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Seven Reasons IT Projects Fail

Avoiding these pitfalls will help ensure success

It’s interesting to explore the reasons IT projects fail. It immediately raises the converse question: Why do they succeed? Perhaps that’s the more important question. For that reason, it’s not enough to only examine reasons for an IT project’s failure but what can be done to improve the chances of success on future projects.

According to “Improving IT Project Outcomes by Systematically Managing and Hedging Risk,” a 2009 IDC report by Dana Wiklund and Joseph C. Pucciarelli, 25 percent of IT projects fail outright. Meanwhile, 20 to 25 percent don’t provide ROI and up to 50 percent require material rework.

Sound familiar? You’ve probably observed projects that, even if they weren’t outright failures, didn’t meet their financial objectives or required significant rework in at least one area.

In reviewing literature on project management, some factors emerge that influence the success or failure of a project (see “Five Areas Influencing Project Success or Failure”).

By categorizing documented causes of IT project failure, a majority—54 percent—are attributed to project management. Surprisingly to some, technical challenges are the least-cited factor at 3 percent.

Project management disciplines have been a part of IT for many years. So why are so many challenges still directly associated with how a project is managed? The issues often boil down to seven main reasons for project failure. By delving deeper and identifying potential pitfalls, we can see what can be done to avoid these missteps and improve the chance of success.

1. Poor Project Planning and Direction

Improving project planning and direction is one of the key factors in IT project success. This requires a method made up of rules, processes and tools for project planning and management, supported by a software tool. It’s important to remember the Four Ps—pilot, phase, parallel and plunge—and, certainly, don’t plunge under any circumstance.

A vital part of planning is to assign the right people to the right task and make clear assignments to team members, with defined goals and responsibilities. When assignments don’t work out, adjust roles as necessary.

54 percent of IT project failures can be attributed to project management, whereas only 3 percent are attributed to technical challenges.

2. Insufficient Communication

Objective status reports, frequent contact with sponsors and business users, and involvement of such external parties as the hardware vendor are crucial to avoiding the communication breakdowns that can derail IT projects.

Simple actions matter, such as organized agendas, minutes, action items and information-push emails. Agendas force the project manager running the meeting to organize the time and supply preliminary materials. The thinking and preparation that goes into creating the agenda are more important than the agenda itself. Also, mix up the way the message is delivered, especially for executive reviews. Using the same status presentation repeatedly might be an efficient method, but it could also be missing necessary diversity to keep executives interested in the story behind the status.

3. Ineffective Management

Sidestep this pitfall by proactively managing changing objectives, goals and risks, coordinating efforts between the technology and finance departments, and measuring performance.

Implement a straightforward change-management process with estimating and approval steps. This should be a lightweight process, but one that also allows management to understand the impact of changing requirements on the project. Utilize a risk-management assessment tool to uncover risks that must be addressed during and after the project. Enlist a finance representative on the team and formalize a business case. Lastly, identify discrete performance measurements, like planned and actual task starts and completes, and include them in the status reporting.

4. Failure to Align With Constituents and Stakeholders

Building understanding and trust with constituents and stakeholders is essential to a successful outcome, particularly when these groups are in different organizations and might have varied measurements and motivations.

For greater alignment, target specific initiatives to ensure interlock and communication with stakeholders. This can be done through input-gathering meetings, communication to push information and activities to get sign-offs on work products. Early in the IT project, it’s useful to have at least one face-to-face meeting with key stakeholders and team members. A well-planned kickoff meeting, where relationships are developed, will support the project in later months.

5. Ineffective Involvement of Executive Management

The participation of an executive sponsor in key operational working sessions is crucial to establish priorities. Project kickoff is the best first meeting, but it doesn’t end there. Executive involvement must be targeted for specific status meetings to monitor project progress, particularly in meetings where go/no-go decisions must be solicited.

6. Lack of Soft Skills or the Ability to Adapt

To prevent a situation in which team members lack the necessary skills for the project, utilize a mentoring approach for less-experienced employees. Also, include required education in the overall project schedule. Actively recruit skilled personnel through internal and external routes like jobs systems. A good outcome will not result without sufficiently skilled people.

7. Poor or Missing Methodology and Tools

Successful projects are based on a methodology or framework that includes project-management tools. This approach can increase accuracy and save time by automating activities like task tracking.

Maintaining a simple, organic methodology can have significant payback on a project. It should include the following:

  • Set up an electronic project notebook.
  • Establish written objectives for the project.
  • Work with the technical lead to establish tasks within phases.
  • Ask team members to estimate the time and number of tasks required.
  • Create a formal project plan and manage to it, including basic change control.
  • Proactively solve problems that may arise.

Finding Success

Improving the success rate of IT projects is possible by putting significantly more focus on general-management activities. It can be daunting at the onset of a project to know the odds indicate major retoolings or even outright failure. But with accurate planning, defined goals, clear assignments and effective communication, proactive managers can overcome those odds to master even the most challenging project.

Simply knowing where potential pitfalls lie can help prevent backlogs and costly delays in the future.