Project failures are legendary in business. Every leader has experienced at least one project that was expected to be transformative but turned out to be a failure or accomplished little to nothing. Never mind that most projects tend to go over budget and take far longer to implement than expected. So, how do you choose which projects to pursue and ensure they provide value to your organization?
A typical approach usually involves management using some amorphous decision making to select some projects it wants to pursue. These projects usually satisfy some perceived competitive advantage need. However, more often they usually just check a box so management can say it is pursuing the latest fad (think machine learning or AI, for example). These projects are put into a prioritization scatterplot based on the perceived value of the project relative to its cost or complexity. Projects are then selected based on which one’s management thinks are achievable and will provide the most value. Not exactly a robust or optimal approach. A better approach involves a bit more effort but it has a much higher rate of success.
First, management should collect project ideas from a variety of sources throughout the organization. Rather than relying on senior management intuition only, canvasing all layers of the organization provides greater insights and opportunities to identify projects that provide significant value to the organization. This approach identifies a range of projects, small and large, and helps identify potential implementation dependencies or organizational issues.
Second, adopt a shorter horizon for projects. Identify potential projects that can be implemented more quickly. A five year horizon is simply too far in the future. Who knows what the market will be like in five years? A one to two year horizon is better. This is not to suggest that you should not tackle long-term, transformation projects. Rather, chunk projects into short-term deliverables with the flexibility to adjust as market dynamics change.
Finally, consider the interrelationships of projects. Projects are not implemented in silos. They have potential impacts across the organization. By identifying complementary projects, you are able to tackle precursor projects that make implementing other projects easier. Develop shared components that may be used across a range of projects. This approach reduces the cost of individual projects and makes seemingly lower-value projects more attractive.
Canvassing the entire organization instead of relying solely on executive leadership helps identify a range of appropriate projects. This avoids potential pitfalls and dependencies across the organization. Selecting a shorter time horizon for projects allows you to remain adaptable to market forces. You will also be able to adjust should projects prove less desirable or more problematic. Considering the interrelationships of projects allow you play one project off of another. This reduces risk and improves the overall value of individual projects. Taking this overall approach will help you choose projects well.