A global survey of project managers has found a drop in the proportion of budget spend that gets wasted.
A report by the Project Management Institute (PMI) found organisations reduced the average amount of money they wasted on projects by 20% in 2016 compared to 2015.
Organisations wasted an average of $97m for every $1bn invested in projects and programmes in 2016 – down from $122m per $1bn the previous year.
The survey, involving 3,234 professionals, also found that project management was becoming increasingly mature and better at developing technical, leadership and business skills.
A third of respondents considered technical and leadership skills a high priority, 3% up on 2015.
Some 31% of organisations reported high “benefits realisation maturity”, which meant benefits were sustained once the project ended.
Organisations that established enterprise project management offices (EPMOs) generally reported better project management performance.
Respondents who said they had a strategic EPMO reported 38% more projects met original goals and 33% fewer projects were deemed failures.
PMI president and CEO Mark Langley said: “Organisations that invest in proven project management practices waste 28 times less money because more of their strategic initiatives are completed successfully.”
Of the industries surveyed, healthcare reported the highest average waste on project spending at $112m per $1bn, followed by telecoms – $106m per $1bn, energy – $101m per $1bn and manufacturing – $98m per $1bn.
Regionally, India reported the lowest average monetary waste on projects at $73m per $1bn, followed by both China and the Middle East ($82m per $1bn). Europe reported the highest waste at $131m per $1bn.
Waste per $1bn of spend by sector:
Healthcare – $112m
Telecom – $106m
Energy – $101m
Manufacturing – $98m
Government – $97m
Financial services - $97m
Construction – $94m
IT – $78m
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