By Renee Oricchio
There was a time when companies tackled their IT projects in two steps: place an order and then wait for the results. Those days are all but gone. While the old project management "two-step" may be simple, it doesn't work.
In fact, study after study shows the vast majority of IT projects still don't fully measure up. According to KPMG's most recent global IT management survey, only 2% of the companies surveyed reported achieving targeted benefits consistently from their IT projects. 49% had experienced at least one total project failure within the past 12 months.
"IT people still face a big credibility gap. Every CEO has been burned," says Bill Huber, a regional practice leader from the consulting firm Tatum. "It's often very hard for them to give their CIO the benefit of the doubt on the next project."
The good news is that the numbers may be getting better. The Standish Group, known for its widely monitored CHAOS report that also tracks success and failure rates, is still in the process of updating and publishing its survey for the first time in two years. However, company chairman Jim Johnson describes what he's seeing in the industry as "really encouraging, very optimistic."
Johnson specifically credits three improvements:
- Agility IT managers are less inclined to get locked into plans and are more likely to build things out incrementally. All this makes it easier to make timely changes along the way.
- Tech Savvy End Users "Users outside the IT department are smarter and know more about what they want in the first place," Johnson says.
- Greater Accountability and Discipline Project management is finally getting its due respect as a proven discipline. More companies are installing project management offices (PMOs) either within the IT department itself or managing IT projects across departmental lines. "It doesn't matter who the PMO reports to, what matters is the standardization and methodologies it brings to the project," says Lewis Cardin, a senior analyst from Forrester Research.
Developing a strategy for success
It's usually no surprise when a project falls short. Warning signs usually come in the form of missed deadlines, budget overruns, and "soft" launches that land with a thud among users.
In the past, IT projects tended to be thankless jobs. Meaning, the only time IT managers heard from the rest of the organization was when something didn't work or cost too much. Those days are ending.
CIOs are now finding themselves in a position to be the company savior -- the only department in a position to streamline the business with fewer people, as well as leap frog over the competition by boosting revenues and reaching new markets through new technologies.
It hasn't happened by accident, however. Just as employees outside the IT department have become more tech savvy, IT managers have become more business savvy.
"IT has gotten better at learning what business they are in," says Huber.
Successful projects have their commonalities. Experts advise IT managers to practice the following techniques in order to ensure IT project success:
- Joint Vision and Ownership "What helps make a successful project is identifying where the value is for both IT and the rest of the company," Cardin says. "Everyone needs to take ownership and have a vested interest in its success."
- Solid Planning This means a clear agenda, measurable expectations with a timeline of set benchmarks, careful delegation of responsibilities and performance oversight, along with realistic budgetary expectations.
- Strong Governance Cardin recommends every project must have a steering committee with representation across departmental lines. Members have to come from senior management with the gravitas to hold all participants accountable.
- Project Financing Not only does this mean a well thought out budget, but one that includes a strategy to release funds as needed based on the arrival of key deliverables.
- Risk Management "There's no such thing as a project that executes as planned," says Cardin. With that in mind, project management teams need to raise possible red flags in advance. This includes areas that could result in added expense, delays, changing needs, and any external forces that could impact the project itself.
- Sound Project Management Whether it's executed by a formal PMO, a diligent management team, or even some of the more sophisticated project tracking software, a disciplined approach "allows you to look at all your projects and make the best choices for staffing, as well as prioritizing resources," says Huber.
CIOs need to understand that the business depends on making IT projects a success and they need to work with other departments to help avoid obstacles. "There's no longer a wall between IT and the rest of business," Cardin says. "Collaboration is everything."
For companies that haven't made the leap, such a shift in thinking for the CIO is only the first step. The second step is bringing the rest of the company around, as well. Consider it the new two-step.
Renee Oricchio is a freelance writer in Norwalk, Conn. For the past 20 years, she has been writing and producing news segments about technology and business for CNN, MSNBC, Ziff-Davis, CNet, and a variety of Silicon Valley-based local news outlets.