How Executive Sponsors Influence Project Success

Companies undertake projects to create and improve their products, systems and services. To improve the chances that projects will be successful, it’s common for organizations to choose senior executives with an interest in the outcome to act as the project’s sponsors. Executive sponsors are responsible for lining up the necessary resources at the beginning, managing (or personally performing) certain activities while the project is underway, and ultimately delivering results.1 Since executive sponsors rarely have enough time to manage projects personally, they must rely heavily on project managers. So which activities and behaviors can busy sponsors perform in the course of a project to increase the chances of a project’s success?

According to recent studies, this is an important question. The Project Management Institute, a professional association for project management professionals based in Newtown Square, Pennsylvania, states that having executive sponsors who are actively engaged is the leading factor in project success.2

In researching what makes for successful project sponsorship, we used a project life-cycle model with four stages: (1) initiating — from the preliminary idea through approved charter; (2) planning — from approved charter through approved project plan; (3) executing — from approved project plan through acceptance of major deliverables; and (4) closing — from acceptance of major deliverables through final completion. Projects come in many shapes and sizes, and many life-cycle models are used to guide behavior and understanding. We chose to use the simplest model.

Most successful organizations are familiar with the initiating stage of a project. Also well accepted is that there are steps that need to be taken to close down the project after the major project deliverables are completed. While the first and last stages of projects are clear, in some settings, the planning takes place before executing starts; other times, there is overlap between planning and executing, or the two are iterative. To ensure that our research was valid for all types of projects, we specifically asked participants in our planning study to focus on planning behaviors and participants in the executing study to focus on executing behaviors.

No matter what stage a project is in, there are established success factors that project sponsors should consider. In the past, project success has been defined by the so-called “iron triangle” of cost, schedule and performance. Thanks to several well-known studies3 that have tended to build on each other, our understanding of project success has become broader yet more specific. Essentially, there are three important success factors. The first involves customer impact: specifically, the extent to which the project creates deliverables that meet the needs of the project’s customers — whether those customers are internal or external to the organization. Meeting customer needs is almost always the most important success measure. The second success factor involves meeting agreements: Was the project completed on time, on budget and to specifications? The third success factor is tied to the future benefits to the company — be they new technology, new products and/or commercial success.

We conducted separate studies of each of the four project stages (initiating, planning, executing and closing), with literature reviews, focus groups, surveys and factor analysis in order to examine executive sponsor behavior and project success factors. (See “About the Research.”) In each project life-cycle stage, we found that two or three behaviors had a significant impact on the project success factors. (See “Key Executive Sponsor Behaviors.”)

The Initiating Stage

During the initiating stage, we identified three important sponsor activities and behaviors: setting performance goals, selecting and mentoring the project manager, and establishing priorities.

Set performance standards.

Part of setting performance standards can be accomplished in the project charter by stating goals about the project’s strategic value and how it will be measured. However, beyond what’s stated in writing, the sponsor and the project manager need to develop a clear understanding of expectations about performance. Effective sponsor–project manager partnerships require a great deal of informal dialogue, especially during the project’s early phases. Later, as project managers gain experience and prove themselves worthy of the sponsor’s trust, the conversations can take place less often and be less detailed.

Select and mentor the project manager.

When a sponsor selects and mentors a project manager, both the organization and its customers benefit. Since the sponsor and the project manager share responsibility for the project, it’s important to select the project manager wisely and make sure that the person is up to the task. Once the project manager has been chosen, the sponsor needs to act as a mentor. Among the sponsor’s key responsibilities are explaining how the project fits into the big picture, defining the performance standards and helping the project manager set priorities.

Establish priorities.

In setting priorities, the most compelling questions are (1) what needs to happen first? and (2) how should conflicts be settled? Sponsors should address these questions both at the organizational and project level. The sponsor needs to ensure that benefits to the business are clearly explained and fully understood by the project manager and the executive team. The sponsor also needs to make sure that the project manager knows which aspects of the project are most urgent and which aspects can be postponed.

The Planning Stage

For the planning stage, we identified two critical sponsor behaviors and activities. The first is to ensure that all the necessary planning is accomplished on a timely basis; the second is to develop productive relationships with stakeholders.

Ensure planning.

Executive sponsors need to ensure all the necessary planning activities are completed, although most of these will be performed by a project manager and team. Sponsors need to provide leadership so that the project manager and team can set project goals that align with the vision and the broader organizational goals. Before committing to a particular approach, it’s important to consider different options. Sponsors also usually need to ensure that project managers develop a schedule, a budget, a resource plan, a risk management plan, a communication plan, a change control process, an escalation process and a periodic review structure.

Develop relationships with stakeholders.

We found that when an executive sponsor personally works to establish good relationships with the project’s key stakeholders, the organization often benefits. Sponsors should ensure that all stakeholders are identified and should meet frequently with peers in client organizations to seek understanding. In addition to seeing that project stakeholder wants and needs are identified and understood, executive sponsors should make sure that stakeholders’ emotional concerns are given adequate consideration. Successful executive sponsors create an environment that is conducive to effective communication between project teams and stakeholders. In some circumstances, it may be necessary for sponsors to become personally involved in that communication. It’s up to sponsors to maintain effective communication and to ensure that the project’s customers are involved in its planning and understand the project’s value.

The Executing Stage

During the executing stage, we found that there were three important sponsor behaviors and activities. They are: ensuring adequate and effective communication, maintaining relationships with stakeholders and ensuring quality.

Ensure adequate and effective communication.

As the project progresses, communication needs to take place regularly between the project team, the project manager and the stakeholders to make sure that the expectations are being met. The executive sponsor can facilitate this communication by visibly empowering the project manager. However, sponsors must also stand ready to manage the organizational politics with internal and external stakeholders. Effective sponsors can remove obstacles, resolve conflicts and encourage input. In addition, they can personally communicate their concerns to appropriate executives.

Maintain relationships with stakeholders.

Executive sponsors can work with project managers behind the scenes to make sure that the project manager and project team communicate effectively. Yet there may be situations when a team member wants to interact directly with the sponsor. Effective sponsors need to be open to direct feedback from team members, both as individuals and groups. Sponsors ensure continued customer involvement and ensure that the expectations of key stakeholders are met. They should also plan to communicate directly with key stakeholders to explain significant aspects of the project and why they are relevant.

Ensure quality.

We identified several sponsor activities and behaviors that help ensure quality. To begin with, executive sponsors can act as role models to ensure that ethical standards are upheld. They can also practice appropriate decision-making methods and work to resolve issues fairly. Finally, they can insist on using proven processes for managing change, monitoring risk, escalating issues and applying timely corrective actions. Sponsors should also work to ensure that the project’s customers are satisfied with the project deliverables.

The Closing Stage

In the closing stage, we found two activities sponsors should stress. The first involves knowledge management. The second involves verifying that the organizational capabilities have been improved and promised project benefits achieved.

Identify and capture lessons learned.

During the closing stage, sponsors need to make sure that meaningful lessons learned from the project are identified and captured. Such lessons need to be categorized, stored and distributed in such a manner that future project teams will be able to understand and capitalize on them. Sponsors should insist that any new projects begin with a review of the knowledge repository to determine which lessons from prior experiences to apply.

Ensure that capabilities and benefits are realized.

Part of wrapping up a project is asking how the organization might increase its capabilities based upon what employees learned from the project. These capabilities could include employees becoming more committed and more capable, and processes that are more effective and more efficient. Assessing capability increases can begin as soon as the project ends. A second aspect of a project closing is verifying that the deliverables that were specified at the beginning were actually provided, work correctly and satisfy customers’ needs. It usually makes sense to wait a few months to see how the project deliverables are actually working. Although there’s a temptation to close the book and move ahead, sponsors need to push for this follow-up. Otherwise, it is unlikely to happen, and the company will miss an important opportunity to receive valuable input from the project customers regarding how they use the deliverables, how well their needs have been met and ultimately how satisfied they are. This input can help companies serve their stakeholders better on future projects. After all, the needs of the project’s customers are the primary reason for undertaking a project and the most important measure of success.