Failed IT projects lead to big business failures...

I read an interesting article from Computer Weekly the other day, claiming that "failed IT projects demolish big businesses and executive careers". According to researchers from Oxford University, senior executives are losing jobs and businesses are collapsing due to unfinished, or failed, projects. With IT projects estimated as 20% more likely to run out of control than other projects, with 1 in 6 increasing their average budget/ cost by 200%, this is a real worry for businesses. More complex projects can become unpredictable, with this often not understood by the project managers, and both public and private sectors are suffering from these oversights. With managers focusing on average performance rather than variability, many IT projects seem doomed to fail.

Massive companies - such as Airbus, Levi-Strauss, Tollcollect and Hershey's - have all been on the brink of collapse because of out of control IT. In 2009, BT Global Services lost £1.2bn due to cost overruns on big contracts with the NHS and Reuters. In the same year, the £234m "C-Nomis" IT system for prisons failed. It was continuously assessed as proceeding to time and budget, but in fact wasn't. The National Audit Office concluded that the technical complexity had been "significantly underestimated." The system had gone the same way as many other failed government IT-based change programmes, making the same mistakes along the way. IBM were sued only last year for a failed virtual PC server project, and in 2009 HMRC sucessfully claimed over £71m in damages from ERS for the muck-up they made of the Tax Credits system, which led to thousands of families being overpaid.

So what IS it causing these large-scale failures? Is it leadership, project management, over/under estimating... or incompetence? Duncan Haughy of Projectsmart.co.uk says that "the biggest problems that projects face are inadequate definition, scope and planning." Is this true of IT? Seems like it. So how do we avoid these pitfalls? Reinder Otter of Capgemini has these rules to follow for a successful outcome.

1) Freeze scope - enforce release management rules.
2) Keep requirements SMART.
3) Involve stakeholders and users at the start.
4) Keep things simple with the right funcionality.
5) Avoid bad management - someone must have an overview at all times and manage any gaps or overlaps between suppliers, stakeholders and customers.
6) Balance quality and cost.

And another one I would add - learn from past mistakes.

I suppose that, at the end of the day, not all projects are created equal, but they can all equally fall by the wayside.

I'm just glad that my biggest IT project involves turning on my laptop and checking my emails...


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