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Why IT Projects Run Off the Rails
Why do IT projects run off the rails, overshoot time and cost plans, or fail outright? The Economist looked into exactly that question.
The good news first: most IT projects stay within the agreed budget, and only about a fifth exceed planned costs by more than half. The bad news: among the troubled projects, the average overrun runs into several hundred percent.
Three reasons stand out.
Too much optimism. At the start, many participants approach the work with an outlook that is too positive and overlook the pitfalls. Timelines and budgets rest on wishful thinking rather than realistic assessments.
Missing standards and benchmarks. Unlike classical engineering disciplines, software development rarely has established guidelines or reliable reference values. Without them, complexity is hard to judge realistically.
Scope creep. Small adjustments to project scope in particular turn out to be explosive for schedule and budget. Unclear ownership makes it worse.
From ten years of corporate steering projects, I would set three things against this: a clearly agreed value proposition before the work starts, so everyone involved has the same goal in view. An iterative approach that can absorb new findings instead of treating them as disruption. And open communication about progress and problems, because change management does not begin at the end but at the start.
None of these points is new. That is precisely what is remarkable.