Project ROI – Can you do better?

Labor Day – The height of construction season for some, a winding-down point for others.  Is your portfolio of projects producing the bottom line you need? Are things going as bid?  Projects on-time, close to budget?

The answers lie in the proper application of a combination of standardized, best-practice project management processes and related technology implemented on an enterprise basis, such as the Primavera family of project management solutions, allowing timely project performance visibility and true collaboration on a company-wide basis.  In today’s competitive economic environment, these aspects are no longer an option – they have become a necessity for long term growth and prosperity.

The benefits of adoption are borne out when reviewing Aberdeen Group’s 2010 Project Management Report – “Standardized Best Practices and Technology Adoption in the AEC Industry” – January, 2010, and extrapolating the findings to your organizational situation and practices.

We have included pertinent references to the Best Practices and Technology Improve Performance section of the report – summarized and/or paraphrased – here for your convenience.  The full report may be accessed at http://www.oracle.com/us/2010-project-management-report-069877.pdf

In researching their findings for Architecture, Engineering and Construction firms, Aberdeen created three categories of AEC firms based on the extent of adoption of standardized best project management practices and enterprise level technology.

The first category of top performing companies utilize defined, documented and standardized best-practice project management processes and have implemented enterprise technology – implemented on an enterprise basis – that enables the insight and controls to deliver projects early or on time and within budget.  For those projects with time or cost overruns, the combined processes minimize the negative impacts significantly. The average firm in this bracket achieved:

• 89% of projects delivered early or on time
• Projects not delivered on time are on average four weeks late
• 89% of projects delivered within budget
• 10% average overrun on those projects not delivered within budget

The second category of AEC firms utilize defined and standardized practice project management processes, however, the technology is limited to desktop tools, spreadsheets or manual processes. The average firm in this bracket achieved:

• 71% of projects delivered early or on time
• Projects not delivered on time are on average six weeks late
• 79% of projects delivered within budget
• 14% average overrun on projects not delivered within budget

The third category consists of firms that may utilize best practices on a project-by-project basis, but not on a company-wide basis.  Technology resides solely on the desktop/laptop, severely limiting project visibility and collaboration.  The average firm in this bracket achieved:

• 64% of projects delivered early or on time
• Projects not delivered on time are on average six weeks late
• 73% of projects delivered within budget
• 20% average overrun on projects not delivered within budget

As the data above indicates, there are significant differences when standardized best project management processes and enterprise applications are not utilized in a true enterprise fashion to provide not only true project portfolio visibility and team collaboration, but also add substantially to corporate financial performance.   As budgets remain tight and project execution becomes critical, can you afford not to adopt such a holistic approach?

Are you planning for next season yet?

As the 2012 season wraps up, it is prime time to consider the funding of adjustments or refinements to your Project Management and technology approach, whether it is utilization of year-end monies or adequate budgeting for next fiscal year.