| | Large-scale IT projects
are cancelled
prematurely more often
than other types of
projects. Furthermore,
those that are not
cancelled frequently
last longer than
expected and therefore
exceed their budgets as
well. Roland Berger
Strategy Consultants has
conducted a study
entitled Keeping
projects on track with
launch management: Why
large IT projects often
capsize and project
success is not a
gamble. The study
analyses the reasons
behind this phenomenon
and describes strategies
with which IT projects
can achieve success. The
study is based on the
authors’ long years of
experience in managing,
restructuring and
reorganising large-scale
projects.
“A large-scale
project is more than
simply a project that
lasts longer, has more
employees and devours a
bigger budget,” explains
Dr. Kai Bender, partner
in the Roland Berger
InfoCom Competence
Centre, which conducted
the study. “Managing
large-scale projects
involves mastering
complexities on a scale
comparable to
medium-sized companies | |
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| | or even groups.”
Drawing on years of
experience, Bender and
partner Gerard Richter,
along with project
managers Matthias
Klinger and Dr. Claus
Herbolzheimer, have
developed an approach
for managing the quirks
and problems of
large-scale projects.
The risks: why
projects go awry
A glance at the
newspapers nowadays is
sufficient to discover a
host of failed large IT
projects. In fact, one
in five IT projects is
cancelled and about half
of them last longer or
become more expensive
than planned. One reason
is that nearly 50% of
projects have no one to
adequately attend to
managing risks and
operations. In addition,
the negative
consequences of failure
are often considerably
underestimated.
“In assessing the
damage from crisis
projects, it is mostly
only direct costs that
are included, whereas
the indirect costs are
often much higher,” says
Herbolzheimer. This
holds true particularly
for image damage. Good
project managers,
therefore, consistently
incorporate corporate | |
|
| | communication into
project activities. For
instance, language
guidelines and a
communication concept
for emergencies can be
drawn up in the
preparation phase. “What
sounds simple is no
longer the rule,”
laments Herbolzheimer.
Besides a lack of
risk management, a
further handicap of
large-scale projects is
their extensive project
duration; this increases
the probability of
greater difficulties
ocurring. Moreover, when
IT projects last longer,
their requirements often
change, and these
changes are too often
not documented. As
project size increases,
so does the number of
employees on it, which
makes communication
problematic. These
factors, coupled with
high time pressure, have
a negative effect on
carefully constructed
planning and a clean
project set-up.
The technological
complexity of
large-scale IT projects
is also frequently
underestimated. The
technologies used are
often new, or even first
developed during the
project, to exploit
first mover advantages.
But if these | |
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| | technologies are not yet
fully mature, then
project failure becomes
a real possibility.
The key to
success: concentrate on
the launch
So there are
certainly plenty of
risks, but at the same
time, plenty of
opportunities to
minimise them: “With
careful technical work
and launch management
that is focused on the
real goal, namely start
of production and
operations, companies
can manage the risks,”
says study author Gerard
Richter. “The danger
that a capital- and
time-intensive
large-scale project
fails is then
significantly smaller.”
Roland Berger experts
have drawn up five
guidelines for
successful launch
management:
● See launch
management as a craft:
Well-trained
employees and
integrated,
comprehensive planning
are needed from day one.
Planning should include
actual/target
comparison, effective
risk management,
resource management
distributed over several | |
|
| | months, professional
top-management reporting
and constant interface
management.
● Don’t count on
the best-case scenario:
Handling client
expectations openly and
honestly is important,
ideally beginning with
the call for bids.
● Put together
smaller project packets:
The less broad and
complex a project is,
the easier it will be to
handle. Spread large
tasks out among several
separate sub-projects.
● Use tried and
tested technologies:
If new technologies
are needed in the
project, they should be
planned and used with
caution. When in doubt,
rely on established
standards.
● Promote open
communication and clear
decision paths:
Reporting lines to the
client and to top
management must be
defined and
institutionalised. It
must be made clear who
can make decisions and
who should be involved
in the decision-making
process. | |
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