Studies consistently show that 80–90 percent of all software and 30–45 percent of all systems projects fail. Moreover, over half of all systems projects overrun their budgets and schedules by up to 200 percent or more. Of the projects that fail, approximately half of all those that are restarted fail again. Yet management tools and techniques, as well as software development techniques, are constantly improving. What are the causes of these expensive and seemingly uncontrollable failures?
One explanation for these high failure rates lies in the definition of failure. To a developer or an engineer, a project may be successful if the deliverables are provided to the customer regardless of schedule or budget considerations. Senior management may consider the same project a failure if it does not turn a profit, even if it is completed on time and budget. But that is splitting hairs. Project success or failure is not a matter of semantics. A project is a success only if it delivers the product or service on time, on budget, to the customer's prescribed requirements, and if its financial returns, positive or negative, are consistent with the company's strategic plan. Generally, projects succeed or fail according to how robust and viable the project management process is at the performing organization.
Computerworld, a leading systems magazine, published the results of several surveys regarding project management process deficiencies. Their results show what was missing at the surveyed companies where project failure was a major problem. The most significant problems revealed a lack of:
A project office or a clearly defined project organization (42 percent)
Integrated methods (41 percent)
Training and mentoring (38 percent)
Policies and procedures (35 percent)
Implementation plans (23 percent)
Executive support (22 percent)
The elements of a project management process and basic project management tools are essentially the same whether the project is in the information technology (IT) environment, construction environment, or some other engineering project environment. And therein lies the problem; the processes and tools are essentially the same, but the projects are not. Too many organizations and project managers still attempt to manage IT projects as if they were engineering or construction projects. To successfully manage IT projects, the management approach must be updated to reflect the current business environment, and the management processes and tools must be adapted to account for the specific characteristics of the IT environment.