• On average: one-sixth of the projects were completed on time and within budget.

• On average, at the point a halt was called, the failed projects were:

– 189 percent over budget;

– 222 percent behind schedule;

– Contained only 61 percent of the original specification.

1. Lack of a clear link between the project and the organization’s key strategic priorities including agreed measures of success;

2. Lack of clear senior management ownership and leadership;

3. Lack of effective engagement with stakeholders;

4. Lack of skills and proven approach to project management;

5. Lack of skills and proven approach to risk management;

6. Evaluation of proposals driven by initial price rather than the long term; value for money (especially securing delivery of business benefits);

7. Inadequate resources and skills to deliver the total project.

• Deadlines not met;

• Budgets overspent;

• Quality worse than expected;

• Core business processes negatively impacted;

• Absence of innovation;

• Increased transitional or operational costs;

• Damaged reputations;

• Weakened competitive position.

1. Ensuring real business value: any project must be linked to key strategic business goals, must strengthen the business model and project plans must continue to be aligned with business objectives – and, in a rapidly changing business environment, failure in this single aspect can often signal failure overall;

2. Controlling cost: centralized program and project management resourcing enables the organization to monitor and – through standardization and use of existing infrastructure - control costs more effectively – and dynamic budgeting, which allows for rapid re-alignment of expenditure, is a discipline that is appropriate for critical projects that are taking place in a fast changing environment;

3. Resource maximization: high-value internal (and external) resources can be allocated as appropriate to conflicting projects in a way that helps, rather than hinders, the business – and, in a rapidly evolving business environment, resource maximization is a dynamic discipline;

4. Risk management through portfolio balancing: the organization can assess (preferably on an ongoing basis) the range of risks, resource requirements and cost requirements across all its projects and implement appropriate controls to keep its overall exposures within its preferred tolerances;

5. Uniform application of best practice: the organization can ensure that those techniques, processes and skills that are most likely to ensure success in its project portfolio are applied across all its projects.

PRINCE2

The deployment of Prince2 (or any other recognized and comprehensive project management methodology), while not, of itself, sufficient to ensure successful project execution, is a pre-requisite. Deployment of Prince2 can only be effective where the internal customers, the users, have been fully trained in their role and where the organization’s programme office (if there is one) is independent of the IT function – usually reporting directly to the CEO.

Prince2 projects that are implemented outside a clearly defined IT governance structure are as likely to fail as are projects that have no formal project management methodology.

6. Organizational coherence: the organization can ensure that all projects adhere to the organization’s agreed IT enterprise architectural standards, cross-organizational policies and procedures, and the business model.

• Corporate or strategic (political, commercial, financial, environmental, cultural) risks that can derail a project, however well it is being handled at all the other levels;

• Programme (expertise, funding, procurement, organizational, security, safety, continuity) risk is a combination of external and internal factors;

• Project (expertise, technical, scheduling, quality, providers, resource) risk is directly execution-related;

• Operational (expertise, cost, scheduling, quality, infrastructure, culture, processes, other parties) risk arises more from the challenges posed by an existing infrastructure and other demands on any of the parties to a project than it does from a narrowly defined failure of execution. A successful project requires an appropriate operational environment.

1. Executive support (18 percent)

2. User involvement (16 percent)

3. Experienced project manager (14 percent)

4. Clear business objectives (12 percent)

5. Minimized scope (10 percent)

6. Standard software infrastructure (8 percent)

7. Firm basic requirements (6 percent)

8. Formal methodology (5 percent)

9. Reliable estimates (5 percent)

1. Ensure that the business reason for any project is clearly understood and communicated throughout the organization;

2. Ensure that the board and senior management actively support the project, and that authority and accountability are unambiguously defined at all levels;

3. Customize the organizational structure (ie the inter-related programme and project boards, user groups, etc) to ensure project success, break large projects down into components of a total programme which is actively programme managed, and ensure that a comprehensive change management methodology is deployed;

4. Carry out a thorough critical path analysis, within the overall project portfolio, to ensure that all project plans – particularly those that draw on the same resources - are realistic;

5. Develop and deploy an appropriate risk treatment plan that is integrated into the overall corporate risk treatment plan;

6. Deploy a recognized project management methodology, having first ensured that everyone involved in the project (including users and providers) are fully trained in the methodology and capable of providing their required input;

7. Ensure that the programme has adequate resources at all levels.

1. Recognize at board level that program and project governance is a ‘must have’, and that the board is accountable for approving project initiation, for managing the project portfolio and for expeditiously pulling the plug on under- or non-performing projects;

2. Make one or more non-executive board members specifically responsible – within the IT governance framework – for overseeing project governance, and enable them to have independent, informed oversight of progress on all business IT projects – including attending program (or large project) board meetings. If necessary, bring in external expertise to fill any board level knowledge gaps and ensure that the criteria by which the board will review project progress are SMART (specific, measurable, achievable, risk-measured and time-bound), clearly defined as part of the project planning and initiation process, effectively communicated, and acted upon;

3. Require clear, unambiguous identification of accountability at all levels of every project, with detailed and rigorously tested project plans based on a critical path analysis and that contain clearly identified critical success factors, regular milestones, clearly defined ‘go-no go’ checkpoints, with clearly specified and allocated resource that allows for a margin of error. Where necessary, insist that appropriately qualified and experienced staff are recruited or retained before project approval is given;

4. Ensure that every project proposal contains a full business case, with a fully costed (ie Total Cost of Ownership) estimate that can stand up to independent audit, with clearly stated assumptions that can withstand rigorous analysis. Vague or aspirational assumptions should be immediately struck out of any proposal. Return on Investment criteria must be the same as those applied to any other investment decision and the possible return on every project must be assessed in comparison to any other investment opportunities the board may have.

5. Ensure that the board and its IT committee has available to it experienced, independent professional IT advisers, and that their advice is taken and considered;

6. Manage all IT related projects as part of a portfolio, so that all the benefits (including the risk management ones) of this approach can be enjoyed and so that there is a widely understood strategic approach across the organization;

7. Adopt and deploy a recognized project management methodology, ensuring that everyone involved in the project (including users) is trained in it and has a full understanding of their roles and responsibilities;

8. Adopt a clearly defined, programme and project level, risk management plan that reflects the corporate level risk treatment requirements. Ensure that the risk management plan and selected controls are reviewed and confirmed on a regular basis;

9. Establish a monitoring framework that informs the board of progress and provides an early alert – not just of divergence, but of slippage in any of the critical success factors. Ensure that project monitoring includes a regular, planned review of the assumptions that were fundamental to adoption of the project in the first place: is the project still relevant, are the reasons for pursuing it still as strong, and are the expected benefits still capable of realization? If not – and in a fast-changing business environment projects can be overtaken by events – the project should be pulled and resources redirected more appropriately;

10. Commit funding only on a phased basis. While the total funding requirement needs to be available at the outset of the project, funds for the next stage should only be released once this stage has been successfully signed off and the original project assumptions confirmed as being still valid;

11. Internal audit should include appropriately qualified and experienced auditors, capable of assessing and reporting accurately on IT projects, who have open access to all parts of the organization – and to any external contractors involved in the project. They should be accountable directly to the board for providing regular, timely and unambiguous reports on progress, on project slippage against planned milestones, budget, requirements specification and quality requirements. When internal audit identifies project divergence, the board should not release further funds until it is satisfied that the cause of the divergence has been fully dealt with.