How we can help Statistics – Project Success/Failure Rates

www.pwc.com/sg
Statistics – Project Success/Failure Rates
How we can help
Did you know what research and survey data tells us about project success rate.
Through the PwC integrated risk management framework, we are well
positioned to help you. Our framework defines the key project stakeholders
across the enterprise and defines their roles and responsibilities and objectives
in relation to various project risk considerations over the project life cycle.
84%
65%
71%
17%
of projects do not meet all criteria
for success.
(Standish Group)
of companies report that system
projects do not deliver expected business benefits.
(PwC Global Survey on State of Project Management)
20%
of ERP projects do not meet the
expectations of senior management.
(CSC Index/AMA Survey)
02%
of IT projects go so bad that they
can threaten the very existence of a company
(McKinsey–Oxford)
of ERP implementation projects
are not completed.
(Gartner)
of companies had 100% of their
projects on time, within budget, to scope and delivering the right business benefits.
(PwC Global Survey on State of Project Management)
PMO
Independent
risk
analysis
Some of the more common and recently known examples of delayed
infrastructure projects from around the world.
Project Example
Budgeted Over budgeted Actual Costs
($USDm)
($USDm)
($USDm)
Taiwan High Speed Rail
Eurotunnel
Berlin Bradenburg Airport
World Trade Centre Transportation Hub
HK-Zhuhai-Macao Bridge
Liantang - Heungyuen Wai Border Crossing
Nagano 1998
840
11,500
3,200
2,000
645
1,058
15,240
14,000
7,000
4,500
4,445
3,148
Completed
Completed
Completed
Ongoing
Ongoing
Ongoing
(Japan Olympics - Sports related costs Japan)
1,012
1,288
2,300
Completed
Wembley Stadium
Guangzhou Ring Road
KLIA 2
Elphiharmonie Concert Hall
1,050
732
530
114
776
507
587
789
1,826
1,239
1,117
903
Completed
Completed
Ongoing
Ongoing
510
150
660
Ongoing
Central - Wai Chai Bypass
We bring the best of our firm’s
capabilities together
PwC’s leading
complex
capital project
execution
Business and
regulatory
environment
Steering
committee
Cost management
HR
management
Capital
Project
Communication
& reporting
Procurement & contracts
Issue
Anti-brlbery and management
fraud prevention
System
security
and access
control
•Deep understanding
of risk and control
combined with indepth knowledge of
capital programs
•Tool kit that enable a
rigourous approach
•Knowing your market
drivers and pressures
•Increasing focus on
the realisation of
project benefits
Operational
compliance
Contacts
Delivering successful projects is one thing, deriving healthy returns from them
is another.
PwC’s leading
edge project
risk assurance
capability
Internal
audit
•Expert team in
leading and managing
successful projects
Project risk
Quality inspection
Scope and
change control
Time
management
(schedule)
Project
Status
14,400
2,500
3,800
2,500
3,800
2,090
Helping you manage
your projects
Successful
execution
of complex
capital project
To learn more about how team can help secure business value from your
investment in project(s), please contact a member of our team.
Mark Rathbone
Greg Unsworth
Zaheer Minhas
Samitendra K Deb
Partner
+65 6236 4190
[email protected]
Associate Director
+65 6236 4379
[email protected]
Partner
+65 6236 3738
[email protected]
Senior Manager
+65 6236 3360
[email protected]
PwC’s independent
assessment at
different project
stages provides you
with the necessary
confidence.
© 2015 PricewaterhouseCoopers. LLP All rights reserved. “PricewaterhouseCoopers” or “PwC” refer to the network of
member firms of PricewaterhouseCoopers International Limited (PwCIL), or, as the context requires, individual member
firms of the PwC network. Each member firm is a separate legal entity and does not act as agen tof PwCIL or any other
member firm.
Providing
Confidence in
Infrastructure
Projects
Thinking about your business and
project
PwC Services in Capital Project Lifecycle Phases
In a recent PwC publication – Capital project and infrastructure spending- it
was stated that Capital projects and infrastructure spending is expected to total
more than US$9 trillion per year by 2025. Although this proposed increase in
infrastructure spending is good for the overall economy, infrastructure projects
do have a history of issues. Delays, cost overruns, lack of risk monitoring, lack
of funding or changes to funding approach, change and variation orders or
procurement failures are very common on infrastructure projects.
The PwC Capital Project Services team has assisted both Government and private sector organisations in most phases of development of an infrastructure project.
Will the project deliver the expected results to
the business within the deadline and budget?
Is the governance structure appropriate to
provide the correct support to decision-making?
How are all the
project and
commercial risks
assessed within
the context of the
overall business
and enterprise
framework?
Management
of project risks
ensures project
benefits and
competitive
advantages are
realised
Projects are
becoming more
global, complex
and risky
Project
management is
becomming
a strategic
competence factor
Are the business and
project controls and
processes suitable,
robust and correctly
implemented?
Is the financial and
tax structuring
appropriate?
Increasing focus
on the realisation
of project benefits
Stakeholders want to know their
project is “on track” to deliver the
intended outcome
A strong control
environment
will regularly
address all risk
elements of an
infrastructure
Actual and
project
Project Appraisal
Business Strategy
& Feasibility Study
Project Development
Option Evaluation
Project Value,
Risk and Financing
Construction and Execution
Procurement
Contracting & Bid Strategy/
Tax Structure
Design
Organisation &
Infrastructure
Build & Delivery
Organisation &
Infrastructure
Operate
Operations
PwC as Development Manager, PMO
Typical
issues in
Capital
Projects
• Poor project definition
• Insufficient planning
• Inaccurate estimation
• Poor risk identification
• Poor contracting strategy
• Weak/ambiguous contract terms
• Lack of incentives to control costs
• Unanticipated site conditions
• Poor risk management and response strategy
• Insufficient project governance, management
and oversight
• Poor project controls (costs & schedule)
• Skilled labour availability
• Inadequate communication and slow decision making
• Inexperienced
management team
• Designing errors and
omissions
• Poor contract
bmonitoring
PwC
Services
• Advise on the economics of the project
• High level financial analysis and
development of business case
proposals approval
• Options and scenario analysis
• Development of integrated risk
management
• Organisation and implementation
procedures
• Financial and commercial
structuring of the project
• Tender/bid preparation
• Review and assessment of
project risk
• Simulation and arranging proper
competition for funding
• Identification of optimum
financial structuring
• Development of performance management
framework and integrated risk management
• Commercial reviews and alignment with
strategy and market
• Operational readiness reviews
• Contract reviews (cost and schedule)
• Analysis of project failures
• Critical path scheduling and programme optimisation
• Claim management process
• Dispute prevention
• Expert opinion report
• Independent Operations
Review – analysis of
contract delivery
• Project troubleshooting/
health check
Project Assurance to keep your project on track
Our Risk Assurance team provides an independent assessment on your project using our unique Project Assurance framework which is tailored to suit your specific
requirement
Deep dive reviews of specific workstreams or risk areas (as needed) – Focus is only on the specific problematic areas
within the purview of a project
Intended outcome
are realised
forecast cost
variances are
monitored
and
escalated
Quality
and
technical
requirements
are met
Capital Project Lifecycle Phases
For any ‘issues’ in these
areas, there needs to be a
monitored plan addressing:
• The impact on scope,
schedule, cost, quality,
safety and revenue
• Achievable actions to get
the project back ‘on track’
• Visibility on the action
status for critical issues
Key schedule
milestones
are met
Deep dives
Key risks are
managed and
mitigated
• What are the root causes of any issues and how can they be addressed?
• Are the individual solution components going to deliver what is required?
• Have recommended actions been carried out?
Regular inflight health-checks to make sure project control is maintained and risks are identified
Performance
metrics are
accurate,
timely, and
reliable
In-flight Health-checks
Project
meets
regulatory
requirements
What is going well with the project overall and should be continued?
What are the key risks to the project’s success?
What should be done to mitigate the key regulatory risks?
Do any of the regulatory risks need more detailed review?
Can you be comfortable that the project is on track from a regulatory perspective?
Heartbeat role embedded in the project (full-scope-approach)
Heartbeat role
Impact of any
changes are
understood and
managed
•
•
•
•
•
• What are the day-to-day challenges?
• What quick fixes are required and how can these be achieved?
• How can health-checks and deep dives be best planned?