IT project failures - The Next Big Thing -
IT project failures

I was exchanging emails with Dennis Howlett about his thoughts on improving EDS' blog. He posted an entry about this blog and so an e-mail discussion ensued. In the process of that discussion, he wondered what I thought about this article from Accounting Age magazine discussing an analysis by KPMG of IT project failures. From what I read, it said that projects fail because of bad metrics and poor governance. I can see their point since exposing something to sunlight illuminates as well as disinfects.

The document does make the statement:

'Success is increasingly being defined as achieving the promised benefits, as opposed to the traditional focus on time and budget measures.’

I find this statement entertaining, since the only reason the project exists is to achieve business benefits. Project managers need to have the business needs as the project objective. If it appears the project will not be done on time and meet the objectives - speak up, early and often. Bad news does not get better with age. Part of developing that understanding will be having useful business metrics, and those may not be easy to find. People in the IT industry are often satisfied with metrics that are easy to collect. People in seats, effort spent...

One thing I determined long ago was that most users “know it when they see it.” Putting all the requirements on paper and beating the user over the head with the documentation is rarely a good idea. Flexibility is required in order to do something useful - plan for it. Contracts may need to shift from hours spent to value delivered. If the real value is there, it can be measured and tracked. If it is not there, it's better to stop the project early.

One of the implications of having a more model driven business that assembles solutions is that it will be a more responsive and value based approach. The traditional project management techniques may need to change significantly to remain viable.

I wrote an entry a while back about metrics. Bill Phifer (one of the other EDS fellows) provided me with these thoughts. Unless carefully considered and monitored, metrics themselves can easily become dysfunctional; Robert Austin (Measuring and Managing Performance in Organizations) likens this condition to gremlins flying an airplane while at the same time giving the pilot what looks like good operational data to believe he is on course. People do tend to understand the metrics that they are measured on, and over time usually find a way to game them to their advantage. That doesn't mean that metrics are bad, only that they need to be carefully collected, stored, analyzed, interpreted, reported and monitored in such a way that they measure the process, not the person.

One reason that fewer projects fail nowadays is because they are typically smaller and shorter; gone are the days of the monolithic 12-24 month project. The industry has learned that most successful projects are completed with fewer than six people and in less than six months - and that smaller project size also allows for more of the hands-on project status and constant communication that you talk about. It also supports most of the core techniques of agile programming methods. The speed of new business innovations as well as new technology integration was also a factor, as these introductions often made a major "new" system obsolete before it was completed.


Posted 11-30-2005 2:08 AM by Charlie Bess
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Comments

Dennis Howlett wrote re: IT project failures
on 11-30-2005 5:56 AM

There are so many possible threads from here. (Sigh)

I've oft felt the reality of managing humungous projects is far harder than many imagine. Charlie confirms that theory. There really isn't 'one size fits all.'

But I wonder whether Charlie wants it both ways. In saying 'Contracts may need to shift from hours spent to value delivered. ' I wonder for instance if Charlie is missing an opportunity to put a clear stake in the ground.

What's wrong with recognising the issue for ALL parties and determining that future contracts will reflect that value element? So ditch the time and hours idea.

How about recognising the imbalance between private and public sector expertise (for example) is not helping to develop the organisations needed to 'bail out' when necessary. What happens here?

Chui Tey wrote Methodology
on 11-30-2005 11:40 AM

Here are my top three

1. Absence of governance methodology

2. Legislated to fail

3. Interdependent project hell

If a project does not have any criteria to determine whether the plug should be pulled, then it is bound to continue on it's on inertia.

If the project implementation are prescribed by legislation, then a lengthly phase-in is almost impossible, since the project has already failed by definition.

If a major project starts to falter but partners have already started working on their internal projects in anticipation of the major projects' API, then the project cannot be killed. This can lead to cost blowouts.

David Terrar wrote re: IT project failures
on 11-30-2005 10:42 PM

Dennis's first reference to the 'The Next Big Thing' and your subsequent conversations were in a thread from an AccountingWEB piece EDS settles Tax Credits claim for £71m.  I agree with most of what you say here, but I notice you haven't referenced that particular project in your examples, although I would guess you discussed it with him.  Any particular reason?

Charles Bess wrote re: IT project failures
on 12-01-2005 1:35 AM

There are some good points brought out by these comments that I definitely agree with.

David - I definitely did not talk with Dennis about any contract or contract issue. Those in the service sector know that the relationship is based upon trust and I would never betray that trust of a current or former clients of EDS. Hopefully that's clear. I saw that implied relationship between conversations and thought it unfortunate, but those things happen.

Dennis - I agree that all contracts should focus on value wherever possible, since that is their reason for existence.

David Terrar wrote re: IT project failures
on 12-01-2005 5:11 AM

Charles,

Thanks for publishing the link back to the AW thread - I can see you are prepared for open debate, which is great.  I understand what you say about client confidentiality, which is also good.  As Dennis says, managing major projects needs serious skill - and on both sides of the relationship.  Our government IT representatives seems to be sadly lacking in that at present.  Putting management expertise aside for a moment, the most successful projects I've been involved with have often had risk/reward elements written in the contract, so the joint focus and objectives are kept aligned throughout - maybe that's the appropriate compromise between a pure focus on either value or time & rates.

Vinnie Mirchandani wrote re: IT project failures
on 12-07-2005 11:41 PM

Charlie, while projects may be becoming smaller (not universally) - your and other sales forces do not like that trend. They are still incented to shoot elephants. That misalignment needs to be fixed.

Also, outsourcing (as against project)  deal size is growing and performance there is inconsistent.

see my post discussing your point and some trends I see at

dealarchitect.typepad.com/.../fewer_it_projec.html

Michael Krigsman wrote re: IT project failures
on 04-21-2006 8:39 AM

Charlie, thanks for the great post. It's astonishing how often IT project leadership 'forgets' the connection between their project and the business.

On one level, the point is obvious on its face. At the same time, you have identified a root cause for many project failures. So, clearly, the point is not as obvious as it seems.

I have posted a comment on this article here:

projectfailures.com/.../sometimes-the-obvious-needs-to-be-stated.html

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