IT Project Management Stinks Less
The percentage of successful IT projects has increased over the last decade; but there is still a lot of room for
improvement. Ask a CEO or CFO if he thinks one successful project out of every three IT projects is good enough.
A few months ago, I was conducting a workshop on improving IT project management. During the first part of the workshop, I focus on why so many major IT projects end up taking much longer than expected, cost much more than estimated or never deliver promised benefits.
One of the participants in the workshop was a young guy who thought he pretty much knew everything there was to know about managing projects. He had recently been certified as a project manager, so he was armed and dangerous.
As we were discussing potential project problems, he interrupted the discussion and declared that concerns about IT project management were being blown way out of proportion. To support his case, he cited the Standish Group's most recent CHAOS report. He said, "according to the Standish Group, the percentage of successful projects has more than doubled since 1994 and the percentage of project failures is way down."
As a facilitator, I usually listen a lot more than I talk, but there are times when I have to play the "I really know my stuff" card to establish my credibility. This was one of those times. Fortunately I was familiar with the CHAOS report, so I didn't miss a beat in responding to him. I don't have a photographic memory, so I was a little at risk in terms of the actual numbers from the most recent CHAOS report, but I knew my numbers would be close.
"Not everyone is familiar with the CHAOS report, so let me give you a little background," I said. "The Standish
Group is a Boston-based research firm that has been studying the performance of IT projects since 1994. I think they update the study every two years. There are some project management experts who think the Standish Group's estimate of successful projects is high and their estimate of project failures is low, but, for the sake of discussion, we'll use the Standish Group's finding."
I went on, "As I remember the numbers, their initial study in 1994 found approximately 16% of all software development projects were considered successful, meaning the projects were completed close to the original time and cost estimates and provided expected functionality.
"In that study, they found something like 30% of all projects were failures, meaning the project was never completed, and more than 50% of all projects were classified as challenged, meaning the project had cost or time overruns and/or did not provide expected functionality. They also found that $140 billion was wasted in the U.S. on projects that were not successful. Based on those findings, the consensus at the time was that IT project management stinks.
"Fast forward twelve years to the most recent CHAOS report. The 2006 report found that the percentage of successful projects had increased to about 35% and project failures had decreased to 19%. The percentage of challenged projects had dropped to slightly under 50%.
"The increase in the percentage of successful projects is certainly encouraging, but if 35% of all projects are considered successful, then two out of every three projects take longer than expected, cost more than estimated, lack required functionality - or are never completed. I think that says IT project management still stinks - but it stinks less than it did a decade ago."
As I finished, the most senior participant in the workshop jumped in. "He is right," she said. "Our executive team is convinced we don't know how to manage projects because we almost always come back asking for more money and/or more time to complete projects, and we frequently have to defer some of the planned functionality. It's no fun and I don't want to have to go back to them to ask for more of anything on our projects." With her comments, we were back on track.
My semi-rant over the Standish Group's findings and the sad state of IT project management accomplished its purpose. It reinforced the need to do a better job of managing IT projects - and it made the young project management expert realize the art of project management still has lots of room for improvement. Actually, he turned out to be a very positive participant in the workshop and we developed a strong mutual respect.
A lot of organizations have taken steps to improve their performance on IT projects, but many organizations seem
to accept the low success rate on IT projects as some sort of unalterable fact of IT life. It isn't.
Successfully completing IT projects takes hard work and you have to know what you are doing. In my workshops, I
focus on 17 keys to project success. There is no magic in the factors I focus on. Most successful project leaders
focus on most or all of the same factors.
The secret to success with IT projects is learning how to effectively drive projects and being willing to put in
the effort it takes to successfully complete projects. Until more organizations are willing to make the commitment
required to effectively manage projects, I'm afraid we are going to see only incremental improvements in the success
rate of IT projects.
Bruce Skaistis is the founder of Skaistis Consulting. He began his career as a consultant with Arthur Andersen and was CIO of a large bank group before forming his own management services firm.
Skaistis Consulting provides specialized support to help organizations successfully complete critical business and IT initiatives, optimize outsourced functions and maximize enterprise IT value. You can find out more about Skaistis Consulting at www.skaistis.com.
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