Make IT happen
Why do IT projects fail? Helen Brown looks at a recent roundtable discussion to find out
Hiscox shared its insights on avoiding IT project failure at a roundtable discussion jointly hosted with Computer Weekly, the leading UK magazine for IT professionals.
Headlines about sinking government IT projects, with their spiralling budgets, poor relations with management and failure to deliver, have brought the risks of such projects sharply into focus. The roundtable allowed industry experts to talk about their concerns and strategies with Alan Thomas, Hiscox’s Product Head for Technology and Media. “It’s inevitable that Hiscox, as a specialist insurer of technology companies’ professional indemnity, has seen a number of project failures and the disputes that follow,” he says. “In the worst cases, these can involve redundancies and serious harm to firms’ reputations.”
Cause effect
Hiscox has identified five main reasons for IT project failure. The first and perhaps most common is the temptation to begin a job too early. “Excessive eagerness to start the job often limits the crucial process of due diligence,” explains Alan. This could result in both customers and providers underestimating the complexity of the task – causing ambiguous contracts, unrealistically short timescales and overspend on resources. All major areas of uncertainty should be resolved before a contract is signed.
Another common pitfall is the contractor and client not working closely together – including involving key stakeholders at the right times. It may be that poor planning has meant that buy-in from the user has not been secured early in the process. Good project management will secure these valuable buy-ins, and marshall projects through the testing times.
People power
Relationships and staffing lie at the heart of a project’s success. Yet such relationships are difficult to enshrine in a contract and are therefore frequently ignored. A further danger is created when contractors, eager to submit as low a bid as possible, omit key personnel such as contract administrators and risk managers from a pitch.
The problems created by corner-cutting and unrealistically low pricing cannot be overestimated, says Alan. But the tendering process itself is partly to blame. Clients often fail to fully scope their requirements in the rush to justify the business case to senior management.
In many cases, if clients conducted more thorough research, they would be better placed to evaluate submissions. The Request for Proposal process should contain agreed selection criteria, which remain immovable throughout the project, providing a strong framework within which to prioritise issues as they arise. This also reduces the likelihood that funding is removed halfway through when, for example, those people involved in risk or contract management are cut from the project.
