The Facts of Project Failure
Updated: Mar 4, 2021
Project are generally considered a 100% success when the project fulfils what it set out to do on time and in budget. However, whilst some products might take longer or go slightly over budget, others can accrue a massive cost or never reach completion at all.
We’re taking a look at some project failure statistics to truly understand how many projects fail, why and the real cost of a failing project.
Some more recent statistics from the Project Management Institute suggest project performance is improving.
1. In 2018, nearly 70% of projects achieved their original goals, while nearly 60% were completed within the original budget. Both these figures are up from 62% and 50% respectively in 2016.
2. In between 2013 and 2018, there was a 27% decrease in the amount of money businesses were wasting due to poor project performance.
However, other shocking statistics reveal that this isn't the whole story.
3. 70% of organisations have suffered at least one project failure in the 12 months prior.
4. 50% of respondents indicated that their project failed to consistently achieve what they set out to achieve.
5. A PwC study of over 10,640 projects found that only 2.5% of companies complete their projects 100% successfully.
6. Most organisations have a project failure rate of 70%, the main reason for this failure being poor project management.
Evidently, project failure of some form is a common experience for many, but why do these projects fail?
7. The most common factor behind project failure, with 37%, is a lack of clear goals, according to PMI.
8. Poorly trained project managers, attempting too many projects, and a lack of project funding are the top three project management challenges in Wellingtone’s survey.
9. One study suggests that 57% of projects fail due to breakdown in communications.
Whatever the reason for a failing project, it can be difficult to gauge the real cost to your business, especially with large projects.
10. A survey published in HBR shows that the average IT project went over budget by 27%. Moreover, at least one in six IT projects has a cost overrun by 200% and a schedule overrun by 70%, earning it the name "black swan".
However, the cost is not only financial. It's important to remember the other costs to your business that arise from a failing project, including the impact on your team.
If you want to know the real cost of your failing project, check out our calculator on our website here!