The Fourth (and most important) Variable of Project Management

Project management has long been associated with managing the three project variables: budget, time, and functionality.  These variables have traditionally defined a project success.  A project delivering all desired functionality on time and within budget is considered a success.  However, I consider this the operational perspective of project management.  In this perspective the project is a success when the project is executed as planned.

However, there exists a strategic perspective for project management where these variables do not define success.  A project must create the type of change needed in the organization to realize the desired business value.  Delivering business value is the true strategic measure for the strategic view of project management.  Although budget, functionality, and timeliness are important in the strategic view, these factors do not entirely affect the influence the project has on the organization.

Consider an IT project that is operationally successful.  The new system is delivered as expected, within budget, and on time; it is a successful project.  However, what if the organization does not adopt the new system or what if the new system does not provide the information or improvements needed to realize the benefits (or value) to the organization?  The project is an operational success but a strategic failure.

Business value is the strategic variable of project management.  A recent article in PM Network describes this new dimension.  However, the article takes the approach that it is the project manager that must adopt this new dimension.  I disagree with this approach and in my next post I'll explain why.