Fortunately, companies can avoid technology train wrecks if they work with the proper mix of internal and external business and information technology (IT) specialists to design, install, implement, enhance and maintain state-of-the-art systems that are within their budgets and on schedule. Companies should recognize that it is communications, issues handling and conflict resolution that dictate the success or failure of a project.
Smart Business spoke with Paul Kanneman of Grant Thornton LLP to learn how companies can avoid technology train wrecks and keep their IT systems on track without hurting their bottom lines.
Are technology train wrecks more likely or less likely to occur in today’s sophisticated IT environment?
About 20 years ago, the failure rate of all technology projects was around 80-plus percent, which means that they missed on both budget and schedule. Since then, we have had a whole industry created around project management of large technology initiatives. But, depending on which survey you look at now, today’s failure rate is somewhere between 70 and 75 percent, with about 45 percent failing outright.
So we are not that much better off than we were 20 years ago when it comes to developing technology initiatives. The potential for technology train wrecks still exists.
What causes the disconnect between technology and business needs that leads to train wrecks?
We are dealing with two competing trends. Technology is getting more complicated, and the need for the rapid integration between it and different pieces of a business is growing more and more necessary. The problem causing train wrecks, however, may not be the technology. It is because all too often managers don’t have the discipline to answer up front before they even acquire the hardware and software components the necessary questions about what the technology can really do for their business. They should be asking questions like whether the technology is even required to do what they want and how it can do it. Answering those questions before acquiring the technology components goes a long way to help prevent technology train wrecks.
What else can help?
Three critical components for alleviating train wrecks are a much tighter integration between the business and technology communities, a focus on the organizational changes requiring IT initiatives, and an emphasis on project participants’ soft skills.
For example, closing the ‘air gap’ between the business and IT sides in a technology initiative is essential. IT people may not truly understand business needs, and the business people don’t grasp the technology and what it can and cannot do. They look at IT as a world of wizards who can make business solutions just happen. Misconceptions like that have to be eliminated.
Who should be working on technology initiative projects?
Companies that want to develop cost-effective, state-of-the-art information technology systems have to commit their top business talent to a project. Those people know what needs to be done and have the credibility and credentials to make the decisions required to make sure that it is. If management does not make that commitment, it is abrogating business decisions to IT specialists who may not be fully versed in the company’s business side.
Conversely, the best-qualified IT people should be assigned as well and they should have the required hard and soft business skills. Overall, IT experts are getting better at understanding the business side, but letting them make all the decisions can be a sure way to derail a project, if not to cause an all-out train wreck.
Do soft skills play any role in keeping a project on track?
Yes. Everybody involved in a technology initiative project should have two of the most important soft skills: conflict resolution and issue communications. They have to be able to resolve the inevitable conflicts that will arise on projects. If project members cannot communicate and resolve problems, all the well-designed project plans available will be useless. What gets projects completed successfully is communication and action, not plans. If the soft skills are not present on the project, all the bad assumptions, disagreements and conflicts will get put on the back burner just so everyone can make progress. More often than not, those issues never get resolved, progress becomes an illusion, and the project fails.
The success or failure of a technology initiative project does not rest on what a computer can or cannot do. Rather, it depends on defining what a computer can do, and that can only be done through clear, concise and consistent communications.
PAUL KANNEMAN is regional principal in charge of business advisory services with Grant Thornton LLP. Reach him at (214) 561-2256 or Paul.Kanneman@gt.com.