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Why IT projects fail - 10-06-2007
UK companies are spending an estimated £5.81 billion on technology that does not meet business needs because 75 per cent of all IT projects fail to meet deadlines or budget requirements.

This is a figure that could be slashed by more than a third if more attention was paid to user adoption and training, according to new research. It is the people factor that makes the difference, between project success and failure.

These figures are based on Forrester’s estimated UK IT spend of $77 billion (£38 billion) in 2006. Gartner research shows that 20 per cent of IT budgets are spent on application development. PricewaterhouseCoopers believes that 75 per cent of IT projects fail, meaning that £5.81 billion is being paid out unnecessarily by UK organisations.

Seven out of ten UK government projects fail – despite a £14 billion annual spend on IT [3]. This figure is estimated to be similar in the private sector with the Standish Group maintaining that only 34% of all IT projects are successful. AMR Research found that even amongst successful CRM implementations, 47 percent of companies reported serious challenges with end-user adoption that often put projects in jeopardy.

This focus on the human factor is backed up by industry analyst statistics. 85 per cent of project success is dependent on factors related to people. Gartner believe that 17 per cent of ERP implementation budgets should be dedicated to training and that the companies that spend less put projects at increased risk of failure.

“The statistics on IT project failure in the UK make depressing reading – no wonder that many organisations are suspicious of the perceived benefits of technology,” commented Adrian Palmer-Geaves, CEO, Knowledge Solutions.

“Training and certifying users to ensure that they understand and therefore adopt new systems is often overlooked in the rush to get systems delivered on time. IT project managers need to ensure they give the human factors more emphasis if they want their systems to truly deliver business benefits after they go live.”

Palmer-Greaves suggested six key areas to focus on to increase user adoption:

  • Change communication – get users on side by merging internal project communication with web based simulations of the new system. This allows users to see and ‘try out’ the new application weeks or months before it actually hits them. Demystifying the system helps users overcome any fears they may have and manages their expectations of what the new system can – and cannot – do.

  • Balance training methods – blend online simulation training and user testing with a lesser quantity of face to face or instructor led sessions to provide the optimal mix of knowledge delivery and assessment.

  • User documentation – ensure that you have comprehensive and tailored user documentation to back up knowledge transfer and provide a foundation for future operations. For too many projects user documentation is completed late if at all.

  • Refresher training – run individual, simulation based training, tailored to job roles, ahead of go-live to ensure that every user understands and can use the system efficiently. Providing facilities for users to practice between face to face sessions and go live ensures that their knowledge remains current and that key skills are practiced before they are lost.

  • Certification – incorporate thorough testing of user ability and capture this information to provide accurate reports on the progress and effectiveness of the ‘knowledge transfer’ phase of the roll-out.

  • Business process support – after systems go live users need support through in-application help that can be accessed quickly and is tailored to their roles. The documentation and system simulations can be linked to the live application to provide ongoing support and automatic notification of key changes to operating procedures without needing major retraining programmes.

“Given that over 60 per cent of IT systems fail because projects neglect the organisation and people changes introduced by new technology, efficient knowledge transfer systems should now be vital parts of every IT project,” concluded Palmer-Geaves. “Only then will it be possible to reduce the enormous £5.81 billion cost of projects that do not meet the needs of UK organisations.”
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