Why IT Projects Fail?
When will the IT Industry Grow Up?
The IT industry and the building industry seem to have many similarities, but one area where they are very different is the outcomes.
What percentage of IT and construction projects succeed?
Some stats:
- The Standish Group survey of 400 organisations: 32% Success 44% Challenged 24% Failures
- Computer Weekly survey of UK Public Sector Projects: 30% Success
Some obvious thoughts.
- Are IT projects different from other types of projects e.g. construction?
- Has IT project management attained the same level of maturity as it has in the construction sector?
- Are the practitioners of IT “a bunch of cowboys” while in construction we have skilled civil engineers.
- Are there environmental factors which have a significant detrimental impact on IT projects versus construction projects.
There are a lot of key similarities between IT and building.
- The management of risk
- The design process
- The mechanisms of governance
- A modular approach
- The choice of tools and techniques
- The options for management methodologies from vision to delivery
The main differences seem to be in the maturity, the expectation of customers, governance, and the ability of the IT contractors to communicate and manage real business risks.
Business Ownership
The relationship between business and IT often lacks understanding and the level of communication required to achieve success.
- Loosing the vision: Often the business owners who created the vision and agreed the scope for the project move on. It is critical that the key understanding of the goals, objectives, requirements, implementation approach etc. have multiple senior stakeholder understanding and support.
- Saying stop: A changing market or new insight may significantly change the scope, or need for a different approach. Have the courage to stop the project early. (Stopping the project early should be seen as a success)
Managing Change
During the lifecycle of a project the team will gain more insight into the problem/opportunity. Too much change, and the project costs will sky rocket and it may never deliver; too little change and it may not deliver anything of value. Deciding on the size and scope of work packages and good architecture at all levels is critical to enable the ability to absorb necessary change into the project with managable impact.
Maturity
The construction industry has been around for 100′s of years. Customers have forced governance in the form of national regulation, standards and certifications.
The IT industry is in its infancy. When you engage a vendor if standards and certifications exist they are rarely comprehensive, and almost never read.
Expectations
Construction customers exceptions are set by previous experience and the reputation of a builder is his most important credential.
IT customer’s visions are generally fed by vendors hype rather than reset to reality and although reputation is important price seems to rule.
Governance
Regulation and standards enforced by contracts are created to govern construction incorporating significant financial and reputational penalties. Quality of materials, construction and progress are monitored almost daily and the tolerance for deviation is small.
There is no regulation. Standards in the IT industry are rarely adequate, and hardly ever referenced. When was the last time you asked to check a vendors architecture, design, implementation and coding standards? Governance is often mentioned, however without standards, measures and processes for regular reporting and understood penalties it is, well, useless.
Risk Management
As a result of good governance construction risks and mitigations are well understood and appropriate decisions can be made with a good understanding of the implications.
In IT real business risk is rarely considered, if 25-50% of projects fail/are significantly challenged there is a 2:1 chance that costs will double or all your investment will be lost! When was the last time that was mentioned at your project initiation meeting.
What Can I do?
Perhaps a real focus on understanding the problem, setting realistic exceptions, governance and risk management are all that’s needed.
So you need the right people, preferably experienced, and agreement on an agreed approach.
Appropriately applying an architecture or governance frameworks is a good start.
But most of all think about the factors of project you can really measure and monitor. If your confidence in delivery at any point drops below 80% you probably need to seriously think about what needs to change rather than throwing more good money after bad.