Execution is Overrated - Project Selection is Where the Real Magic Happens

With the new financial year around the corner, it's that time of the year when organizations gear up to finalize which projects to greenlight. Each project aims to solve a problem - whether it's driving innovation, improving efficiency, or expanding market presence.

The stakes? High. The budget? Limited. The pressure? Through the roof.

Based on my past learnings, project selection often follows a familiar pattern:

1. First, there are projects aligned with core business priorities - let's say addressing business challenges in key functions like supply chain optimization, geographical expansion in upcountry locations, or maybe SKU optimizations, etc.
2. Then come projects aimed at enhancing internal practices and tools - perhaps an HR system revamp, an upgraded CRM for better customer insights, or maybe simplification through automation/process excellence.
3. And finally, there are projects aimed at keeping pace with market trends and technology shifts - such as exploring AI-driven automation, investing in sustainability initiatives, or developing chatbots/virtual assistants to increase efficiency, etc.

Well, each project has its own benefit, sounding compelling on paper. All the projects put together make a compelling portfolio of projects. But sometimes, the real question isn’t which projects are good—it’s which ones will truly move the needle.

Why Does Project Selection Matter More Than Execution?

Every major transformation—whether it's entering a new market, launching a breakthrough product, or modernizing operations - begins as a project. Basically, projects are an important vehicle for growth and transformation.

In fact, in countries like Germany, Iceland, and Norway, nearly 30% of economic activity comes from project-based work. The numbers tell a clear story: projects drive progress.

But here’s the kicker: the biggest factor in project success isn’t execution - it’s selection.

You can have the best team, the perfect plan, and flawless execution, but if you're working on the wrong project, it won’t serve the objective or move the business forward.

So the real challenge isn’t just delivering projects well. It’s choosing the right ones to begin with.

In theory, and according to PMI Institute statistics, organizations with strong project execution waste 28x less money than poor performers - highlighting why selecting the right projects is crucial. From my experiences and multiple catch-up calls, I've seen that project selection is often assessed based on two key factors: avoiding costly failures and maximizing opportunities within tight budgets. Essentially, a key consideration is - how would an alternative project have performed if it had been chosen instead of the current one?

How Does Project Selection Happen?

Often, project selection is led by a project committee - a group of sponsors with a pool of problem solvers. The key factors determining selection are often the selection committee and the budget that will be invested in the project.

Yes, budget matters. It's a key factor in choosing a decision rule. The tighter the budget, the more critical it is to select the best projects from a long list. Typically, selection plays out through:

1. Often, the senior-most leader/leaders making the final call - whether investing in new products, ventures, or research, or deciding whether to continue with a project or drop it.
2. Selection through an internal committee - arguably an approach followed mostly across various organizations:

• Committee Votes – A democratic approach where the committee receives a proposal on the list of projects and shares their preference. However, there is a likelihood that it is prone to biases.
• Committee Scores – Works well when projects are comparable (e.g., a tech firm evaluating different versions of the same product, diff. vendors for HRMS etc. ). However, if projects vary widely in nature, scoring loses accuracy.
• Committee Ranks – For situations when the project options are diverse and the budget is tight, ranking outperforms other methods. The committee usually ranks projects based on financial impact, strategic value, execution timeline, etc.

1. Crowdsourced Decision-Making – A method less talked about but practiced in some contexts and for specific purposes to achieve the highest level of accuracy. Each unit/ function/ region submits projects based on their needs as per the allocated budget; selection happens based on employee voting on the submitted projects. It’s a complex method, yet it makes the end user a part of the decision-making (e.g., IBM's iFundIT).

So what's the ideal approach? Which project should be selected and which one parked for a later stage? While factors such as business priorities, sponsorship vision, and the organization’s growth stage play a role in decision-making, the answer largely depends on budget constraints, expertise, and the volume of project proposals. To simplify and summarize:

1. If there are only a few project submissions, score them based on certain parameters. Scoring will serve the purpose, and the top-scoring projects can be taken up as execution priorities. Budget constraints are less relevant here given the few submissions.
2. If project proposals are abundant, there's a high chance that budget constraints become significant. In such situations, let the project committee rank them. And if the project nature demands expertise, let there be expertise-based scoring by the committee.
3. And eventually, if nothing else works, let a single executive make the decision.

The reality is that even the best project selection method won’t guarantee success. But choosing the right process can mean the difference between funding a game-changing project or missing out on it altogether. Even companies with smart people and great analytics consider themselves lucky if just 10% of their projects succeed. But refining project evaluation and selection can lead to one more winning project—a competitive advantage driving real business impact.