Thought Leaders

The Seven Deadly Sins Of Project Management: Optimism Bias

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Project management is a key vehicle for organisations to turn strategy into action. However, despite the increasing investment in project management capability, many projects still fail to meet their objectives.

In this first article in a series we explore how optimism bias can kill a project from the very start, one of the ‘seven deadly sins’, initially coined by Jeffrey Pinto in his paper ‘Lies, damned lies, and project plans’: Recurring human errors that can ruin the project planning process’.

At Skarbek, we often parachute into situations where a client’s key projects are in crisis and the blame game has begun. Has there been malpractice in project management, or is it environmental factors that have driven failure – lack of resources, commitment, engagement, or sponsorship?

To those project managers who readily point out that their projects were well run, but these external factors conspired against success, Pinto’s seven deadly sins provide some insights that can make the profession question whether they really got it right from the beginning.

Research on optimism bias suggests we may be wired for disappointment and given that animals also appear to exhibit the same behaviour, it may well give an evolutionary advantage.

We tend to systematically expect more positive outcomes than those that actually occur.

That we maintain this expectation in the face of disconfirming information is also interesting; it suggests there is an ongoing process of filtering out the more negative information that means that disappointment can be staved off until a much later, but inevitable reckoning.

There is also a growing body of evidence that this bias can be adaptative; it has been selected through evolution because it benefits our physical and mental health. Disappointment delayed helps us function.

However, does the evolutionary benefit equal business benefit? As with many psychological processes that may have helped our survival, relying on these responses may not serve us as well when it comes to navigating the complexity of the modern business world.

Pinto’s research suggests three issues that optimism bias can cause in project planning:

  1. Project team members will underestimate their own task completion times, but not others’
  2. Project teams will tend to focus on the time modelling activity in the current project plan at the expense of using previous experience, even when those experiences may have been very similar
  3. Past poor experiences are usually written off to external causes and the learnings discarded as not relevant to the current project

A damaging effect of these issues we have often seen is becoming trapped in the incremental adjustments of an initial timing anchor. In our clients it is rare that a project arrives to be initiated and planned without a launch timing already associate with it.

That stake in the ground is then very hard to leave behind and even when the project is planned in detail, reference is always made back to that original launch date.

This can badly affect the validity of even plans worked up in great detail, as every task estimate is made with the incorrect anchor in mind and the plan is thus skewed away from more objective estimates.

As an extreme example, we had one client who would always measure any project back to the first launch estimate, no matter how long ago that was made or how much the scope had changed.

This ensured that on being unlucky enough to be assigned to even a 5-year old project, the bias caused by the initial anchor persisted in de-railing the current project team’s timeline accuracy and well as being a constant drag on morale!

How then to rid your projects of these optimism biases? Here are some suggestions from our experience, all of which can be incorporated into our signature ‘integrated planning’ approach:

  • Allow the group to challenge each individual’s time estimates. It may take skilled facilitation to make everyone comfortable, but this cuts out a significant portion of the error.
  • Build a database of timings between stage gates, key milestones, or for key processes that repeat during your projects. This makes it harder for all to ignore the disconfirming information.
  • Always conduct AARs (After Action Reviews) after both successful and unsuccessful options. Then pull 3 similar project reviews (pick the best, worst and most average similar AAR reports) to discuss with the team before planning, to pre-condition their thinking realistically.

In future articles, we will example the remaining deadly project sins before drawing together our insights as a whole of what may be dooming your projects from the offset and the overall strategies that we have found can be employed to avoid this fate.

John Hall is operations director at Skarbek Associates.

John Hall
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