A recent article in the Harvard Business Review highlighted some alarming statistics on project failures. IT projects were overrunning their budgets by an average of 27%, but the real shocker was that one in six of these projects was over by 200% on average. They dubbed these epic failures the “black swans” of the project portfolio.
The article ends with some excellent advice on avoiding the black swan phenomenon, but the recommendations focus on two areas:
- Assessments of the ability of the business to take a big hit
- Sound project management practices such as breaking big projects down into smaller chunks, developing contingency plans, and embracing reference class forecasting.
We would like to add to this list a set of “big project readiness” tasks that offer additional prevention of your next big IT project becoming a black swan.
Project Management Readiness: If you don’t have seasoned PMs with successful big project experience on your team, you need to fill that staffing gap either permanently or with contract help for the big project. Yes, you need an internal PM even if the software vendor has their own PM.
Data Readiness: Address your data quality issues now, and establish data ownership and data governance before you undertake the big project.
Process/organization/change management readiness: Are your current business processes well documented? Is the process scope of the big project defined correctly? Are process owners clearly identified? Do you have the skills and framework for defining how the software may change your business processes, organization structure and headcounts? If not, you run a significant risk of failing to achieve anticipated ROI for this project. Do you have a robust corporate communication framework? Do you have the resources, skills and experience to develop and run training programs in house?
Let’s face it: experience matters. If you’re already struggling to recover from a technology black swan, you are at considerable risk for reproducing the same level of failure if you don’t undertake a radical overhaul of your approach by identifying and addressing every significant weakness in the areas noted above.