Here are some alarming statistics

• Over 70 percent of all projects are late and over budget.
• Twenty-five percent of all projects are abandoned and not completed, or significantly scoped down so they no longer resemble the initial project.
• Less that five percent of all projects are completed on time and on budget.

What is a project? Why is it so hard to have it completed, especially within the timeframe and the budget allotted? Does this seem like a mystery?  Keep reading. ...

Definitions
The definition of a project (from Wikipedia, the free encyclopedia) is: “a finite endeavor—having specific start and completion dates—undertaken to create a unique product or service which brings about beneficial change or added value.”

Notice that change is in the definition of a project; actually to keep things simple, “project management is change management.” Change—by definition—means that we will no longer do things in the same manner that we used to; that hurts! I truly believe that we resist change long before we start embracing it!

Being a project manager involves being a change catalyst and working through the change psychology that people are faced as recipients of the new world.

One change management model, which was developed by Kurt Lewin in the mid 1900s, used a three-stage process called “unfreeze-change-refreeze.” Unfreezing requires the conscious process of emotional detachment from the old way of doing things. The change stage (i.e., the project) is the period during which confusion and transition occur. For the project to bring about lasting added value, the new world needs to be frozen in the third and final stage called “refreeze.”  This is a very effective way to think of the change process.

Before a Project Starts
Answers to the following six basic—but so important—questions will help your project be in the minority success group, i.e., those that are completed on time and on budget.

Questions: What? Why? How (and how much)? When? Who? Where?

The more clear and concise the responses are to each question, the better basis your solution (aka project) has of being successful. Let’s look at these:

1. What—Articulate the problem that needs to be solved

• The response to this question needs to clearly verbalize the problem and, where possible, the solution, i.e., “We need to implement a pricing model for our new D&O insurance, as we are losing premium revenue because of the increased complexity which our manual calculations can no longer handle."
• ”Answering the first “what” needs to be followed by “what” again. This time it describes the more granular understanding of scope; clearly express exactly what is included and also what is excluded.

2. Why—Clarify the impetus/driver behind this solution as well as the owner

• Usually the person who feels the most pain before the problem is solved is the right project owner/driver as they have the most to lose if it is not implemented. In this example the CUO (chief underwriting officer) or CEO may take ownership as they would be responsible for the following: “Our business will go bankrupt if we don’t fix the systems issues around our pricing models.”
• It is absolutely critical to have the pain point and the project driver/owner known and communicated to all involved, as change requires that extra push which can be given most effectively by the senior person feeling the most pain with the existing situation.
• The why often needs to be supported by a cost-benefit analysis, ROI calculation and/or payback period assessment. This will help ensure that the biggest pain points in an organization have a chance of being addressed and/or removed as the benefit is likely the largest for these existing problems.

3. How (approach) and how much (money)

• The approach to how a problem is solved is often dictated by the amount of funding available and/or the time available to fix it.
• The amount of money made available for the specific solution is often determined by how large the “pain point” is, subject to the organization’s funding ability. Always factor in a contingency factor for the unknown to avoid unnecessary cost overruns.
• The amount of time and money often dictate the approach; i.e. a shoe-string budget may require a bicycle journey to the destination rather than hiring a jet plane.

4. When—Deadlines need to be non-negotiable to be most effective

• The best strategy is to set internal (aka self-imposed) non-negotiable deadlines if there is no external deadline that you need to achieve.
• If there is opportunity to delay the completion of the project, then perfectionism can set in which can derail the timeline and ultimately cause the project to fail.

5. Who—Resources—and the right resources

• Both the correct quantum and quality of resources need to be made available to the project for it to succeed.
• The project driver/owner needs to be very solid in his/her driving role in the project, as this will reduce the volume of the naysayers’ negativity.
• Successful change must involve people—change must not be imposed (either in perception or reality). If people feel that they are truly part of the solution then they will more willingly move from being change-resistant to being supporters of the change.

6. Where—The project location

• Location is determined where the key project persons are located. Or, conversely, the project people are identified in the location where the project needs to reside, i.e., closest to the pain point or closest to those who can fix the pain.
  

Once you have answered these basic and important six questions, you will know if there is a chance of having a successful project. The “what” and the “why” are the two questions that need very strong compelling arguments to mobilize the organization through the (possibly) painful change psychology. The answers to the “how,” “when” and “who” need to all support the first two questions, otherwise failure will be highly likely.

If any of the answers do not have compelling support, the chance of project failure is high, given that the organization—made up of change-resistant people—needs to go through a painful change psychology.

Measurement, Reporting and Accountability
Now that you’ve convinced yourself and your organization that it is necessary to undergo a specific change process, it’s up to you to make sure that you make it a success. Once a project has undergone one, two or more rounds of failure, it is that much harder to get the necessary buy in to make your effort a success.

Expect obstacles to arise because, of course, they will. If they didn’t, project managers like myself would not have a job. Okay, that may be a bit of an exaggeration! To every obstacle (or problem) there is a solution; don’t compromise as you want to find the right solution that is going to fit into the context of your project. Time and budget constraints need to govern the solution to ensure that your project is within the minority of winning/successful projects.

Make sure that you have documented the CSF (critical success factors) for the project in the scoping document so that you can continually measure your project against the success factors.  Project plans (timelines), internal milestones, resource maps and regular status reporting are critical to help ensure that you have your finger on the pulse.  This is absolutely fundamental to your project’s success.

One of the most effective early warning signals to watch out for is team in-fighting.  A team which is all working together and is driven to one successful goal will remove obstacles together rather than spend their time playing the blame game. Also, people want to be part of a winning team so you can assess the health of your project by the number of people trying to join your team (a good sign) versus people anxious to be disassociated with the project and trying to jump off the project band wagon (a bad warning sign).

Wrap-up Phase
Customer feedback surveys can be undertaken in larger projects from a continual learning perspective; so that you can learn what your team did well—and not so well—and factor this into future projects.

One of the most important aspects of every project I’ve ever run includes a celebration of a successful outcome—or where necessary—celebration of achieving interim goals. This feeds huge positive energy into the change psychology which gives energy and momentum for the project to progress through future hurdles, and it’s fun!

Some Final Thoughts
Follow the above process as this will help ensure that your project ends up in the five percent—the success minority—of projects which are completed on time and within budget. It’s a lot more fun being involved with a winning effort—and don’t forget to celebrate your success!

On November 20 I will be presenting a webcast on this topic, and will include a detailed actuarial example so that this process can be translated into a change effort that you can relate to.  Learn more about that session and register here.

Doris W. Orr, CA, is SVP project director for XL Capital. Her passion is to add value and to help others get excited about adding maximum value in order to ignite their career paths. Through experience gained from running many projects—both large and small—and from working abroad for various years, Doris provides practical insights on how to increase your value—one second at a time. Along with her November webcast, she will also be repeating her popular session titled "Focus Your Time for Superior Results" at the SOA Annual Meeting in October. She can be reached at doris.orr@xlgroup.com.

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