Spinning Wheels

Posted March 3, 2011

We analyzed our internal database and found that that of all supplier searches conducted on behalf of our clients, only 6% progressed into fully activated projects. When it comes to marketing projects, "the best laid plans...may often go awry."  Whether by design or unexpected circumstances, a large number of incipient projects never see the light of day.

Commonplace

Although no marketer enters the planning process thinking the project won't be executed, what we found is that terminated projects are fairly commonplace.  More than half of the survey respondents said that during a typical year at least 3 planned projects are canceled.  Almost 30% said 7 or more projects are canceled in a year.  Separately, our clients tell us that they know certain projects are never destined to be executed as they are just exploratory "what ifs". 

Necessary Evil

In a time of limited resources, uncertain funding and shifting strategies, terminated projects may just be a necessary evil that has to be tolerated, but at what cost?  Budget limitation was the most commonly cited reason (58%) for discontinuing a project.  Another 12% said shifting strategies or priorities was the reason for the lack of activation.  The problem with any cancellation is that no one knows which projects will be executed or canceled going in and thus the same resources are dedicated to all projects.

Staff Time

Whatever the reason, the cost measured in dollars and staff time is considerable.  Over 42% estimated they wasted over $25,000 a year on terminated projects, and 20% said the figure was in excess of $100,000 a year.   A quarter of respondents said they spend more than 25% of their time (or their department's time) researching ideas and prospective suppliers.  So while dollars and resources are identified as limited, all respondents indicated that they wasted both during the typical planning process.