How to Spot Early Signs of Project Failure

Why do projects fail? Project failure is something that every project manager and every company, no matter how large or small, wants to avoid. Yet, for many, it seems almost unavoidable. There are tons of bad project management examples floating around the internet, and many of us may be familiar with the statistic that 50-70% of projects fail. 

Fortunately, with the right awareness, planning, and resources, you can ensure your projects are part of the 30-50% that succeed. Below are some of the top reasons of why do projects fail. Plus, we’ll share proven methods of how your project managers can spot the warning signs and combat issues early. 

Why do projects fail?

Project failure can be attributed to many different factors. However, most causes of project failure can be grouped into one of the following seven categories:

1. Too much focus on technical details rather than business value. It’s easy to get lost in the weeds of a project and forget to focus on the larger picture of what value the project is supposed to be delivering to your business and client.
2. A lack of clear requirements and accountability for results. Successful projects must have a detailed list of requirements at the beginning of each phase or sprint, and a means of ensuring these requirements are met. 
3. Poor processes for creating project plans, schedules, and budgets. Without a solid, reliable way to estimate and plan your projects (such as a database of similar past projects), you’re much more likely to suffer from cost and schedule overruns. 
4. Inadequate planning. Often, project teams jump into execution without taking enough time to finalize project plans. Without the detailed planning work upfront, projects can easily spin out of control. 
5. A lack of customer involvement. Projects are less likely to fail when you have informed, engaged customers who are involved throughout the entire project cycle. It's wise to think of your project as a high visibility project, meaning anyone who needs information can access it comfortably.
6. Poor team management. Excellent team management means effectively recruiting, training, motivating, and coaching the best people for the tasks assigned. People lacking the right skills, knowledge, and motivation will create productivity and quality issues. 
7. Inadequate resources. Your project team needs to have the right materials, tools, and other resources they need to complete their tasks successfully. Also, a lack of human resources can mean overworked employees who can't keep up with deadlines.  

Common issues in project management

The above seven categories of project failure cover a broad range of problems. But, they can be boiled down into three common issues in project management: 

1. People: Whether it’s your customer, sponsor, team members, or other stakeholders, people play a huge role in whether a project succeeds or fails. If you don’t have the right people doing the right things at the right time, your project can quickly tank. 
2. Processes: Project management frameworks, templates, and tools all work to help ensure your projects follow proven processes.. When you don’t institute solid processes, it becomes more difficult to plan, execute, monitor, and control a project effectively. 
3. Communication: As the saying goes, 90% of a project manager’s job is communication. Without frequent, consistent, and clear communication, misunderstandings and problems occur.  

Spotting project management risks and issues

It’s easy to identify a project failure after the fact, but how do you spot a project at risk of failure before it’s too late?

First, it’s important to identify potential risks to your project early on. Some common red flags to look out for are:

• Cost overruns
• Quality issues
• Slower than expected progress
• Missed deadlines
• Resource issues (including a lack of resources and overallocation)
• A lot of change requests
• A lack of engagement from stakeholders (including the client, team members, and others)
• Anything else that could affect project milestones or deliverable dates

By recording and managing relevant risks, your project team can create appropriate mitigation plans and contingencies. Continuing to monitor these risks throughout the project will help you identify any issues early enough that you may be able to resolve them before they send the project off the rails. 

The best way to spot and manage project management risks and issues is to adopt the right risk management processes, procedures, and tools. Using a risk monitoring tool, having templates for assessing and ranking risks, and having weekly or monthly risk meetings to evaluate changes and discuss contingencies are all common steps. 

Templates and tools to avoid project failure

Critical mistakes in planning, executing, or monitoring and controlling your project can lead to failure. Fortunately, there are numerous tools and templates to help you avoid missteps. 

Here are some of the best project management tools available to help avoid project failure:

• A central database. It's vital that your team base cost, time, and resource estimates on reliable data. A database that contains planned and actual performance on similar projects already completed can help improve estimates. 
• Project plan templates. Templates for common projects can not only speed up project planning and set-up but also ensure that no key tasks or steps are forgotten. 
• Project management software. A central project management tool helps ensure you have one source of the truth for project details. You can store key requirements, track changes, risks, and issues, and send out communications from a single software. 
• EVM (earned value management) tools. EVM can help you quickly assess costs and schedule performance to date and assess whether there may be a problem. For instance, an SPI (schedule performance index) below 1.0 indicates that the project is behind the planned schedule. 
• Reports and dashboards. Real-time reports and dashboards help everyone stay up-to-date on progress and can highlight any potential problems early on.
• Resource allocation software. These tools can help you monitor whether you have resources that are overallocated or sitting idle. 
• Communication tools. A tool like Slack can help promote more frequent communications between stakeholders and boost collaboration. 
• Gantt charts. A Gantt chart is an interactive timeline that lets you see a complete view of your project's progress, work scope, and dependencies.  

With Wrike, project managers gain access to robust features and templates that lead to success.Our software lets you create a central database, manage dashboards, generate reports, and automate processes with templates. Plus, you can integrate Wrike with 400+ apps and tools like Google Docs, Dropbox, and more. Get started today with a free trial.