Poor project management is a deciding factor in the failure of many companies. Some projects fail because they are spectacularly stupid ideas. A finishing school for future game show hostesses is an idea that deserves to fail. On the other hand, many projects based on viable ideas also fail. One of the most spectacular information technology project failures in recent history is the Federal Bureau of Investigation’s Virtual Case File project. It’s not every project manager that gets to waste between $100 to 200 million dollars of the taxpayers’ money.

Why do projects, particularly IT projects fail? Some of the reasons include:

Failure to define – if you haven’t clearly understood what you are trying to achieve with the project you have failed before you are out of the gate.
Scope creep – changing the goals of the project after the project is underway. Some flexibility is good. Too much spells disaster.
Micromanagement – project managers who don’t know how to delegate doom projects all the time. A key element of success in project management is divvying up the work appropriately. This is one of the primary responsibilities of the project manager.
Poorly defined roles – do you know who the project stakeholder is? Does everyone on your project team understand their own role and the role of everyone they work with?
Flooding the project with resources – without a clearly defined project management plan this is the equivalent of firing a weapon on fully automatic without aiming. You might hit your target but you might hit a lot of other things too. The U.S. military removed the fully automatic switch from its basic infantry rifle for a reason.
Overstaffing – project managers need a clear understanding of the human resources they’ll require prior to the project’s kickoff. Throwing in additional human resources as a project is failing usually compounds the problem rather than alleviating it. Run lean and efficient.

CIO.com recommends the following eight best practices to avoid project failures:

• Define – make sure roles and responsibilities, project standards and project goals are all crystal clear.
• Evaluate – organizations need a vetting process so that only the best ideas actually morph into projects.
• Resources – make sure you have the right people and the right budget.
• Goals and objectives – every member of the project needs a basic understanding of what you are trying to achieve.
• Control – the project manager must maintain firm control of scope and budget.
• Monitor – are the milestones being met?
• Measure -what are the metrics for success?
• Improve – learn what you could have done better and apply it to the next project.

Source: Project Management: 8 Steps to On-Time, On-Budget Delivery