1. Fix it or Forget it? Dealing with Troubled Projects
Scott Hine
Director, Information Technology Services Office
U.S. Department of Energy (DOE)
Office of Energy Efficiency and Renewable Energy (EERE)
2018 Project Management Symposium

2. By a show of hands…
Fewer than a third of all projects were successfully completed on time and on budget over the past year. (Standish Group)
How many of you have had experience with troubled projects or project failure?
How many of you have fixed a failing project that was close to being cancelled?
How many of you have had to terminate a project?
Success in 68% of IT projects is “improbable.” (IAG Consulting)
Projects are 2.5 times more successful when proven project management practices are used. (PMI)

3. Overview of troubled projects
33% of projects fail because of a lack of involvement from senior management. (University of Ottawa)
Project “failures” influenced by project factors, external market conditions, and regulations
Troubled projects often go unnoticed until it is too late
Project teams reluctant to identify underperforming projects
Ensure effective communication of the consequences of “failure” and response to risk
Response is often to “fix it,” but “forgetting it” is sometimes the more appropriate choice
High-performing organizations complete 89% of their projects, while low performers complete 36%. (PMI)

4. Portfolio overview
~2,800 projects (R&D Portfolio) related to renewable energy and energy efficiency technology and innovation
$1.2B in laboratory projects for 17 national labs
$4B in financial assistance projects for 12 technology areas
Regular monitoring and reporting requirements
3 to 3.5 year project length with annual budget periods
Average project size $3M to $4M
1 - 10
>50
Projects by State
National Laboratory

5. Portfolio challenges Unique mission
Large, technically and geographically diverse funding recipients
Internal and external risks influence project performance
High profile projects
Unique mission
Project goals are advancing technology, not maximizing profit
Stewards of taxpayer money to obtain the greatest impact
Prioritize proactive communication of risks and working with performers to resolve issues
Financial assistance projects cannot be terminated for convenience
Technology Areas

6. How to address troubled Projects?
“No surprises” culture
Proactive communication of risk (“See something, say something”)
Use multiple data streams to establish an early warning system
Incorporate enterprise risk management activities into everyday business operations
Continuously train project managers on warning signs

7. Establish a project evaluation process
Get buy-in from stakeholders and senior leadership Identify evaluation criteria Develop tools to analyze project performance Monitoring Activities Conduct analysis and reporting
These steps can be adapted to all organizations, regardless of your priorities or constraints.

8. Get buy-in from stakeholders and senior leadership
Communicate goals to senior leadership
Proactively communicate risk
Establish communication pathways
Remind them that risk is expected
Set expectations
Review what project “failure” might look like
Prepare for potential consequences
Identify how the organization will respond and move forward
Get input from staff that will be asked to carry out proposed policies

9. Identify evaluation criteria of troubled projects
Identify risks and develop thresholds for deviation from acceptable limits
Use historical performance to identify warning signs
Revise as necessary

10. Evaluation criteria of troubled projects (examples)
Layoffs or high turnover
Major audit findings
Changes in market conditions
Leadership changes
Failure to comply with corrective actions
Chronic failure to meet performance, schedule, or cost goals
Policy changes that may have market, financial or technical impacts
Significant weather events

11. Develop tools to analyze project performance
Informed by evaluation criteria and data availability
Can be as simple or complex as you want, as long as it meets your needs
Ensure that your outputs are useful and deliberative
Validate criteria, data and tools once there is an “event”

12. Financial health analysis for select performers
Submit report on findings and provide recommendations to project management staff
Input data into algorithm
Schedule performance
Cost performance
Project size
Number of projects with a specific vendor
Invoicing history
Reported project health
Third party financial metrics
Monitor significant events
Cash flow and liquidity issues
Changes in market conditions
Supply chain concerns
Leadership change or layoffs
Changes in partnerships

13. Monitoring activities
Project management staff provide ongoing monitoring
Review of quarterly progress and financial reports
Site visits take a closer look at progress, capabilities, and processes
Independent reviews evaluate how projects are being executed and if they are meeting milestones
Regular communication with performers to help address issues as they arise
Significant events are reported immediately

14. Independent Project Reviews (see handout)
An objective evaluation of project performance.
Used to enhance oversight of challenging projects, adding a third party perspective when specific concerns are identified.
Used to determine whether projects at risk of termination should proceed, and if so, whether additional resources are needed to ensure effective oversight

15. Conduct analysis and reporting
Analyze available data using the tools that you have developed
Establish a system and schedule for reporting results to decision makers and senior leadership
Ensure decision makers have the results in hand when they need to make decisions, or have access to the information as often as possible

16. Summary
Identifying and monitoring troubled projects is the right thing to do
It will take time to gain traction with new policies
Work with the project teams to show value – it isn’t just for senior leadership
Continuously remind project teams that all projects will not be on track all of the time
Communicate to project teams that it is always better to report an issue than to not report it

17. Questions, Answers, Discussion

18. Contact information
Scott Hine, Director
Information Technology Services Office,
U.S. Department of Energy
Office of Energy Efficiency and Renewable Energy
Executive Sponsor of FedPM COP
Get involved at