First Things First
The first thing we need to do is look at the Chaos reports' definitions of success and failure. In the reports, the definitions are:
- Successful: the project is completed on time and on budget, with all the features and functions originally specified
- Challenged: the project is completed and operational, but over budget, late, and with fewer features and functions than initially specified
- Failed: the project is canceled before completion or never implemented
Let's take the failure category first. Why should project cancellation be considered a failure? In a certain number of cases, the failure label is appropriate, but in many cases, canceling a project becomes the right decision to make - and it's not a failure. What if the business conditions change? What if the technology platform changes as the result of a rapidly changing market? What if the projected scope and cost increase to the point that the project doesn't meet ROI hurdle rates anymore?
The faster the business environment changes, the less information we have when initiating projects. Waiting to gather information may enable a competitor to win market position - the project wasn't a failure because it never got started, but the business failed. Starting the project early and understanding that information learned during the project may cause us to cancel it at some point is part of risk management. Those that never cancel a project, never take risks. Those that don't take risks won't survive. This isn't failure; this is simply good management.