why projects fail

Running Head: WHY PROJECTS FAIL 1

Why Projects Fail

Teresa J. Rothaar

Wilmington University

WHY PROJECTS FAIL

Why Projects Fail

Projects fail for numerous reasons. The Why Projects Fail website lists 101 common

causes, while Bruce Harpham’s blog post on Better Projects argues that most project failures can

be traced to one or more of only three core reasons:

1. Poor estimates during the planning phase.

2. The scope changing mid-project.

3. Insufficient resources, monetary and otherwise (such as staff).

While, I agree with the Why Projects Fail site’s assertion that the majority of project

failures occur for a variety of highly complex reasons, I also agree with Harpham that the root

cause—the one that caused all of the other issues—is likely very simple. In my experience, both

in business and on a personal level, many if not most project failures can be attributed to a

simple lack of communication between all stakeholders from the beginning. This ends up

causing a host of other problems down the road, including Harpham’s three core problems, as

well as a fourth core problem: not everyone is fully on board with the project, because they do

not understand how the project will benefit them or—even worse—feel that the project will be

harmful to them. People in the former category may be unwilling to provide the necessary

support for the project, while people in the latter may attempt to sabotage it.

As I discussed in a message board post earlier this week, Avon endured one of the most

spectacular project failures in recent times with its “Promise Project.” Avon had fallen behind

the times when it came to ecommerce. The company’s door-to-door “Avon calling” model,

complete with customers filling out paper order forms, was no longer relevant to 21st century

consumers, and the company was having difficulty competing with cosmetic companies that had

long since switched to online sales. The Promise Project was a good idea in theory. It was

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WHY PROJECTS FAIL

supposed to equip every field sales representative with an iPad, upon which customers could

place orders and enjoy features such as real-time inventory checking (Henschen, 2013a).

Unfortunately, Avon made a crucial mistake: it never asked its sales representatives what

they wanted, and apparently never involved them in the project in any fashion. It simply told

them that a great new system was coming, then went ahead with designing and implementing an

order system that end users rejected, claiming it was buggy and too difficult to use. The

representatives hated the system so much that approximately 16,000 of them quit across Canada,

where the project was piloted (Henschen, 2013b). After Promise was terminated in December

2013, Avon disclosed in an SEC filing that they had lost $100 million to $125 million on the

failure (Why Projects Fail, 2014).

Avon’s representatives were clearly never on board with this project. They did not see

how it would benefit them, and in fact, they saw the new system as an impediment so severe that

they left the company over it. Communication between Avon and its representatives could have

prevented these issues. The company could have designed a system that everyone would have

embraced, if only they had involved the end users in the project process.

What Avon did was bad. What retailer J.C. Penney (JCP) did might have been worse;

their failed project to revamp their pricing strategy resulted in the ousting of CEO Ron Johnson

after only 17 months in the role. Avon failed to communicate with its sales representatives.

Johnson refused to communicate with JCP’s customers (or with JCP employees who begged him

to do so). Upon taking control of the company, Johnson decided that he would eliminate sales

and coupons, under the assumption that customers would prefer “everyday low prices.” Problem

was, Johnson had no statistics or research to back up his theory, and he steadfastly refused to

perform any market research to determine whether JCP’s customers would respond favorably to

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the change. He also refused to pilot-test his pricing strategy, insisting that it be immediately

implemented in every store from coast to coast. Customers hated that their coupons and sales

were gone. The retailer’s sales continued to plummet, and, as Johnson insisted on staying the

course, claiming that things such the color of the price tags were the problem, employee morale

went down the toilet. After firing Johnson, JCP released an ad apologizing to its customers for

not listening to them, and told the press that the ex-CEO was “out of touch with the company’s

customers, its workforce and its culture” (Bhasin, 2013).

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References

Bhasin, K. (2013, May 2). J.C. Penney Pricing Disaster Destroyed Employee Morale. The

Huffington Post. Retrieved from http://www.huffingtonpost.com/2013/05/02/jcpenney-

pricing-disaster-morale_n_3196037.html

Harpham, B. (2014, September 17). How to Prevent Project Failure in 2014. Better Projects.

Retrieved from http://www.betterprojects.net/2014/09/how-to-prevent-project-failure-in-

2014.html

Henschen, D. (2013a, December 12). Avon Pulls Plug On $125 Million SAP Project.

InformationWeek. Retrieved from http://www.informationweek.com/software/enterprise-

applications/avon-pulls-plug-on-$125-million-sap-project/d/d-id/1113061

Henschen, D. (2013b, December 16). Inside Avon's Failed Order-Management Project.

InformationWeek. Retrieved from

http://www.informationweek.com/software/information-management/inside-avons-

failed-order-management-project/d/d-id/1113100

Why Projects Fail. (n.d.). 101 Common Causes. Retrieved from http://calleam.com/WTPF/?

page_id=2338

Why Projects Fail. (2014, January 21). Avon Products. Retrieved from

http://calleam.com/WTPF/?p=6248

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