Why Projects Fail

By Eric Lundquist, Editor-in-Chief

The possibility that the FBI may have to scrap its $170 million Virtual Case File software program was described by Sen. Patrick Leahy, D-Vt., in one report as a "train disaster in slow motion."

While big projects can fail in a spectacular manner, the same is often true for smaller corporate projects: for instance, the unused CRM system or the "integrated" inventory and manufacturing systems unable to talk to each other.

You'd think the government and the corporate world would be getting better at improving the success rate for software projects, but that does not seem to be the case. Why is that?

"The first question that comes to my mind when asked why software projects fail is, 'Why is common sense always the first thing to drop off the face of the earth in software projects?'" said Michael Krigsman, CEO of Asuret, a consultancy aimed at improving software implementations and reducing the risks associated with those projects.

Krigsman said failure of software projects has far less to do with insurmountable technology hurdles than with common business issues that should be addressed but often aren't before projects get under way.

"Does executive management support the project? Has that management committed sufficient resources in executive time and budget dollars to make the project a success? Is there a project management process in place? Has there been a business case made for the project? Is there an ROI analysis for the project? Have the project managers sat down with users and discussed the project?" Krigsman said, when asked what common-sense issues should be discussed.

When I asked one executive who has knowledge of government technology projects and procurement why the FBI's Virtual Case File has apparently flopped, he didn't want to respond on the record, although he did comment that the factors that ensure "successful projects are the same today as they were when I started my career in this field."

That career has spanned several decades, and, while the technology has changed considerably, he said the "same basics around project management and managing the human dimension with its expectations have not changed."

If the basics of managing technology projects have remained the same, you'd think that the number of successful projects is increasing. The technology choices are simpler than in the past. Instead of many networking protocols and software platforms, you're building your project on Internet-based networks using standards-based platforms.

The hardware has continued to become less expensive, more reliable and more network-friendly. Your options among in-house development, well-qualified local talent or offshore developers are more plentiful and affordable than in the past.

Despite such advances, in speaking with experts for this column, it seems the number of failing technology projects is as great as ever.

I don't know the details of the Virtual Case File project's problems, but I bet I can take a good guess: too much turnover at the top management levels, too many promises of what the software would be capable of doing and too little contact with the people who would use the software on a day-to-day basis.

Whether it be a high-profile government project or a sales force automation tool, not starting with the user in mind is one basic mistake sure to sink any project. A project that is on time, on budget and unused is still a failure. As Krigsman told me, "Running a project without reference to end users is insane and a prescription for failure."

Despite the gloom surrounding the track record of these technology projects, there are some signs of hope. For instance, the demands of regulatory compliance, ITIL (IT Infrastructure Library) and no-failure tolerance are providing IT governance products a role in technology projects from the start. "If key project dates and tasks are not being met, our products can drive a set of escalation alerts" to provide an early-warning system, said Christopher Lochhead, chief marketing officer for Mercury Interactive.

Risk Assessed

Does your company have a consistent framework for assessing the business risk of IT projects and initiatives?

Besides establishing payback tipping points for IT projects, companies in InformationWeek Research's Outlook 2005 study also are taking steps to understand the potential hazards of IT initiatives. For many, it's a standardized procedure. Three in five of the 300 sites surveyed have a consistent framework for assessing the business risk of IT endeavors.

Know the Risk

Letter from Michael Krigsman, CEO, Asuret

It's troubling that almost half the companies in InformationWeek Research's Outlook survey don't have a "consistent framework" for measuring the risk level of IT projects. But what's truly scary is that a high percentage of these projects end up as partial or complete failures. Isn't this the textbook definition of "reckless behavior"?

IT Project Management

User may know best when it comes to reducing risk in enterprise systems projects

Asuret, a Brookline, Mass.-based consulting firm, claims to have a solution for the problem of failed enterprise software implementations. It says the answer is to simply listen to the client.

Rather than maintaining complete reliance on experts, this services provider says it trusts its clients to identify and use their own expertise, and supports that with the right project methodology framework for systems implementation.

With some industry experts claiming as many as 70 percent of software implementations fail to meet stated goals, it might be time to consider a new approach.

"Even if most of these projects fail only partially, that still means thousands of budgets and schedules are running over, ROI targets are being missed, and products are being rolled out with less than their promised feature set," maintains Asuret CEO Michael Krigsman.

Krigsman says failures occur for literally dozens of reasons, but those considered most serious usually aren't the result of technical errors, such as with code.

"The real risk factors tend to be weaknesses in the organization itself—how projects are managed, how the culture works, how managers get feedback from end users," maintains Krigsman. "The moment something goes wrong with an implementation, these are the stress points where the whole structure is likely to cave in."

To identify and correct organizational weaknesses, Asuret recently launched this portfolio of risk-reduction services for enterprise software customers:

IT rapid risk assessments: Using proprietary, Web-based survey techniques and statistical analysis tools, exposure levels and relative importance of 46 risk indicators are measured. Project stakeholders subsequently discuss the project's most critical vulnerabilities.

Midpoint reviews: At major project milestones, previously identified risks are reviewed to ensure that new implementation issues have not surfaced. After-action reviews: Once a new application is up and running, project participants and end users explore lessons learned that can make future implementations run more smoothly.

Project management documentation: A formal record of decisions, changes, and outcomes is recorded.

Implementation playbooks: For larger organizations, internal best practices that may be widely scattered throughout the company are captured and documented.

"So many people are involved [in enterprise projects], each with a few key pieces of information that should be heard," concludes Krigsman. "Traditionally, risk analysts have either spent a fortune trying to interview everyone, or cut corners on the issues under investigation. We've tried to be smarter about developing tools for analyzing organizations and processes. "

Trendspotting: Fine-Tuning Adoption Efforts

By Nucleus Research

Successful deployments are all about adoption—and that doesn't mean a few hours of training and a pizza party. Solutions such as Asuret help you build consensus and identify potential change-management challenges before you start.

Enterprise software deployments are often 10% technology and 90% people, and those people can be just as effective roadblocks as enablers if the barriers to adoption aren't identified and addressed up front. Although different consulting firms have different methodologies to support change management, identifying where and with whom problems lie can often be a challenge. Asuret's analytical tools support rapid surveying of key stakeholders to determine who feels strongly about different change issues, and what those key issues are. Streamlining and automating the process for gathering that kind of intelligence potentially reduces bias and can help combat adoption challenges before they start.