How to Avoid Project Failure with Best Practices
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How to Avoid Project Failure with Best Practices

Following best practices can improve project performance in planning, execution, risk management, and communication. This increases the chances of success and avoids costly mistakes.

Every project manager wants their projects to be successful. But what does it take to achieve project success? There are many factors that contribute to project success, but one of the most important is following best practices.

Best practices are the tried-and-true methods that have been shown to improve project performance. They can cover a wide range of areas, from project planning and execution to risk management and communication.

When project managers follow best practices, they are more likely to deliver projects on time, within budget, and to the required quality standards. They are also more likely to avoid costly mistakes and setbacks.

In this article, we will discuss some of the best practices that can improve project performance. We will also provide tips on how to implement these practices in your own projects.

To have a successful construction project, clients and contractors must work closely together and plan for the future. Building a strong partnership is crucial for achieving this goal.

Organizers of the 2012 Olympics can learn from successful buildings like Terminal 5 at London's Heathrow Airport in terms of risk management, as cost and time overruns pose a significant risk for big construction projects. The estimated cost of the 2012 Olympics has risen from an initial £2.4 billion to £9.35 billion. The construction budget is now set at £5.3 billion with a £2.7 billion contingency fund. Stuart Pemble, a partner at Mills and Reeve L.L.P. in Birmingham, England, says that cost and time overruns are always a concern for construction projects and are the main risks for the 2012 Olympics. However, the Olympics has a fixed completion date, which requires the Olympic Delivery Authority to be flexible in other areas. Paul Hopkin, technical manager of the Association of Insurance and Risk Managers in London, notes that the Olympic Delivery Authority should focus on construction project procurement to avoid these risks. Laurence Gilmore, construction and account director of Aon Ltd. in London, emphasizes the importance of "partnering," which aims to move away from traditional adversarial relationships between clients and contractors in favor of a more collaborative approach. Terminal 5 at Heathrow Airport is regarded as an example of good project risk management in the construction industry, as it acknowledges the need to work together and to avoid a culture of blame and risk.

Project principles

The agreement for Terminal 5 was based on project management principles outlined in two reports commissioned by the government in the mid-1990s. These reports were Constructing the Team by Sir Michael Latham in 1994 and Rethinking Construction by Sir John Egan in 1998. According to the Terminal 5 agreement, BAA assumes all the risks associated with the construction project, and there is a focus on delivering solutions and results. This is achieved through a project incentive fund that aims to balance the successes and failures of individual contractors. Contractors are rewarded for completing work on time and within budget. Experts consider the Terminal 5 agreement to be successful because the client bears the time and cost consequences in the form of a project insurance policy. Additionally, the project pool was efficient, and the incentives given to the contractors worked well. Had BAA followed the traditional contract approach, Terminal 5 would have been two years late and 40% over budget. This information comes from Mathew Riley, the commercial director for Terminal 5 at BAA, in an interview published in issue 31 of the newsletter from Turner & Townsend, a construction management consultant based in Leeds, England. The ODA's goal is to ensure that contracts are suitably drafted to promote partnering, defined levels of retained risks, and triggers for reward for defined performance levels in the execution of the works. Robin Baines, the director of construction risks at London-based Willis Insurance Holdings Ltd., said this in an email. The form of contract used on the Wembley Stadium project resulted in litigation between clients and contractors due to time and cost overruns. This is because it was a "fixed price" agreement, which places the contractor at higher risk and can encourage a culture of blame. According to experts, trying to shift risk is difficult, and designing a commercial contract that allows one party to win over another can lead to legal disputes. If disagreements over contractual obligations arise, it is essential to have evidence to support any claims. Claims can become complicated due to the vast paper trail associated with large contracts and projects. The problem for the Olympic organizers is that regular users of the system are more used to playing this game. This is perhaps one area where experienced project partners could help, according to Mr. Pemble.

Constant involvement

According to Mr. Ure, the success of BAA's Terminal 5 project was due to high levels of expertise on the client side and continual assessments through constant involvement in the project. Mr. Ure noted that BAA invests strongly in a lot of expertise to manage and be heavily involved in each of the individual subprojects. He also added that their good partnership model is underpinned by their great involvement and continuing ownership of the project. BAA had to recruit more project managers on their side, which reflects their continual reviewing of requirements and needs of their involvement. The organizers of the 2012 Olympics have agreed to the 2012 construction commitments, which were drafted by the Strategic Forum for Construction, a UK construction industry body. The Olympics commitment charter is a good framework that encourages good practice for a large construction project, according to a spokesman for the Strategic Forum. Land acquisition was completed during the summer for the more than 750-acre London site that is to host the 2012 Olympic Games. Some 200 businesses and more than 400 residents had to move to make way for building the Olympics stadium, athletes' village, and other sports facilities. Chief Executive of the London Development Agency, Manny Lewis, said in a July statement that they have helped businesses find new sites and so far safeguarded 98% of jobs. An Olympic inspection team visited the O2 Arena in April 2006. O2, which opened in July of that year, is to host gymnastic and basketball finals in the 2012 London Olympic Games.