Six Reasons Why Professional Services Projects Fail

Perfect execution is the goal of every project manager. No one wants to see a project come in late or over budget. Consider these common mistakes and ways to better serve your clients.

Professional services project management is a fast-moving field, with the average project manager running up to five projects at once. Planning, scheduling, overseeing work, and communicating with the client is a balancing act, and almost every project manager has a story or two of a project that got off track.

Regardless of how you define project failure – off schedule, off budget, scope creep, or some combination of these – there are common threads that can be identified to better understand where exactly things went wrong.

Here are the top six reasons why professional services projects fail, and what you can do to prevent them from happening in your firm.

1. Lack of Clarity

Communication is the most important skill for a project manager to master. When there is a lack of understanding around contract requirements/scope, projects go off the rails in a hurry. Working directly with the client to understand the contract and help shape the requirements at the outset of the project makes all the difference. It’s a small investment of time with lasting returns.

Further, a deep understanding of client needs makes the project manager better equipped to communicate effectively internally, ensuring all team members also understand the contract and what is required to deliver optimal results.

Pro tip: Keep your clients on speed dial. Don’t wait for a regularly scheduled meeting to touch base. If any questions come up about the contract, reach out right away to establish clarity.

2. Scope Creep

Scope all of the work to perform a project, from outlining deliverables to determining deadlines. Understanding the scope from proposal to execution is critical. A project manager’s comprehension of scope at the proposal stage ensures the price and schedule are reasonable and realistic. But what happens when there’s a misunderstanding?

Scope creep happens: doing work that is not in the contract. It can be tempting to keep the client happy by going the extra mile, but when the work is not within scope, you’re not getting paid for it. And the result is typically extended timelines, frustrated team members, diminished quality of the finished product — and sometimes red ink at the bottom line.

Pro tip: Talk with your contracts team before completing any work that feels like it may be out of scope. With their insight, you’ll be equipped to communicate well and provide your client with options.

3. Lack of Qualified Resources

Hiring new employees, retaining good talent, and managing resources is proving to be a top challenge in today’s market. Professional services project managers need to inform their human resources teams of what skills are needed for project execution, and when those skills will be critical. Remember that extra lead time is necessary for hiring when specialized skills are required to execute a project.

Pro tip: Involve your HR team early and often. They need time to recruit and hire so you can be equipped for success.

4. Inexperienced Project Managers

Without a doubt, the most important role on a project is the project manager. They are responsible for the execution of the project and all communication that needs to happen to keep things moving. Managing budget, scope, and schedule is a juggling act, and the number of balls in the air depends on the size and nature of the project.

Project management is a discipline that requires innate basic leadership skills, but there are many aspects of managing a project that will be learned through training and experience. Both hard and soft skills must be honed to effectively lead a team.

Pro tip: Make sure your organization provides the necessary support, training and career path for this critical, jack-of-all-trades position.

5. Missing Information & Analytics

Even in 2023, many projects are still managed with spreadsheets. Despite knowing that spreadsheets are error prone and difficult to share and version, some professional services firms have delayed their search for a better format to execute and track data.

Using charts and graphs in tandem with detailed reporting can give quick and powerful insights into trends and variances to help inform and course correct if necessary.

Pro tip: We’ve all heard the phrase, “Don’t be data rich but knowledge poor.” Make sure your organization has reporting and analytics tools that will provide role-based information to the projects and executive teams.  

6. Poorly defined policies and procedures

Solid policies and procedures for project management are critical for keeping both experienced and new project managers on track and equipping them for success. Many organizations have no such policies and procedures. Others have them, but they are collecting dust on a shelf because they are out of date or irrelevant.

Make sure your processes are current and realistic for your organization. Projects are not one-size-fits-all, so be sure they are tailorable to accommodate project size and type.

Pro tip: When clearly defined policies and procedures are in place, invest time into role-based training so all team members understand how their work is affected.

Get More Data and Tips in the GAUGE Report for GovCons

From sale to service, project managers in the professional services industry are busy people. If one or more of your projects has failed recently, it may be time to take a close look at utilization. Unanet’s GAUGE Report highlights recent data around project management maturity, resource management, and other factors that impact efficiency. Download your copy today to see how you’re doing compared to industry peers.