Bent Flyvbjerg knows a thing or two about project inefficiency. As an Oxford University professor and economic geographer, Flyvbjerg studies the role that big projects play in shaping and changing cities — and why so many of those projects run over budget, over time, or simply fail. Flyvbjerg’s consulted on more than 100 megaprojects (extremely large-scale, complex operations) each costing at least $1 billion. He’s also collected data on more than 16,000 projects across the globe, ranging from a multi-school development in Nepal to The Guggenheim Bilbao Museum. All together, his research paints a bleak picture. Less than 50 percent of megaprojects come in on budget. Only 9 percent come in on budget and on time. And less than 1 percent come in on budget, on time and deliver expected benefits.

“In other words: 99.5 percent of big projects fail in one way or another”

PM360 Consulting reserach shows that the failure rate of large projects with budgets exceeding US$1 million was found to be almost 50% higher than for projects with budgets below $350,000. The most frequently mentioned causes of project failure are the following:

Unclear objectives

Lack of executive sponsors

Absence of leadership,responsibility and accountability

Scope creep

Poor planning

Unrealistic expectations

lnsufficent resources

Insufficent communications

Inadequate transperancy

Lack of risk management

Continuing to pursure bad ideas

Not paying close attention to project early warning signs

11 Shocking Project Management Statistics That Cost Business Owners Millions Each Year

1. 71% failed to meet these three criteria: on time, on budget, and with satisfactory results. [source: LinkedIn]

2. The failure of IT costs the U.S. economy about $50-$150 billion annually. [source: Harvard Business Review]

3. Just 40 percent of projects at IBM meet the company’s three key goals (schedule, budget, and quality). [source: IBM]

4. 80 percent of “high-performing” projects are led by a certified project manager. [source: Wrike]

5. The failure rate of projects with budgets over $1M is 50 percent higher than the failure rate of projects with budgets below $350,000. [source: Gartner]

6. 73 percent of respondents admit that their projects are either always or usually “doomed right from the start,” including 27 percent who always feel this way. [source: Geneca]

7. Project success rates are rising. Organizations today are wasting an average of US$97 million for every US$1 billion invested. That’s a significant 20 percent decline from last year’s findings. [source: PMI]

8. 49 percent of organizations have a project management training program in place. [source: PM Solutions]

9. A majority (56 percent) of organizations have only used one project management system. [source: Capterra]

10. Just 42 percent of organizations report having high alignment of projects to organizational strategy. This lack of alignment of projects most likely contributes to the surpriseing result that nearly one half of all strategic initiativrd (44 percent) are reported as unsuccessful. [source: PMI]

11. The average overrun was 27 percent, but one in six projects had a cost overrun of 200% on average ad a schedule overrun of almost 70 percent. [source: Harvard Business Review]

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