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IT projects don’t fail because of bad tech but due to poor decision-making processes

Decision-making advisor Giorgia Prestento is tired of reading about IT project disasters, and has a new approach to offer

The world spends a lot on information technology—in fact, according to the latest forecast by analysts Gartner, the projected worldwide IT spend is  $4.5 trillion this year alone.

The problem is that too many executives realise all that investment doesn’t really give them the expected ROI. Even worse: far too many projects seem to end up classed as failure, attracting negative publicity and even going into dark IT legend as ‘not how to do it’.

Though every IT project can go wrong, it seems to be a particular risk for large projects, where those over $15 million are claimed to typically run 45% over budget and 7% over schedule–while delivering 56% less value than predicted.

What’s going wrong here—and why so consistently? The naïve (and in fact, insulting) ‘theory’ is that it’s all down to ‘evil’ IT vendors, who keep pressing over-hyped products on long-suffering customers. This is not convincing.

This brings us to the real problem. IT projects—like every business project or initiative—are always based on decisions. IT product selection is itself a decision, so IT professionals can’t blame IT vendors for their choices.

Optimising decision-making

Such decisions—whether by groups or individuals—don’t just drop out the sky. They happen in meetings and in departments, which means they are made by people.

And that’s the nub. If you’re not careful, even the smartest people round a table can end up making decisions in non-optimal ways.  We need to look more carefully at how those groups work and we need to introduce a process and conscious structure to help people improve decision-making–and, very importantly, reviewing and rethinking those decisions.

While accepting we can’t control the outcome of a decision, we would then have more control of the process and better manage the dynamics of the teams contributing to or making decisions.

The CIO can lead the way and radically improve the whole series of events to optimise IT decisions. To see how, let’s consider the key IT decisioning issues:

 

The temptation to have all the bells and whistles

So many times, a Mercedes is specced out when a Kia could do the job just as well. IT people want to have the latest technology, and like the idea of testing out interesting new ideas; at the same time, the industry is always trying to up-sell and suggest great add-ons that might not be needed and can add to the IT complexity.

 

Forgetting your heritage

Almost all organisations have lots of existing investment and systems already—some of them old legacy systems–so you’re never buying in a vacuum. When you introduce a new element, you can’t just switch all the old stuff off—there will be some databases and other systems that the new kit will need to interface with. Problems often arise when this isn’t properly assessed, and it’s only when you start the implementation, the headache of how they’re going to fit together crops up.

 

Who’s the customer?

Like it or not, far too often the choice of an IT system is not consistent with the organisation’s overall business direction and strategy. The benefits are not aligned with the strategic goals, and the IT system is designed without considering the real needs and actual workflows of the users.

Beyond these IT decisioning issues, we also need to consider important people and behavioural change influences. These more hidden people-related factors will often come into play with IT decision-making, let’s outline a few of them below:

Not everyone’s a meeting ninja

IT leaders tend to be promoted for their technical expertise more than their wider leadership/management (‘soft’) skills. That means they can sometimes focus on how a system would work perfectly in isolation, rather than how it will ‘land’ in the company.

First in… but never first out?

A simple truth about us humans is that it’s so, so easy to go with the first option, agree things very quickly, and then assume that’s the best choice and everyone is on board. The problem of premature consensus can mask significant disagreement, and other options can get side-lined too early. At that point, it’s hard to go back to the step of considering alternative options.

There are other behavioural influences at play. One of the most frequent is confirmation bias, where people seek and agree more easily with information that confirms our beliefs. We also tend to increasingly commit to a course of action, even if we see negative initial results.

The good news is that if we had a more formal way of considering IT decision-making all the way through from business case to vendor or tech selection, all these issues could either be avoided or made so explicit they will get resolved–or at least, their inherent risks assessed.

My change management experience in major IT transformation leads me to always recommend these five steps:

1. Define what success looks like

Always work backwards! What is the outcome you want to achieve? What are the benefits we want to see? Have you considered key stakeholder views and the impact on end users?

2. Don’t drown in the numbers

You need inputs to arrive at the best possible decision, but not all data is created equal. Decide what data will build the strongest foundation for the decision, and ensure it’s from robust sources, validated by subject matter experts. Also, don’t be frightened to challenge the consensus if you’re not fully confident on the quality of all the inputs.

3. Let a thousand flowers bloom

At this stage, you want to encourage creativity and diversity of views. Technology is an enabler to solve business issues, improve profitability and reduce costs. That’s why we need to be creative in our thinking.  Diversity of thinking here is your ultimate friend. The more technology options you consider, the more likely you are to find the best solution to achieve your business goals.

4. A clear agenda

A properly structured and managed meeting is very important, and attendees always need to be clear about their role in the discussion and decision. The most useful role is the facilitator: a neutral person with no stake into the decision. Ideally, the facilitator is external to the organisation and with expertise in managing group dynamics.  It is also important meetings should be monitored and recorded, so there’s a clear audit trail of the options considered and decisions made.

5. Now press ‘Go’

If all these steps have been followed, the most relevant inputs have been considered, all opposing views or considerations raised and dealt with, you have the confidence that you’ve followed a solid process, leading to the best decision for your IT investment.

 

And it’s only when you have followed all these steps and put some science into how decisions get made in your business that you can start the project, and start reaping the commercial benefits of your new, smarter way of working.

 

About the author

CEO, Optimal Decisions, Giorgia Prestento is a decision-making advisor, change management expert and behavioural scientist.