PROJECT SUCCESS RATE
Project managers typically calculate project success rate largely based on the extent to which
they delivered the project within schedule, budget and scope. Portfolio managers calculate it
as the percentage of projects in the portfolio that delivered the promised benefits.
“If you measure project success based on scope, schedule and budget, then you can say,
‘These projects were successful because they delivered on time, for the right amount of money,
and they delivered the required functionality,’” Mr. Dochtermann explains. “But let’s say you
did the wrong project. You did it right, but the impact it had was relatively small to the busi-
ness. For that reason, success rate has to be tied not just to the project’s success, but to the
Project success rate is closely related to business value realized, with one important differ-
ence: The former encapsulates success, while the latter quantifies it. In both cases, “success”
must be clearly defined.
“Before you can measure success rate you need to make a clear point of what success is,”
Mr. Vargas says. “If you’re building a road, for instance, what is a nice road? Are you talking
about a five-lane, high-speed highway or a non-paved local road just to connect two remote
villages? Because expectations are quite different.”
“Strategic objectives should be listed and mapped to the main business capabilities within a portfolio. Each project will then be aligned to improving a specific capability....A project should then deliver against a capability to increase the maturity of that capability.” —Marna Schoeman, PMP, Standard Bank Group, Johannesburg, South Africa
For a portfolio to truly help an organization succeed, the projects and programs it contains
must align with strategic goals.
“At Bank of America, we’re not allowed to do projects unless they align with corporate
and divisional objectives,” Ms. Baker says.
Alignment with strategic objectives tells portfolio managers and executive stakeholders
the percentage of projects in their portfolio that are in sync with at least one of the organization’s strategic objectives. This measurement ensures that project teams are focused only on
work that advances the organization’s progress toward stated goals. Work that doesn’t—even
if it delivers business value—is deemed out of alignment.
“Strategic objectives should be listed and mapped to the main business capabilities
within a portfolio,” Ms. Schoeman explains. “Each project will then be aligned to improving
a specific capability, which will reflect on alignment of the portfolio to achieve the strategic
objectives of the business unit. A project should then deliver against a capability to increase
the maturity of that capability.”