. These are covered further in Reader 106R/TU Project Context. Project Training Solutions Ltd, March