Analysis of Project Success Criteria and Success Factors
By Dimitrios Litsikakis
We often hear or read about various success stories. But what is success and what criteria should organizations use to identify success? What factors lead to a successful project? The purpose of this article is to define project success criteria, clarify their difference with success factors and analyse their importance in project management methodology.
One of the vaguest concepts of project management is project success. Since each individual or group of people who are involved in a project have different needs and expectations, it is very unsurprising that they interpret project success in their own way of understanding (Cleland & Ireland, 2004, p2). “For those involved with a project, project success is normally thought of as the achievement of some pre-determined project goals” (Lim & Mohamed, 1999, p244) while the general public has different views, commonly based on user satisfaction. A classic example of different perspective of successful project is the Sydney Opera House project (Thomsett, 2002), which went 16 times over budget and took 4 times more to finish than originally planned. But the final impact that the Opera House created was so big that no one remembers the original missed goals. The project was a big success for the people and at the same time a big failure from the project management perspective. On the other hand, the Millennium Dome in London was a project on time and on budget but in the eyes of the British people was considered a failure because it didn’t deliver the awe and glamour that it was supposed to generate (Cammack, 2005). “In the same way that quality requires both conformance to the specifications and fitness for use, project success requires a combination of product success (service, result, or outcome) and project management success” (Duncan, 2004).
The difference between criteria and factors is fuzzy for many people. The Cambridge Advanced Learner’s Dictionary describes a criterion as “a standard by which you judge, decide about or deal with something” while a factor is explained as “a fact or situation which influences the result of something”. Lim & Mohamed applied those definitions to project success and illustrated the difference as show in Figure 1. It is clear now that critical factors can lead to a series of events which ultimately meet the overall success criteria of the project, so they shouldn’t be used as synonymous terms.
Many lists of success criteria have been introduced in the previous decades by various researchers. Primal success criteria have been an integrated part of project management theory given that early definitions of project management included the so called ‘Iron Triangle’ success criteria – cost, time and quality. (Atkinson, 1999, p338)
Atkinson continues that “as a discipline, project management has not really changed or developed the success measurement criteria in almost 50 years”. To meet the urgent need of modernizing the out of date success criteria, he suggest the ‘Square Route’ (figure 3) success criteria instead of the ‘Iron Triangle’, where he groups the criteria that other academics have proposed. The main change is the addition of qualitative objectives rather than quantitative, namely the benefits that different group of people can receive from the project. These benefits are seen from two perspectives, one from the organisational view and one from the stakeholders view. It is obvious that each part will have benefit differently from projects. For example one organisation can gain profit through achieving strategic goals when a project is completed and at the same time these goals have a serious environmental impact in the stakeholders’ community. This means that a successful project must bargain between the benefits of the organisation and the satisfaction of end users. The fourth corner of the ‘Square Root’ is the Information System which includes the subjects of maintainability, reliability and validity of project outcomes.
One of the “Square’s root” corners, organisational benefits, drew much attention because of it’s significance and it was further analysed. Kerzner (2001, p6) suggests three criteria from the organization perspective in order for a project to be successful. The first is that it must be completed “with minimum or mutually agreed upon scope changes”, even though stakeholders constantly have different views about projects’ results (Maylor, 2005, p288). Second, “without disturbing the main work flow of the organization” because a project has to assist organisation’s everyday operations and try to make them more efficient and effective. Finally, it should be completed “without changing the corporate culture” even though projects are “almost exclusively concerned with change – with knocking down the old and building up the new” (Baguley, 1995, p8). A project manager’s main responsibility is to make sure that he delivers change only where is necessary, otherwise he is doomed to find strong resistance from almost all organisational departments (Kerzner, 2001, p158) which ultimately could lead to project failure.
A more structured approach to project success is grouping the criteria into categories. Wideman (1996, p3-4) describes four groups, all of them time dependent: “internal project objectives (efficiency during the project), benefit to customer (effectiveness in the short term), direct contribution (in the medium term) and future opportunity (in the long term)”. The characterization of ‘time dependent’ is based on the fact that success varies with time. Looking at the future benefits of the organisation can be really difficult, because in some cases they don’t even know what they want, yet is vital to know what the project is trying to achieve after completion time so that success criteria are clearly defined in the early stages. This is quite a different approach, because the focus moves from the present success criteria to the future, in a way that a project can be unsuccessful during execution if it is judged by criteria like cost and quality, but in the long term it can turn to be a thriving story. A good example of this hypothesis is hosting the Olympic Games in Athens, Greece, which received mass criticism both during the planning period, due to delays in construction time, and when it was finished, due to huge cost. But the benefits that Greece will gain from the Olympic Games can be fully understood after 5 or maybe 10 years from the hosting year (Athens2004.com).
All the above success criteria “should be simple and attainable and, once defined, they should also be ranked according to priority” (Right Track Associates, 2003). Straightforward criteria are easy to understand by everyone involved in the project and therefore commitment is guaranteed. Unrealistic criteria can put a ‘failure’ label on many projects because of the unreachable standards, can generate low team esteem and team performance in future projects and finally generate unfair disappointment among stakeholders. As for priority issues, it is inevitable that things will go wrong and the project manager will be in a tough situation where he must make the right decision having in mind that he has to sacrifice the least important success criterion.
As mentioned earlier, “success factors are those inputs to the management system that lead directly or indirectly to the success of the project or business” (Cooke-Davies, 2002, p185). Some project managers “intuitively and informally determine their own success factors. However, if these factors are not explicitly identified and recorded, they will not become part of formal project management reporting process nor they become part of the historical project data” (Rad & Levin, 2002, p18). Belassi & Tukel (1996, p144) classified these factors into 5 distinct groups according to which element they relate to:
1.The project manager
Having a project manager is not going to guarantee the success of a project. He must have a number of skills to use during the project to guide the rest of the team to successfully complete all the objectives. In the 2001 CHAOS report (The Standish Group International, 2001, p6), business, communication, responsiveness, process, results, operational, realism and technological skills are mentioned as some of the most important skills a project manager should have to deliver success. However, more resent research by Turner and Muller (2005, p59) has concluded that “the leadership style and competence of the project manager have no impact on project success”. It is very interesting to investigate why a highly respectable professional body for project managers published such a contradictive position. A possible answer could be found in the fact that project manager’s results are difficult to prove and even more difficult to measure. If the project is successful, senior management will probably claim that all external factors were favourable. On the contrary, if it turns to be a failure, project manager easily becomes the scapegoat.
2.The project team
Project managers are very lucky if they have the option to choose their project team. More often, their team is inherited to the project from various sectors of the organisation. It is vital to have a good project team to work with, with core skills that can be evolved to core competences and capabilities for the whole organisation. All members of the project team must be committed to the success of the project and the overall mission of the company. Apart from their skills and commitment, project team members should have clear communication channels to access “both the functional manager and the project manager within a matrix organization. Effective management of this dual reporting is often a critical success factor for the project” (PMBOK Guide, 2004, p215).
3.The project itself
The type of a project underlines some factors that are important to success. For example, if a project is urgent, the critical factor in that case is time. The Wembley stadium is expected to be fully operational due to May’s 2006 FA Cup Final and that is the primary target. However, the increase of cost “that has thrown the management’s calculations out of kilter” (Evans, 2005) was not a big issue at that time. The size, value of a project and it’s uniqueness of activities can be a puzzle for the project manager who is used to planning and co-ordinating common and simple activities (Belassi & Tukel, 1996, p144).
Top management support is the principal success factor for many independent research groups (Tukel & Rom, 1998, p48) (CHAOS Report, 2001, p4) (Cleland & Ireland, 2002, p210) (Tinnirello, 2002, p14) , which means that no project can finish successfully unless the project manager secures true support from the senior or operational management. It is extremely difficult to work in a hostile environment where nobody understands the benefits that the project will deliver to the organisation. “Stakeholder management and contract strategies (number of and size of the contracts, interface between the different contracts and the management of contracts) are separate success factors which are also considered part of organization issues” (Torp, Austeng & Mengesha, 2004, p4).
5.The external environment
External environment can be the political, economic, socio-culture and technological (PEST) context in which the project is executed. Factors like the weather, work accidents or the government’s favourable or unfavourable legislation can affect the project in all of its phases. “Note that if a client is from outside the organization, he should also be considered as an external factor influencing the project performance” (Belassi & Tukel, 1996, p145). Competitors should also be accounted as external factors which can undermine project success because the original project could be overshadowed by a more glamorous and successful project launched by another organisation.
It is critical for a project manager to understand what the stakeholders consider as a successful project. In order to avoid any surprises at the end of the project, there is an urgent need to identify the different perspectives of what success means before the project goes live. It is also vital to remember that success criteria are the standards by which a project will be judged, while success factors are the facts that shape the result of projects. Success criteria have changed considerably through time and moved from the classic iron triangle’s view of time, cost and quality to a broader framework which include benefits for the organisation and user satisfaction. An additional framework to capture success criteria depending on time was also described. As for success factors, they were grouped into five distinct sets and the literature views were find to contradict on the issue of how critical a project manager is to the final success of the project. A common factor mentioned by many authors is senior management support for the project and it is recognized as one of the most important factors of all. In conclusion, early definition of success criteria can ensure an undisputed view of how the project will be judged and early detection of success factors will guarantee a safe path to deliver success.
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Dimitris Litsikakis is currently studying MSc Project Management in one of the top business schools in UK, Lancaster University. He has published a series of articles in Ne.O (New Technology Observer).