01 Dec Project Management Statistics: Trends and Common Mistakes in 2023
Project management doesn’t come cheap—it takes up to 20% of the overall project budget. Running a project without solid management, or bad project management, however, will do more harm than good.
That’s why we’ve put together the most important project management statistics to help you paint a clearer picture of the PM performance rate but also understand why projects fail, what factors are crucial to success, and more. So, read on to learn all about project management, and most importantly, why you can’t afford to overlook this process.
Top Project Management Statistics: Editor’s Choice
- 70% of all projects fail.
- 42% of companies don’t understand the need or importance of project management.
- 55% of project managers cite budget overrun as a reason for project failure.
- The project management industry is set to grow by $6.6 trillion by the end of 2020.
- Stakeholder engagement is the most valuable PM process.
- 62% of successfully completed projects had supportive sponsors
General Project Management Statistics & Facts
1. 70% of projects fail.
The percentage of projects that fail is fairly high—a whopping 70% of all projects fail to deliver what was promised to customers. The implementation of a management process, however, is shown to reduce the failure rate to 20% or below.
2. Organizations that undervalue project management see 50% more of their projects failing.
Project management statistics show that in 2018 organizations that overlooked the PM process reported failure of half or more of their projects. This means huge financial losses, along with potential missed business opportunities and lost clients.
3. 9.9% of Every Dollar is wasted due to poor performance.
Nearly every 10 seconds, $1 million is wasted by companies worldwide as a result of the ineffective implementation of business strategy. This results in approximately $2 trillion a year.
4. 42% of Companies don’t understand the need or importance of project management.
The latest project management stats show that 58% of organizations fully understand the value of implementing project management as a way to achieve better performance. This means that 42% of companies undervalue the importance of project management as a crucial component for project success.
5. Projects are 2.5 times more successful when PM practices are implemented.
Undoubtedly, robust project management improves the chances for success, drives cost-saving, and risk reduction. The Pulse project management statistics show that high-performing organizations with proven PM practices in place have met their original goals 2.5 times more often (89% vs. 34%).
6. Organizations that Invest in PM practices waste 28 times less money.
Investing in proven project management practices reduces wasted financial resources by 28 times. This reduction comes as a result of successfully completing a larger proportion of their strategic initiatives.
Project Failure Statistics
7. A lack of clear goals is the most common factor (37%) for project failure
Setting clear goals helps you to track the milestones and the progress, giving you a clear picture of where you are at the moment. Thanks to this data you can make some tweaks or reinforce the practices that benefit your end goal.
8. 75% of respondents in the IT industry lack confidence in project success.
IT project failure statistics show that 75% of respondents think their projects are always or usually doomed to fail from the start. Out of this 75%, 27% constantly feel this way. At the same time, the majority of respondents (80%) have admitted to spending half their time reshaping the projects.
9. 44% of projects fail due to a lack of alignment between business and project objectives.
As software project failure statistics show, the lack of alignment of projects with the business objectives is the reason why nearly half of the strategic initiatives fail. The lack of alignment results in less organizational agility which leaves businesses unable to reach strategic shifts in customer demands, leverage the expected economic growth, and mitigate losses.
10. 55% of project managers cite budget overruns as a reason for project failure.
Over half of project managers consider budget overruns the main reason for project failure. This is often due to unforeseen events that go beyond human control. Reducing cost overruns systematically, therefore, should be a priority for project managers. Proper planning and good software can help with this.
11. More than half of construction project owners have experienced at least one underperforming project.
Construction project failure statistics show that over 50% of construction project owners worldwide (and 61% in the US) have seen their projects failing despite the confidence in project planning and controls. They have further reported that only 31% of their projects were delivered within 10% of the budget and 25% within 10% of the original timeframe.
12. 41% of underperformers say inadequate sponsor support is the main reason for project failure.
Effective project sponsors provide consistent engagement and support which is crucial to project success. 41% of underperformers and 17% of high performers report inadequate sponsor support as the main reason for failure, according to project management failure statistics.
Organizations with a higher percentage (more than 80%) actively engaged sponsors to have 40% more successful projects than organizations with a lower percentage of projects (less than 50%) with sponsors.
13. Coca-Cola wasted $4 million in development and another $30 million in back stocked products after releasing New Coke.
The attempt of Coca-Cola to introduce New Coke in 1985 is one of the most popular poor project management examples. Instead of conducting in-depth marketing research, the team administered more than 200,000 taste tests to confirm that the subjects liked the taste of New Coke more than the classic one and Pepsi. As it turned out, consumers hated it and Coca-Cola learned a very important lesson — every project needs proper management.
Conclusion
Customers and stakeholders’ expectations will continuously change during the project completion process, making it difficult to achieve project goals. These project management statistics have hopefully helped you understand that proper management is the key to decreasing the failure rate — make some notes and get ready to nail your next project.
Sources
https://teamstage.io/project-management-statistics/
4PM, PMI 2018, PMI 2016, CIO, G2, Geneca, PMI 2014, PMI 2017
KPMG, Business2Community, PMI, Wellingtone, Agile247, Mordor Intelligence, Datanyze, Business First Family
PMI, Wellingtone
Wrike
Business2Community
Workamajig