IT Project Disasters
High Profile IT Project Disasters In Australia
Excellent article in the ABR detailing some high project disasters, what they were, why they went wrong and why customers need to take more ownership and accountability
Key Call Outs
65 to 85 per cent of IT projects fail to meet their objectives or run over-time or over-budget. The average cost blowout is usually between 50 per cent and 100 per cent.
A further 30 per cent of IT projects are cancelled.
How To Avoid IT Disasters when Outsourcing
The top line recommendation is to not wash your hands of a project when you outsource. It needs to be a collaboration or the vendor will fail. You need to take responsibility for setting the vendor and the project up for success. A strong project director will help with this process.
1. Requirements - Do not overly simplify or un-disclose known challenges or concerns
2. Legals/KPIs/Measures of Success - Expectation setting is very important.
3. Costs - Realize it is important for the vendor to make a profit. Under-quoting is a problem, do not set yourself up for failure by going with a non viable quote, it will come back to bite you.
4. Services/Roles and Responsibilities - Need to be detailed and documented
5. Governance - After RFP and vendor selection governance is YOUR responsibility.
6. Blame - You need the project to be successful, choice vendor wisely and help them suceed, collaborate
7. Margin for error - Mistakes are normal and life, allow for them in budget and schedule and govern them carefully
9. IP - Key contractual issue - should be documented and jointly signed
10. Penalties and Bonuses - Motivate your vendor with carrots and sticks
11. Exit Strategy - This must be discussed upfront and documented, this should be carefully planned in case things go wrong