Early warning indicators


The crisis situations in projects are always similar. Most actors in crisis projects already have a gut feeling in the early phases to recognize such projects. But there are reasons why these findings remain hidden, problems are not dealt with and no appropriate countermeasures are taken.

A 2006 survey by Leon A. Kappelman, Robert McKeeman and Lixuan Zhang in ism-jounal shows the most dominant early warning indicators.

LPM® Identifizierung von Trends zur Vermeidung von Gefahren
LPM® Identification of hazard prevention trends

Details on the methodology of the survey

The research team first searched the literature to establish a preliminary list of early warning indicators. The two authors first tested these in IT projects and then added further early warning indicators based on their personal experience. Next, 19 IT project management experts were asked to evaluate the list. Based on their feedback, they added further early warning indicators and modified the existing list of 53 early warning indicators. Finally, 138 experienced IT project managers (including the original 19 experts) were invited to evaluate the 53 early warning indicators using a scale from 1 (very unimportant) to 7 (very important). Finally, 55 managers participated in the survey, representing a response rate of almost 40 percent. On average, the respondents had more than 15 years of experience in managing IT projects. The budgets of the largest IT projects were between 2,688,899 and 6,274,099,263 euros. About 30 percent of these were active as program or project managers and almost 20 percent as consultants. The other 15 percent were directors or program analysts, 10 percent were vice presidents, and the remainder were CEOs, CIOs, development managers, technology managers or partners.

The following table shows the summary of the results, divided into two categories, as personnel and process-related indicators.

Dominant early warning indicators

Personnel-related indicators Process-related Indicators
Lack of support from top management Missing documented requirements and / or success acceptance criteria
Weak project managers Missing change process (change management)
Lack of involvement of stakeholders and/or contributors Poor schedule planning and / or schedule management
Lack of commitment of the project team Insufficient communication without differentiation for the interest and participation groups
Project team members had significant knowledge and/or knowledge gaps Deduction of resources due to projects with higher priority
Overworked technical experts No business case for the project

What makes this survey unique? It shows once again that most of the reasons that lead to crisis projects are always the same. But no one in management really wants to find the causes at an early stage. And now to the actual reasons: Since such projects are usually important, they are transferred to supposedly strong project managers, who then naturally enjoy the trust of the management. So no project team member (especially if it comes from other departments) will really take the initiative to demand necessary changes early on and from now on the crisis starts its own life. You would hardly have a chance with your objections, because at the beginning of a project the management trusts in the project manager. From a management point of view, you don’t want to intervene here because you want to give the project manager time to do the whole thing straight. But an intervention would already be necessary at this point and this is also necessary. Not necessarily to dismiss the project manager, but to set up the necessary measures together with him and the project team to get back on the right project path.

Now the question arises, how can we change these or similar situations?

Solutions to prevent crisis projects are simple, but not so easy to implement. The only way a management can intervene is to make forecasts based on figures, data and facts. Remember in our example, I am sure that the “strong” project manager has delivered all the figures, data and facts from his project on time. But the only question is that he also provided meaningful forecast figures. The forecast data, which enables a retrospective trend analysis based on company key figures. Certainly not!

And now the actual work begins for you in your company. How many project-specific key figures do you regularly record in the ERP system per project uniformly and worldwide? Many, I am sure. But are these also the correct and necessary key figures? You’ll say yes, because that’s how you’ve been successfully managing your projects for years, except for the outliers. You’re right, you’re already recording most of the necessary key figures/indicators today. Only the reports compiled from this data, if you are honest, use a retrospective view of the project to a large extent. But IMPORTANT are those indicators that allow you to predict trends for the future.

And now some good news. Studies in the project business have shown that you only need between 35 and 65 indicators for this.

So let’s make an appointment today …