The Relationship Between IT Project Size and Failure Rates

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This presentation looks at recent research into the relationship between the size of IT projects and the chances that those projects will be successful.

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The Relationship Between IT Project Size and IT Project Failure:

The Relationship Between IT Project Size and IT Project Failure A Web Short with Roger Sessions Roger Sessions, ObjectWatch [email protected]

About Me (Roger Sessions):

About Me (Roger Sessions) Author of seven books (including Simple Architectures for Complex Enterprises.) Author of dozens of white papers on IT Risk and Optimization. Fellow of the International Association of Software Architects. Multiple patents in software and enterprise architecture. Roger Sessions, ObjectWatch [email protected]

Wisconsin’s Accountability, Consolidation, and Efficiency (ACE):

Wisconsin’s Accountability, Consolidation, and Efficiency (ACE) Convert emails to a common system Eliminate duplicate IT functionality Consolidate servers 2005-2009 $121 M Result? Roger Sessions, ObjectWatch [email protected]

Wisconsin’s Accountability, Consolidation, and Efficiency (ACE):

Wisconsin’s Accountability, Consolidation, and Efficiency (ACE) Convert emails to a common system Eliminate duplicate IT functionality Consolidate servers 2005-2009 $121 M Result? Done! Not Done! Not Done! Roger Sessions, ObjectWatch [email protected]

Wisconsin’s Accountability, Consolidation, and Efficiency (ACE):

Wisconsin’s Accountability, Consolidation, and Efficiency (ACE) Convert emails to a common system Eliminate duplicate IT functionality Consolidate servers 2005-2009 $121 M Result? Done! Not Done! Not Done! Budgeted Cost: $2.6M Actual Cost: $13.4 M Roger Sessions, ObjectWatch [email protected]

Grim Statistics:

Grim Statistics An estimated 85 percent of government IT projects are late, over budget or both. - The Pew Center on the States, “Focus on Performance”, 2010 Roger Sessions, ObjectWatch [email protected]

What is Success?:

What is Success? Scenario A Expected: 100 BF, 36 months, $10M Delivered: 25BF, 60 months, $20M Roger Sessions, ObjectWatch [email protected]

What is Success?:

What is Success? Scenario A Expected: 100 BF, 36 months, $10M Delivered: 25BF, 60 months, $20M Scenario B Expected: 100 BF, 36 months, $10M Delivered: 100 BF, 45 months, $15M Competitor: 100 BF, 60 months, $60M Roger Sessions, ObjectWatch [email protected]

What is Success?:

What is Success? Scenario A Expected: 100 BF, 36 months, $10M Delivered: 25BF, 60 months, $20M Scenario B Expected: 100 BF, 36 months, $10M Delivered: 100 BF, 45 months, $15M Competitor: 100 BF, 60 months, $60M Scenario C Expected: 100 BF, 36 months, $10M Delivered: 100 BF, 36 months, $9M Competitor: 100 BF, 12months, $2M Roger Sessions, ObjectWatch [email protected]

What is Success?:

What is Success? Scenario A Expected: 100 BF, 36 months, $10M Delivered: 25BF, 60 months, $20M Scenario B Expected: 100 BF, 36 months, $10M Delivered: 100 BF, 45 months, $15M Competitor: 100 BF, 60 months, $60M Scenario C Expected: 100 BF, 36 months, $10M Delivered: 100 BF, 36 months, $9M Competitor: 100 BF, 12months, $2M IT Project Success Criteria 1. Accurate determination of business needs. 2 . Accurate determination of optimal schedule. 3. Accurate determination of optimal cost. 4. Delivery of all of the above. Roger Sessions, ObjectWatch [email protected]

Size and Success:

Size and Success At what point does a project’s chances of success fall below 75% ? $10 Million? $50 Million? $100 Million? Roger Sessions, ObjectWatch [email protected]

Size and Success:

Size and Success At what point does a project’s chances of success fall below 75% ? $10 Million? $50 Million? $100 Million? At what point does a project’s chances of success fall below 5% ? $100 Million? $200Million? $500Million? Roger Sessions, ObjectWatch [email protected]

PowerPoint Presentation:

Chance of Success 50 25 75 Size labor cost (USD) Roger Sessions, ObjectWatch [email protected]

PowerPoint Presentation:

Chance of Success 50 25 75 Size Standish (2009 ) $1.9M 10M+ <$750K labor cost (USD) (Standish) 2009 Chaos report published by the Standish Group Roger Sessions, ObjectWatch [email protected]

PowerPoint Presentation:

Chance of Success 50 25 75 Size Standish (2009 ) $1.9M 10M+ <$750K labor cost (USD) (Standish) 2009 Chaos report published by the Standish Group effort (person months) (Sauer) The Impact of Size and Volatility on IT Project Performance by Chris Sauer, Andrew Gemino , and Blaize Horner Reich, Comms of the ACM Nov 07 Sauer <= 24PM ($360K) 750PM ($11M) 1700PM ($25M) 2400+PM ($36M) Roger Sessions, ObjectWatch [email protected]

PowerPoint Presentation:

Chance of Success 50 25 75 Size Standish (2009 ) $1.9M 10M+ <$750K labor cost (USD) (Standish) 2009 Chaos report published by the Standish Group effort (person months) (Sauer) The Impact of Size and Volatility on IT Project Performance by Chris Sauer, Andrew Gemino , and Blaize Horner Reich, Comms of the ACM Nov 07 Sauer <= 24PM ($360K) 750PM ($11M) 1700PM ($25M) 2400+PM ($36M) Roger Sessions, ObjectWatch [email protected] Success Zone

PowerPoint Presentation:

Chance of Success 50 25 75 Size Standish (2009 ) $1.9M 10M+ <$750K labor cost (USD) (Standish) 2009 Chaos report published by the Standish Group effort (person months) (Sauer) The Impact of Size and Volatility on IT Project Performance by Chris Sauer, Andrew Gemino , and Blaize Horner Reich, Comms of the ACM Nov 07 Sauer <= 24PM ($360K) 750PM ($11M) 1700PM ($25M) 2400+PM ($36M) Roger Sessions, ObjectWatch [email protected] Success Zone Danger Zone

PowerPoint Presentation:

Chance of Success 50 25 75 Size Standish (2009 ) $1.9M 10M+ <$750K labor cost (USD) (Standish) 2009 Chaos report published by the Standish Group effort (person months) (Sauer) The Impact of Size and Volatility on IT Project Performance by Chris Sauer, Andrew Gemino , and Blaize Horner Reich, Comms of the ACM Nov 07 Sauer <= 24PM ($360K) 750PM ($11M) 1700PM ($25M) 2400+PM ($36M) Roger Sessions, ObjectWatch [email protected] Success Zone Danger Zone Failure Zone

Sessions’ Law of Size:

Sessions’ Law of Size IT Projects less than $1M will probably succeed, regardless of how poorly managed they are. Roger Sessions, ObjectWatch [email protected] 8 people 6 months Success Zone

Sessions’ Law of Size:

Sessions’ Law of Size IT Projects less than $1M will probably succeed, regardless of how poorly managed they are. IT Projects between $1M and $10M can succeed, if they are very carefully managed. Roger Sessions, ObjectWatch [email protected] 8 people 6 months Success Zone Danger Zone

Sessions’ Law of Size:

Sessions’ Law of Size IT Projects less than $1M will probably succeed, regardless of how poorly managed they are. IT Projects between $1M and $10M can succeed, if they are very carefully managed. IT Projects over $10M will probably not succeed, regardless of how well managed they are. Roger Sessions, ObjectWatch [email protected] 8 people 6 months 20 people 36 months Success Zone Danger Zone Failure Zone

The Standish Perspective:

The Standish Perspective " Seventy-three percent of projects with labor cost of less than $750,000 succeed," Jim Johnson* says. "But only 3 percent of projects a with labor cost of over $10 million succeed. I would venture to say the 3 percent that succeed succeeded because they overestimated their budget, not because they were managed properly .“ * Standish Group Chairman in How to Spot a Failing Project in CIO Magazine, July 2007 Roger Sessions, ObjectWatch [email protected]

How to do Big IT:

How to do Big IT Don’t do Big IT. Do Little IT Roger Sessions, ObjectWatch [email protected]

Some Projects Are Easy to Split Up:

Some Projects Are Easy to Split Up

Maybe:

Maybe

This?:

This?

This?:

This?

Three problems with splitting up IT projects.:

Three problems with splitting up IT projects. 1. Dependencies 2. Sensitivity 3 . Timing Roger Sessions, ObjectWatch [email protected]

Dependencies:

Dependencies Roger Sessions, ObjectWatch [email protected]

Dependencies:

Dependencies Roger Sessions, ObjectWatch [email protected]

Dependencies:

Dependencies Roger Sessions, ObjectWatch [email protected]

Dependencies:

Dependencies Roger Sessions, ObjectWatch [email protected]

Dependencies:

Dependencies Roger Sessions, ObjectWatch [email protected]

Dependencies:

Dependencies Roger Sessions, ObjectWatch [email protected]

Dependencies:

Dependencies Roger Sessions, ObjectWatch [email protected]

Sensitivity:

Sensitivity Roger Sessions, ObjectWatch [email protected]

Sensitivity:

Sensitivity Roger Sessions, ObjectWatch [email protected]

Sensitivity:

Sensitivity Roger Sessions, ObjectWatch [email protected]

Sensitivity:

Sensitivity Roger Sessions, ObjectWatch [email protected]

Sensitivity:

Sensitivity Roger Sessions, ObjectWatch [email protected]

Timing:

Timing It is very difficult to gather requirements on large projects. It is very difficult to split up large projects until you know the requirements. Roger Sessions, ObjectWatch [email protected]

So How Do You Manage The Split?:

So How Do You Manage The Split? It depends…. At less than $1M, the project doesn’t need to be split. Roger Sessions, ObjectWatch [email protected]

So How Do You Manage The Split?:

So How Do You Manage The Split? It depends…. At less than $1M, the project doesn’t need to be split. Between $1-5M, the project can be split by eyeball. Roger Sessions, ObjectWatch [email protected]

So How Do You Manage The Split?:

So How Do You Manage The Split? It depends…. At less than $1M, the project doesn’t need to be split. Between $1-5M, the project can be split by eyeball. Between $5-10M, the split requires a Project O ptimization M ethodology. Roger Sessions, ObjectWatch [email protected]

So How Do You Manage The Split?:

So How Do You Manage The Split? It depends…. At less than $1M, the project doesn’t need to be split. Between $1-5M, the project can be split by eyeball. Between $5-10M, the split requires a Project O ptimization M ethodology. Over $10M, the split requires a formal pre-planning process, a dedicated team, and a Project O ptimization M ethodology. Roger Sessions, ObjectWatch [email protected]

Project Optimization Methodology (PrOM):

Project Optimization Methodology ( PrOM ) Non-Optimized Project (NOP) Roger Sessions, ObjectWatch [email protected]

Project Optimization Methodology (PrOM):

Project Optimization Methodology ( PrOM ) PrOM Non-Optimized Project (NOP) Roger Sessions, ObjectWatch [email protected]

Project Optimization Methodology (PrOM):

Project Optimization Methodology ( PrOM ) PrOM Non-Optimized Project (NOP) Highly Optimized Project (HOP) Roger Sessions, ObjectWatch [email protected]

Project Optimization Methodology (PrOM):

Project Optimization Methodology ( PrOM ) PrOM Non-Optimized Project (NOP) Highly Optimized Project (HOP) Example of PrOM : Simple Iterative Partitions (SIP) Mathematical Analytical Predictive Patented Roger Sessions, ObjectWatch [email protected]

Summary:

Summary Size Matters! In a bad way. Roger Sessions, ObjectWatch [email protected]

Summary:

Summary Size Matters! Don’t worry about how to manage large projects. In a bad way. They are unmanageable. Roger Sessions, ObjectWatch [email protected]

Summary:

Summary Size Matters! Don’t worry about how to manage large projects. Worry about how to split large projects into small projects. In a bad way. They are unmanageable. Easier said than done. Roger Sessions, ObjectWatch [email protected]

Summary:

Summary Size Matters! Don’t worry about how to manage large projects. Worry about how to split large projects into small projects. Don’t worry about how to manage small projects. In a bad way. They are unmanageable. Easier said than done. It is hard to mess them up! Roger Sessions, ObjectWatch [email protected]

Thank You!:

Thank You! To keep informed of future events, www.objectwatch.com/subscriptions Future Web Shorts: The Mathematics of Optimization Size and Agility Risk in the Cloud Simple Iterative Partitions (SIP): A Project Optimization Methodology Let’s talk! Twitter: @ RSessions ; L ink-in, Roger Sessions; E mail, [email protected] Roger Sessions, ObjectWatch [email protected]

PowerPoint Presentation:

The End Roger Sessions, ObjectWatch [email protected]

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