4 Tips for Avoiding IT Project Waste

Management often bemoans the fact that IT projects fail to be delivered on time and within budget. And the truth is, the IT spending waste that occurs in our industry is at times mind-boggling. My firm has four clients — ranging in size from $7 million to $650 million in sales — all struggling with the same schedule and budget problems as they attempt to implement new order management and warehouse management systems. Another client invested $350,000 with one of the industry’s leading order management system companies. But after a failed implementation, the client backed off the project.

What’s at the root of this waste? It’s the lack of project management on both the client and vendor sides. Here are four tips based on the lessons we’ve learned to help you avoid the same fate with your IT implementations.

1. Start with the deal. Some projects should simply never be. Usually it begins when management accepts the vendor’s selling proposal, which turns out to be flawed. Take the case of one of our largest clients: It’s been struggling for two years to work with a vendor, basically to rewrite much of the vendor’s system. The client is determined because there’s a huge potential return on investment. But while it will be a big deal for the vendor when finished, it’s taking that vendor off its commercial systems path. The client should have looked at the proposal more realistically at the start.

2. Have a plan. Vendor proposals are full of boilerplates — simple task schedules and bar graphs. The real plans for a complex systems implementation require all details to be thought out, agreed upon and then scheduled. A mistake many companies make is not updating the plan weekly; they may use it to get started, but then don’t update it often enough. Also, plans often don’t take dependencies into account. Everybody involved continually is surprised because the major subtasks aren’t in sync with each other.