In recent weeks I have taken a look at the bankruptcy suffered by fire truck manufacturer American LaFrance due to what the company claims was a botched ERP implementation.
As a result I took particular interest in a report published this month by the British Computer Society on why IT projects fail. The report can be seen here.
The authors of A Study in Project Failure, Professors John McManus and Trevor Woods-Harper, looked at 214 information systems projects undertaken between 1998 and 2005 in the European Union and included follow-up interviews with project managers.
The overriding conclusion of that study, which probably doesn’t come as a surprise, is that only one in eight IT projects can be considered truly successful. Only those projects which met the original time, cost and quality criteria were considered successful.
In fact, of the 214 projects studied, 51 or 24% were cancelled.
So why do IT projects fail? The authors offer this summary:
“If we consider the inherent complexity of risk associated with software project delivery, it is not too surprising that only a small number of projects are delivered to the original time, cost, and quality requirements. Our evidence suggests that the culture within many organizations is often such that leadership, stakeholder and risk management issues are not factored into projects early on and in many instances cannot formally be written down for political reasons and are rarely discussed openly at project board or steering group meetings although they may be discussed at length behind closed doors.”
In other words, the authors suggest that even though companies have adopted sophisticated project management techniques and methodologies to steer and keep projects on track, strong executive leadership and project management skills are lacking in many organizations.
“Processes alone are far from enough to cover the complexity and human aspects of many large projects subject to multiple stakeholders, resource and ethical constraints,” they state.
The authors offer a long list of management and technical reasons behind project failures but among their key findings are the following:
• Business process changes (poor alignment)
• Business benefits not clearly communicated or overstated
• Overspends in excess of agreed budgets
• Poor project board composition
• Too big a project portfolio
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