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Most of the stakeholders, consultants and project managers have made up their personal opinion about the ultimate causes of failure of IT projects. Their conclusion is, at best, partial and fragmentary and, at worse, strongly biased by their area of expertise. Even with comprehensive experience they have but been exposed to a small sample of project failures as compared to the [sky high] number of projects that fail. Even very experienced project managers are confronted with unmet situations. There are no two identical combinations of IT project scope, objective and environment.

The following surveys - some of which have also been presented in the statistics over IT failure rate - are an attempt to bring some objectivity in assessing the causes of IT project failure. This extends the number of the situations considered, but this also reduces the depth of insight or the acumen of the analysis that one gains by going through a full project lifecycle. The results of the following surveys are presented on this web page : 

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The Bull Survey (1998)

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The KPMG Canada Survey (1997)

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The Chaos Report (1995)

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The OASIG Study (1995)

The Bull Survey (1998)

In 1998, the French computer manufacturer and systems integrator, BULL, requested an independent research company, Spikes Cavell to conduct a survey in the UK to identify the major causes of IT project failure in the finance sector.

Scope of the Survey

A total of 203 telephone interviews were conducted with IT and project managers from the finance, utilities, manufacturing, business services, telecoms and IT services sectors in UK. All the managers interviewed had previously taken the lead in integrating large systems within organizations in the Times Top 100.

Project Evaluation Criteria

The main IT project failure criteria identified by the IT and project managers were:
bulletmissed deadlines (75%)
bulletexceeded budget (55%)
bulletpoor communications (40%)
bulletinability to meet project requirements (37%).

The main success criteria identified were :
bulletmeeting milestones (51%)
bulletmaintaining the required quality levels (32%)
bulletmeeting the budget (31%)

Key Findings

The survey  reveals that the major causes of project failure during the lifecycle of the project are a breakdown in communications (57%), a lack of planning (39%) and poor quality control (35%).

Failure Cause Survey.264.gif (9996 bytes)

For IT solutions delivered by an external supplier, the client - supplier relationship is considered as very important to the success of the project. Again, communication is seen as key to making this relationship work by 60% of those surveyed. End user acceptance of the project is seen as vital by 91% of the IT managers surveyed, with communication strategies identified as the way to manage end user and client expectations. Other important points to the project success were the professional skills of the people on the project team (59%). 37% believed that the supplier's honesty is key.

The key criteria when selecting a supplier according to those in the finance sector are the supplier's expertise (47%), confidence in the people on the project team (43%) and confidence in the supplier (36%). Value for money is seen as less important with just 26% of respondents selecting this criterion. This shows that risk management is highly valued among project managers in the finance sector with 96% believing it is vital to identify an appropriate risk strategy, and 66% believing a contingency plan is always necessary in project management.

IT Cortex Comments

A typical difficulty in conducting that kind of survey resides in structuring the information when making the questionnaire and when consolidating the results. In the BULL survey the most frequently cited causes could be actual causes but are also ... consequences or ... symptoms.

For example, "Milestones not being met" (34 %) looks more like a consequence. It is even considered as the top failure criteria by the participant to the survey. An element cannot possibly be both a cause and a criteria for that cause. Similarly, "Costs getting out of hand" are both cited as a cause (26 %) and as a key failure criterion. "Insufficient measurable outputs" looks more like an outcome than a cause.

Another problem is the overlap and the redundancy of the causes cited. "Lack of planning", "Inadequate coordination of resources", "Mismanagement of progress" and "overall poor management" could all fall into one category that could be called "Poor project management". If this merge between categories had taken place, would this merged category score higher than the "Bad communication" category? Structuring information for a survey also means defining atomic or unit pieces of information against which precise questions are asked. By essence atomic causes do not overlap each other.

The role that people play in an organization creates always a significant bias in a survey. It is in the nature of people to believe that the responsibility for failure lies outside their scope of control. If a survey is conducted with IT directors they are more likely to blame a failure on the end-users and/or the supplier. Similarly, end-users will blame it on the IT department, on their management and/or on the supplier. The supplier will blame it on its customer (for example on its insufficient commitment, on its delay in validating the specs or on its changing requirements).

The failure and success criteria - as defined by the interviewees - are pretty unsophisticated (see IT Cortex comments on project failure criteria) which significantly reduces the depth of insight into the causes of failure.

An interesting observation is that the respondents attach more importance to milestones being met (51 %) than to budget being respected (31 %) thereby showing that time is even more precious than money.

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The KPMG Canada Survey (1997)

This study, conducted by KPMG Canada, has been mentioned in the statistics over IT project failure rate

Key Findings

The main causes of project failure that were identified were:

  1. Poor project planning. Specifically, inadequate risk management and a weak project plan. Risk management becomes more important as the organization gets bigger, so larger organizations need to pay more attention to this area.
  2. Weak business case. The need for the system should be justified in ways that relate directly to the organization's business needs.
  3. Lack of top management involvement and support. This often dooms the project to failure before it starts. Securing buy-in from the top, often by a strong business case backed up with a realistic project plan, is an essential step.

Additional findings

bulletProjects fail more often because of schedule overruns than budget overruns.
bulletMany projects fail because they use new or unproven technology.
bulletPoor estimates or weak definitions of requirements at the project planning stage also contribute to project failure.
bulletProjects can run into trouble due to the vendors' inability to meet commitments.
bullet60 % of the failed projects were planned to take less than one year to complete.

IT Cortex Comments on the KPMG Survey

The bias introduced by a 12 % answer rate (176 out of 1450) is of course unknown. Do people answer out of pride or resentment ?

The category "poor project planning" can be quite broad. Beyond producing a project plan, it can also cover the scoping of project, the allocation of project resources, the communication plan. More atomic items could prove to be more enlightening. An interesting observation about project planning is that, if this is identified as a project weakness jeopardizing the project outcome, producing a comprehensive project plan is never sufficient to bring back the project to normal.

The quality of the project business case and the top management commitment are always critical success factors. Strategic IT projects are in the first place company-wide business projects. Time appears also to be of more value than money in this survey.

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The Chaos Report (1995)

The scope and approach of this landmark survey has been presented in our overview over the rate of IT project failure. It has been conducted among 365 IT managers from companies of various size and in various economic sectors. 

Project Evaluation Criteria

The main IT project failure criteria considered were:
bulletCost Overruns
bulletTime Overruns
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Content Deficiencies

Key Findings

Opinions about why projects are impaired and ultimately cancelled rank incomplete requirements and lack of user involvement at the top of the list.

Project Impaired Factors % of  the Responses
1. Incomplete Requirements 13.1%
2. Lack of User Involvement 12.4%
3. Lack of Resources 10.6%
4. Unrealistic Expectations 9.9%
5. Lack of Executive Support 9.3%
6. Changing Requirements & Specifications 8.7%
7. Lack of Planning 8.1%
8. Didn't Need It Any Longer 7.5%
9. Lack of IT Management 6.2%
10. Technology Illiteracy 4.3%
11. Other 9.9%

IT Cortex Comments

This survey is probably one of the best available by its breadth and depth. 

Only one occurrence of the "Project Impaired Factors" has been considered in the statistics (they add up to 100%). In reality, there may exist multiple causes. IT project failure is more like a syndrome, i.e. it has multiple symptoms and origins. If more than one cause contributes to the failure of a project then all causes should be weighted proportionally to their respective contribution and added up. It is likely that this would change the global picture. This raises again the issue that only atomic causes should appear in the statistics.

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The OASIG Study (1995)

This is the same survey as the one listed in the statistics over IT project failure rate. It has been conducted in the UK among 45 experts issued from universities and consultancies.

Project Evaluation Criteria

The participants of this study recognized the difficulty of:

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determining clear project success or failure criteria (see IT Cortex outline of that topic)

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gaining hard evidence of the success of a project

The prominent failure element considered were:

bulletthe extent to which new systems are delivered on time and within budget
bulletthe fact that the new technology investment has been abandoned
bulletthe extent to which the new systems met expectations and gave value for money.

Key Findings

The main reasons why systems fail to meet their objectives were identified as:
bulletLack of attention to the human and organizational aspects of IT.
bulletPoor project management.
bulletPoor articulation of user requirements.
bulletInadequate attention to business needs and goals.
bulletFailure to involve users appropriately.

In general IT failures are rarely considered as purely technical. The integration and mutual influence of organization and IT is emphasized throughout the OASIG study.

IT Cortex Comments

This study does not gather hard facts and figures: this is both a plus and a minus point. It is an advantage because it conveys all the insight into the causes IT project failure of those 45 experts. It is a disadvantage because it provides the consolidation of subjective appreciations. One can argue that this subjectivity cancels out across the whole statistical sample. But, even among experts, there are fashions that can bias the outcome of a survey.

The results of this survey are actually the most congruent with the experience of the IT Cortex consultants. This is probably due to the fact that the experts surveyed are issued from the world of business consultancy.

IT Cortex Conclusion

The success of an IT project results from a blend of numerous and demanding conditions . The overview of those conditions - as provided by those surveys - is always worthwhile reviewing before and during the course of a strategic IT project.

Underlying all those studies is the lack of synergy between IT and organization (in the broad sense of it, i.e. encompassing strategic, tactical and operational aspects).

The top causes of IT project failure are different in the different studies, probably highlighting a bias toward the key aspects that each organization having conducted those surveys wants to stress.

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IT Cortex

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