Why projects fail

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This area of the site was written for very experienced trust fundraisers.

Surveys of project managers

There are many surveys of project managers about why projects fail. As with many things of potential interest to us, you could easily argue about how representative they are for our sector. A lot of project managers work in two industries: IT and construction! That said, people are people, institutional dynamics seem to have some things in common everywhere and so I don’t think the surveys are irrelevant.

Over the years I haven’t seen a lot of projects fail in a big way, though more HAVE fallen short. So, I was going to use the more obviously relevant headings as inspiration to make some points:

Lack of “sponsor” involvement

A “sponsor” in project management jargon is the senior manager who owns the project and provides resources and support for the project. Serious problems can easily originate here: senior management stopping caring about fundraising in the face of other changes has caused me a number of serious issues over the years: not being able to get project bids out of the building that were supposed signed up for; issues getting projects back on track that ran into trouble in terms of delivery; problems negotiating a good solution when the Service manager wanted to change the project from that agreed with the funder. 

Commonly, before losing the involvement of the “sponsor”, there’s been increasing distance from them in the preceding period. 

It’s no accident that so many of the pages in the working with Services and other sections go on about influencing senior Services staff. Although you may not see it, senior staff may do more for your project than just giving it the okay for fundraising.

Poor estimates

Most cost estimates in our sector are controllable, because most are staff costs. I’ve had a lot more work to agree uses of under-spends than trying to deal with projects having too little money. 

The one area with horrible budget overrun issues has been capital projects:

• Building inflation is such that it is easy for the budgets to be unrealistic and redoing costs can cost the charity money. You need to push people to ensure the costs and timescales. are as realistic in terms of timings/inflation and free from wishful thinking as possible
• Refurbishments are significantly less predictable in terms of costs than new builds, because you don’t know what will happen until it does.

Over optimism

I’ve written a lot about the value of being conservative in the targets you set. It’s on the Outcomes webpage under the proposal sections sub-menu.

The same general point applies whenever you think your Services team is being over optimistic. Donor retention is very important (either now or in creating lapsed donors with an interest in giving again soon). A lot of the time, for me, it will trump the benefits of creating an exciting impression through very high delivery. 

Poor internal communications

I drafted this in the throes of the pandemic. After 15 months of COVID, at my current charity, my team was still discovering how much effective communication with Services mattered. Problems we had not seen in the earlier months had emerged at the end of the year. It became clearer how exactly Services were really approaching things. It became clearer how different some of our assumptions were from Services, in ways that might not have mattered when things were small but did when factored up across multiple projects and large numbers of service users. It brought home that, in a new and changing situation, I couldn’t take clear communications for granted.

I’m sure I don’t need to highlight the issues around communication for the audience of this website.

Poor alignment with organisational mission

Projects that are original and a bit “out there” for the organisation are good fun. They’re one instance where the organisation’s more likely to turn to the Trusts team for funding. However, they’re also vulnerable to failure:

• If something goes wrong, there may not be either the skills or the enthusiasm to sort it out. I’ve sometimes felt, “It’s just me and the Services manager here”.
• They can be very dependent on the skills and drive of one person, who may leave.

You need to take this into account a bit in the fundraising feasibility study for the project. Trust assessors may realize the risk, too.

The minute you hear of significant organisational changes, you should think, “Do I need to do anything to ensure my project is still okay?” As soon as you hear that the key person is leaving, you need to think: “The charity will be planning what’s next. How do I get internal commitments to ensure the project stays strong?”

“Scope creep”

This is more something that happens after the grant has been awarded: the organisation changes its policy and tries to bolt extra things onto the project to fit the new approach. Before you just approach the trust about the change, you need to do some proper analysis of the situation. Use the techniques in the “Dealing with changes” section of the Day-to-day grant management web page. The “futures wheel” is a good tool to think things through. 

It might be that there’s no alternative and the project has to “fail” in the sense of no longer delivering on its original brief. However, it’s important to know what you’re getting yourself into.

Lack of resources

This is a somewhat easier one for assessors to spot, where you’ve tried to pile too much into the project model. I’ve seen it as a rejection reason.

Inexperience in project management

There’s a reason why there’s so much on this site about how to develop a project and how to develop a big, complex bid! It’s not easy.

Likewise, it’s well worth paying a bit more attention to projects where the people involved are out of their depth. 

I can think of at least three IT-led initiatives (an area where the Services teams were very unfamiliar) where halfway through the development of the project it turned out they were using completely an unsuitable IT system for their purposes. If it’s possible to bring in outside expertise, e.g., pro bono, or maybe with a bit of money from the grant, there’s a case for it.

Creating a small contract to provide expertise is a relatively easy “fix” you can build into the work and sometimes your charity knows someone who can partner you for a few £k to advise. As project management guru Ricardo Vargas highlights, though, contracting in expertise leaves you in the same situation at the end. So, if it’s not a short term need there may be a case for some knowledge transfer built into the partnership.

Focusing specifically on project management expertise: staff who are great at delivering online services don’t necessarily understand how to manage change. If the pandemic has shown one thing, it’s that a team that can easily handle gentle improvements to business as usual will need different knowledge and skills to handle wholescale innovation. It can take time for this to become apparent, so you need to stay in communication with staff whose background hasn’t involved a lot of change.

Poorly defined goals/objectives

I haven’t seen this so often. However, with innovative projects, people can learn what they’re doing as they go along and the initial targets can be set more as “management targets” (i.e., “we need a direction”) rather than as what the team really hope to achieve. If you can’t sense that that’s what Services are doing, you’re going to be in trouble later on when they try and head in a new direction with the funded work!

I think this comes to a fundamental problem with the methodology of trust when dealing with innovative work. If you know anything about Agile project management, which is what you use in changing, innovative fields like IT, you’ll know it involves fixing the times and budget but leaving the scope of the project fairly broad. There are regular reviews and the work is allowed to keep evolving. 

That couldn’t be more different to normal proposals, where you are defining what will happen over maybe the next three years and where trusts can reject you for “lack of clarity”. When we talk to a typical generalist trust about needs and benefits, we’re promising to change the world in certain ways (that they can compare with other changes) and then we show we’re a safe pair of hands to deliver that change. There’s nothing exploratory about all that.

I can think of one example from a very innovative area of work, where the bids set out very clear objectives but the commitment internally really was just to “doing something in this new field of work”. From a fundraising point of view the project was an utter disaster: it went off in a different direction to the intended one and then, because the people were learning as they went along, it then lurched in a completely different direction. It was very difficult to explain all this to the funders, fundamentally because it was stupid.

However, in retrospect we might have got (somewhat) further by being open and using the right language:

• Focusing on the fact that this was exploratory work, which therefore offered far greater impacts in terms of disseminated knowledge than the tangible impacts we were promising in the proposal.
• Highlighting that the targets were management targets, rather than promises to deliver particular outcomes. As well as providing the project a clear direction to go in, they provided a sense of the scale of the change we expected to offer, though the detail could change in practice as we explored this new field of work.

That might not have attracted so much money from our conservative funders (though it’s not terrible, being “real world” in highlighting the unknowns is an attractive quality in an applicant) but it wouldn’t have risked alienating funders. Keeping the whole thing honest and real is also good for all involved.

Poor risk management

There are two approaches projects can take to risk: (1) trying to predict and control for risk; and (2) dealing with issues if they occur. The problem in our sector is that insufficient time is often given to the development of the project and then the manager who starts the new project is relatively inexperienced in new work (and of course, fundraising isn’t taken as seriously and we’ve kind of moved on from developing their project).

So, what happens is that risk management isn’t necessarily done in a formal way. There’s also the problem that risk isn’t that well understood in some parts of Services, who think of it in terms of health and safety/safeguarding risks and similar issues, rather than: what could happen that stops our project really delivering?

It’s worth at least highlighting the research in this area to the lucky Services manager who’s holding the keys to this new project: if they do a decent risk analysis and risk management plan now and implement it, the chance of failure is lower. It’s up to them what they do, but at least you’ve tried.

Issues understanding the service or issues understanding the “market”?

Research has found that gaps in understanding the market as more likely to scupper new companies’ initiative than issues not understanding the service itself. 

You can see how that might be an issue for our sector. It’s normally easier to get up to speed on the service, whereas understanding a new group of service users or referral partners is harder and if they have to do plenty for you to deliver, this will matter.

Sustaining or disruptive innovations?

This is one that isn’t in the above survey, but it’s an important distinction. It’s not that hard, normally, to get right “sustaining innovations” – innovations that breathe more life into an existing model of work. However, it’s much harder to get right “disruptive innovations” – those that try to radically change things. 

The vast majority of new businesses fail and the normal reason is, fundamentally, that they’re trying to change things, moving into areas that aren’t well understood. Particularly hard to predict is what “customers” – in our sense, service users, or maybe key external partners – are going to do.

Resources

The Why do projects fail? Web site has a great list and some amazing disasters. (If you thought your charity was the only one to mess up, you’ll find that its mistakes are VERY small fry compared to those of some institutions!)

The Blunders of our Governments by Anthony King and Ivor Crewe is fairly light reading as project management texts go and it’s a page turner. 

Complex projects are particularly likely to go wrong. Terry Cooke-Davies’ Aspects of Complexity: Managing Projects in a Complex World Analyses what goes wrong (as well as coming up with some ideas to help. Garvey Berger and Johnson’s Simple Habits for Complex Times is another well regarded book that has practical advice that could be applied).