You must lead the entire business case
You think project cost overrun is expensive? Try delay and reduced impact!
We carry out projects in order to achieve an impact. So it seems like a paradox that the only focus has been on deliverables. Basis has been the project triangle: Deliverables, time and resources. The idea that you can adjust the deliverables in order to achieve the desired impact is spreading slowly but the transition is quite painful.
The blue picture depicts the project business case in three situations which impairs the business case. If the project budget is overrun you can see it in the budget follow-up whereas loss by delay or less impact is invisible in a traditional project follow-up. Unfortunately this kind of loss is more important for the business case than the project budget.
If the project business case is good the expenditure issue will inevitably be much much smaller than the effect issue. There is absolutely no doubt that the impact issue is the most interesting part of the business case. My claim is that project managers and steering committee members don’t view the project as being the entire business case – the project is done when the deliverables are in place. They don’t act as if they are responsible for the entire business case.
By no means I am advocating for economic stupor, but a budget overrun of 30% is less important to the business case than a 10% deterioration in the impact. If this is not a fact the business case is actually lousy and the project should never have been launched!
Six cheeky ones:
- If the business case is not self-evident – drop the project!
- The project triangle should comprise impact, deadline and resources.
- Adjust the deliverables in order to secure the effect – measure the impact.
- Use the necessary resources in order to reach deadline – deadline is God.
- Deteriorated impact and delay is much worse than budget overruns.
- The project is not over until the impact is in the bag.
