Large-Scale IT Transformation: Ensuring Success
The decision to embark on a large-scale IT transformation initiative (>£10 million) usually has business leaders feeling a tad nervous. Their worries are not totally unjustified. According to one large study, the chances of delivering such a project successfully—on time, on budget, and with the desired technical objectives met—are roughly one in ten. The cost of failure can be considerable: we have heard that the potential lost value from a major project delay, for example, can range from 100 – 170 % of the investment cost.
However, companies cannot run from the challenge. IT underpins an increasing percentage of essential business transformation initiatives, such as the establishment of digital business models and big-data capabilities. The need for substantial IT investments can also arise when large supplier contracts expire or legacy IT systems reach the end of their lives. Large-scale IT investments are therefore unavoidable.
Can steps be taken to materially improve a large IT project’s chances of success? The answer is an emphatic yes—assuming that executives know where to focus their efforts.
Why Do So Many Large IT Projects Run into Trouble?
Large IT projects are vastly more difficult to deliver successfully than smaller ones, because a project’s complexity, interdependencies and communication challenges grow exponentially as the project grows in size. What works well for the execution of small projects rarely suffices for the execution of large ones.
Although every major IT project and its circumstances are unique, projects that are flagging often have common characteristics.
- Inexperienced Project Teams.
- Lack of Engagement/buy-in from Key Client Stakeholders.
- Requirements That Are Unclear or Too Complex Relative to the Business’s Needs.
- Insufficient Attention to Major Risks.
- Taking the Solution Live Without Sufficient Testing.
- Failure to Manage the Project Plan Effectively.
- Insufficient Attention to Change Management.
Any one of these conditions can be enough to undermine a project; more commonly we hear that unsuccessful projects are down to several.
Setting the Project Up for Success
Business sponsors and the c-suite can take a number of steps to maximize the odds of a large IT project’s success.
- Challenge the decision to proceed with a large project; if possible, try to break the effort down into smaller, more manageable chunks, or “releases.”
- Get the right project leadership in place early.
- Make sure that the project team spends time up front defining and gaining clarity on the project’s scope, high-level business requirements, benefits, and costs.
- Select a vendor that has done a large project of this type before, if possible, establishing the right contract.
- Work to engage client stakeholders, promoting a positive culture on-site.
- Confirm that the project’s risks are being proactively managed.
Given today’s rapidly evolving business environment, the ability to deliver large-scale IT projects successfully stands to become an increasingly critical competitive differentiator for companies (as well as an increasingly used yardstick for gauging the performance of leaders, including CIOs).
The levers discussed above should be viewed as essential enablers of any such project.