Why Projects Fail?

Working on a single project is demanding in itself, and with so many stakeholders and people involved, there is plenty of room for human error. The numbers behind average project success rate (or at least completion rate) can be discouraging: a study by PwC, which reviewed 10,640 projects from 200 companies in 30 countries and across various industries, found that only 2.5% of the companies successfully completed 100% of their projects. So, what are the key pain points when it comes to ineffective project management and how to avoid them?

Organizational structure

The aforementioned survey has found that better alignment between a company’s structure and business requirements results in higher overall project performance of the organisation. However, once a project slips out of its tracks, there will be a lot of finger pointing going around. Upper management tends to place all of the blame entirely on dedicated project managers when in fact the communication and alignment between different hierarchy levels is crucial for a steady flow of information and activity regulation of an ongoing project.

(In)competent project leads

Whether you are recruiting in house or outsourcing, your project manager needs to fit the precisely predefined skillset required for the project at stake. Due to the intricacy each industry holds, there is no universal formulation of a successful project manager, although there are some generally favored traits you should look out for when hiring. Also, make sure to prioritize candidates who have some type of project-related certification or offer your own perspective employees the chance to develop and enhance their skills for this demand. This would place you among the 40% of the companies which regularly offer a development programme to their staff.

Transparent project plan

There are not enough ways to stress out how important it is that every single person involved in a project gets familiar with his or hers responsibilities and completely understands the assigned tasks as well as deadlines. This is where an experienced project leader steps in and makes sure that the timeline is clearly defined for each stage of the process and that there is a good feedback mechanism in the organization which will prevent abrupt stops and “bottlenecks ” in any department involved.

Goals and aims

Besides understanding their individual tasks, participants must be acquainted with the overall goal the project they are working on should achieve. If your work is not result-driven, it will result in just that – nothing tangible. This is something companies are aware of, but fail to put to best practice. There are many goal setting strategies to choose from, but keep in mind, that once you’ve decided upon a course, tend to stick to it, because often switching between strategies and priorities is tiring and may cost you more than you can handle.

Resource allocation

Each organization has very limited resources at its disposal, whether they are material (equipment and facilities, for example) or non-material (manpower and know-how), so it’s no wonder that many projects fail due to insufficient funds caused by budget overruns, to highlight one of the most common reasons. Proper resource planning takes time and effort, it needs to be revised at certain touch points to ensure the project is within the given timeframe and budget restrains.

Each project is uniquely complex and requires delicate planning, execution, coordination and controlling, but there are several challenges that are likely to apply to all. The following infographic depicts some of the key reasons why projects fail and a possible solution.

Why Do Projects Fail – an infographic by Active Collab, a project management tool

Recommended Project Management Software

If you’re interested in learning more about top rated project management software, the editors at Project-Management.com actively recommend the following:

1 monday.com

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monday.com Work OS is the project management software that helps you and your team plan, execute, and track projects and workflows in one collaborative space. Manage everything from simple to complex projects more efficiently with the help of visual boards, 200+ ready-made templates, clever no-code automations, and easy integrations. In addition, custom dashboards simplify reporting, so you can evaluate your progress and make data-driven decisions.

Learn more about monday.com

2 Wrike

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Tackle complex projects with Wrike’s award-winning project management software. Break projects into simple steps, assign tasks to team members, and visualize progress with Gantt charts, Kanban boards, and calendars. Manage resource allocation and forecasting with software that’s easy to launch. Automation and AI features strip away time-consuming admin tasks so you can do the best work of your life. Streamline your practices, align your team, and ensure you hit deadlines and stay on budget.

Learn more about Wrike

3 Smartsheet

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Smartsheet is an online work execution platform empowering organizations of all sizes to plan, manage, automate, and report on work. Over 80,000 brands rely on Smartsheet for project and work management.

Learn more about Smartsheet


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