Close to 60% of projects are based on half-baked ideas promulgated by senior business executives, according to research my firm conducted in 2003 and 2004. Yet IT professionals are seldom empowered to say "No" to senior executives -- no matter how dysfunctional their ideas may be.
Here's a real-world example from our client work at the Center for Project Management. A $1.7 billion insurance company's vice president of sales felt he had a great idea for differentiating the company from its competition. Convinced he knew "exactly what the customers wanted," he directed the CIO to create a new system. He didn't bother to discuss the idea with his own salespeople for fear the competition would get wind of it. The deployment failed.
So how do you keep this from happening to you? One effective strategy is to counter with these seven business questions before taking on any project:
- Is this project aligned with a specific company strategy? Asking this question forces the individual to think through the real need for the proposed project.
- What is the project's value to the business? It's imperative that the business minds responsible for the project define and defend its value. Invariably, this responsibility falls onto the desk of IT, where justifications are invented and bad projects gain momentum.
- Have the measures of success been quantified? I often see projects where such measures haven't been defined, let alone quantified. It's not uncommon to hear "improve customer service" as a measure of success. Yet to be of any real value, specific metrics are necessary. For example: "By June 30, we need to improve customer service by 23 points, at an investment of no more than $5 million."
- How realistic are the key assumptions? Assumptions must hold true. Those accepted simply to please the customer will falter. Give each assumption a reality test, such as: "The sales manager will assign three senior full-time salespeople, beginning Nov. 12 for a period of two months, to define the user requirements." They will then validate the key assumptions or add new ones.
- Is the deadline achievable? Whether dictated by an overzealous customer or IT's "estimate-to-please" behavior, unrealistic deadlines are a major factor in most failed projects. Build in enough time for all steps of the process, from requirements gathering to testing and training.
- What are the shutdown conditions? Our research shows that some 70% of projects-in-progress don't have their shutdown conditions defined. Far too many projects are canceled long after millions of dollars are wasted. Define the conditions up front under which a project should be killed.
- What are the implications of doing nothing? Often considered taboo, this question is worth asking because it requires the customer to justify the value of the proposed project in a succinct manner.
Most failed projects would never have been approved had these seven questions been asked and answered. As a CIO, you must direct your project managers to push for answers up front.
Gopal Kapur is president of the Center for Project Management in San Ramon, Calif. Write to him at ProjectExpert@ciodecisions.com. This column originally appeared in the March 2005 edition of CIO Decisions magazine.