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About 47 percent of all IT projects are nixed

May 23, 2008

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According to a survey conducted by the Information Systems Audit Control Association, about 47 percent of all IT projects get cancelled even before they’re even completed.

The survey was jointly conducted with ISACA, an international organization with more than 75,000 members in 160 countries. Mario Damianides, a past international president of ISACA and the IT Governance Institute, said he was surprised that 43.3 per cent of those surveyed admitted nixing an IT project prior to full implementation. “I didn't expect the numbers to be so high,” he said.

At the lower end of the scale, 14.4 per cent said IT projects had ended because they were no longer a priority for their organization, while budget constraints ranked at a mere 13.2 per cent. Only 6.6 percent said they had ended an IT project because it did not support the business strategy.

About 30 percent of those surveyed said they had cancelled an IT project because business needs had changed. Close to 24.2 percent said the project was not delivering results as expected. Damianides took this as a sign of maturation in the process of approving projects.

“The heartening thing is the fact that there is some governance in place,” said Damianides, who is also an executive with Ernst & Young. “People are saying, ‘Hold on a second, maybe we’re not getting what we should. It’s all good, because there are good decisions and good criteria for making them.”

Andrew Hughes, principal of Sierra Systems Consultants in Victoria, B.C. and a vice-president of the local ISACA chapter, said the survey findings are a good reflection of where things tend to go wrong at the project delivery level.

“What these statistics mean is that there is some alignment up front, meaning the decision-making process works fairly well,” Damianides said. “The learnings from the statistics are that there should be a more robust scorecard built ahead of time. You have to have goals that are immediate or project-focused, that allow you to make decisions on whether to stop the project or go ahead with it.”

ISACA conducted the survey by email and based the results on 386 responses.

“You have to be focused on discovering what the actual requirements are, as opposed to whatever the initial statements are and then doing the change management,” he said. “Most organizations find it very difficult to express requirements in a way that can be delivered. Part of the project management exercise is to get that change scoped in.”

ISACA and the IT Governance Institute often suggest managing projects by using governance frameworks such as Control Objectives for Business and Information Technology, or COBIT.

“You don’t need to cancel the project if it’s not going to deliver what you thought it was going to deliver,” he added. “The issue is, do you change it, modify it, invest more in it?” There you go.

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Source: ISACA.