Understanding Project Success: Perspectives from Different Stakeholder Groups

Sep 5, 2024 | Project Management

Understanding Project Success: Perspectives from Different Stakeholder Groups

Sep 2024 | Project Management

Understanding and aligning different stakeholder perspectives is crucial for achieving project success. This study explores how varying interpretations of project success criteria among senior management, project teams, and recipients can lead to project failure. A multiple stakeholder model is proposed to enhance collaboration and reduce the risk of unsuccessful outcomes.

Project management is a critical operational tool that organizations use to handle customized, one-off events across various functions. The effectiveness of project management lies in its ability to manage resources, tasks, activities, and associated timelines. However, project success is not uniformly defined, which has led to a high rate of perceived project failures. A study published in the International Journal of Project Management highlights that project failure often results from differing interpretations of success criteria among multiple stakeholder groups. This article aims to delve into these perceptions, examining how aligning stakeholder views can minimize project failure and enhance successful project outcomes.

Background on Project Success and Stakeholder Perspectives

Historically, project success has been measured using various instruments and methods, with Pinto and Slevin’s (1987) ‘diagnostic behavioral instrument’ being one of the most cited tools. However, this tool and others like it primarily focus on the project manager’s perspective, often neglecting the views of other key stakeholders such as senior management, the project core team, and project recipients. This oversight can lead to a misalignment in expectations and outcomes, contributing to the perception of project failure.

The Importance of Stakeholder Alignment in Project Success

The failure of projects is a common concern in project management. For instance, the Standish Group (2012) found that 18% of projects fail outright, while 43% are challenged. KPMG (2013) reported similar findings, noting that only 33% of projects were completed on budget, 29% on time, and 35% to scope. These statistics highlight the need for a more inclusive approach to defining project success—one that incorporates the perspectives of all relevant stakeholder groups. By understanding and aligning the different views on what constitutes project success, organizations can reduce the likelihood of project failure.

Key Findings from the Study

1. Diverse Stakeholder Perceptions

The study identified communication as a common theme across five stakeholder groups (project manager, client, owner, user, and project team). However, the emphasis on other success dimensions varied among these groups. For example, project managers and users valued time, cost, and stakeholder satisfaction, while senior management focused on strategic benefits and top management support.

2. Lack of Common Success Dimensions

The absence of shared success dimensions among certain stakeholder groups, particularly between senior management and project recipients, was a significant finding. This lack of commonality suggests that different stakeholders may prioritize different project outcomes, leading to misaligned expectations and perceptions of success.

3. Impact of Project Phases on Success Perceptions

Stakeholders’ perceptions of success change throughout the project lifecycle. Clients, for instance, become more aware of their needs as the project progresses, which can result in conflicting requirements between them and project sponsors who set the initial project scope.

4. New Dimensions for Measuring Success

The study proposed new dimensions to measure project success, taking into account benefits to the stakeholder group, client/customer-specific issues, and the traditional metrics of time, cost, and quality.

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Project Completion

According to the Standish Group’s 2012 CHAOS Report, only 39% of projects are considered successful, 43% challenged, 18% failing. Source: Standish Group, 2012 CHAOS Report

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Project Completion

A McKinsey & Company report found that large IT projects run 45% over budget and 7% over time, while delivering 56% less value than predicted. Source: McKinsey & Company, 2012

The Role of Senior Management and Project Teams

The study emphasized the critical role of senior management in defining and supporting project success. Senior management’s involvement is crucial in setting realistic goals, allocating resources, and providing top management support. Similarly, the project core team’s engagement ensures that the project is executed effectively, with attention to detail and a focus on meeting project objectives.

Developing a Multiple Stakeholder Model

A key outcome of the study was the proposal of a multiple stakeholder model that considers the diverse views of different stakeholder groups. This model aims to enhance the dynamic engagement of stakeholders, allowing for continuous collaboration, capturing changing priorities, and facilitating effective communication. By doing so, organizations can ensure that project success criteria are aligned with the expectations of all stakeholders, leading to more successful project outcomes.

Conclusion

Future Research Directions

Future research should continue to explore the perceptions of project success across a broader range of industries and project types. Additionally, empirical studies should be conducted to validate the proposed multiple stakeholder model and to refine the success dimensions identified. By doing so, project management as a discipline can develop more inclusive and effective strategies for managing complex projects, ultimately leading to higher rates of success and satisfaction among all stakeholders.

Conclusion

The study’s findings underline the need for a more holistic approach to project management—one that incorporates the perspectives of all relevant stakeholders. By understanding and addressing the different success dimensions valued by various stakeholder groups, organizations can minimize project failure rates and achieve more consistent project success. This approach not only aligns project outcomes with stakeholder expectations but also fosters a more collaborative and motivated project environment.

References

  • Davis, K. (2017). An empirical investigation into different stakeholder groups’ perception of project success. International Journal of Project Management, 35(5), 604-617.
  • Standish Group. (2012). Chaos Report. Standish Group International.
  • KPMG. (2013). Project Management Survey Report. KPMG, New Zealand.
  • Pinto, J.K., & Slevin, D.P. (1987). Critical factors in successful project implementation. IEEE Transactions on Engineering Management, EM-34(1), 22-27.

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