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Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
Breakthroughs In [It] Project Management   Slideshare
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Breakthroughs In [It] Project Management Slideshare

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introduction to new course at University of Sydney

introduction to new course at University of Sydney

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  • Investments in IT should increase from the current levels of $1,000,000,000,000 per annum (Seddon et al. 2002, Cox 2003, Ein-Dor 2003) . To unlock the fifty-fold improvements in productivity promised by the information age (Covey 2004), IT continues to represent for many organisations, their main source of opportunity (Clegg et al. 1997). Evidence suggests organisations are consistently repeating the same mistakes (Collins and Bicknell 1997). Boards are looking for guidance (Young and Jordan 2002a) and IS research clearly has a role to play. Unfortunately because IS research is lacking in relevance, especially to this wider audience, it is failing to contribute where it could add the most value. 28% of IT projects are abandoned before completion (Standish 1999) 30–40% of projects are implemented without any perceptible benefits (Willcocks 1994) 80-90% of projects fail to meet their performance objectives (Clegg & al 1997)
  • Figure of the heavenly bodies - Illuminated illustration of the Ptolemaic geocentric conception of the Universe by Portuguese cosmographer and cartographer Bartolomeu Velho . (Bibilotèque nationale de France, Paris). Notice the distances of the bodies to the centre of the Earth (left) and the times of revolution, in years (right). The Ptolemaic geocentric model of the Universe according to the Portuguese cosmographer and cartographer Bartolomeu Velho (Bibliothèque Nationale de France, Paris). Source: http://en.wikipedia.org/wiki/File:Bartolomeu_Velho_1568.jpg Challenged by Copernicus in 1543 and later by Galileo in 1610
  • 28% of IT projects are abandoned before completion (Standish 1999) 30–40% of projects are implemented without any perceptible benefits (Willcocks 1994) 80-90% of projects fail to meet their performance objectives (Clegg & al 1997)
  • Jed
  • Management of large-scale expenditures is a fiduciary duty requiring careful oversight. However a Deloitte survey of boardroom directors revealed oversight of IT projects was either “blind” (29% with inadequate information) or non-existent (16%) [i] . They warned in 2007 that the results were “tantamount to negligence” and the AICD have long reported statistics suggesting the problem is more widespread [ii ] (Figure 1). My own research suggests that as many as two out of three projects fail to deliver the expected benefits [iii ] . Increased scrutiny could reveal the real failure rate. However what might be worse in the current financial environment is to have two out of three strategic initiatives fail to increase revenue, enhance customer service or reduce cost and threaten survival. [i] What the Board Needs to Know About IT: Phase II Findings (Deloitte, 2007), http://www.deloitte.com/dtt/article/0,1002,sid=36692&cid=151800,00.html [ii] D. Lovalla and D. Kahneman, “Delusions of success: how optimism undermines executive's decisions, Harvard Business Review,” Harvard Business Review July (2003): 58 [iii] R. Young, “What is the ROI for IT Project Governance? Establishing a benchmark.,” in 2006 IT Governance International Conference (Auckland, New Zealand, 2006)
  • Management of large-scale expenditures is a fiduciary duty requiring careful oversight. However a Deloitte survey of boardroom directors revealed oversight of IT projects was either “blind” (29% with inadequate information) or non-existent (16%) [i] . They warned in 2007 that the results were “tantamount to negligence” and the AICD have long reported statistics suggesting the problem is more widespread [ii ] (Figure 1). My own research suggests that as many as two out of three projects fail to deliver the expected benefits [iii ] . Increased scrutiny could reveal the real failure rate. However what might be worse in the current financial environment is to have two out of three strategic initiatives fail to increase revenue, enhance customer service or reduce cost and threaten survival. [i] What the Board Needs to Know About IT: Phase II Findings (Deloitte, 2007), http://www.deloitte.com/dtt/article/0,1002,sid=36692&cid=151800,00.html [ii] D. Lovalla and D. Kahneman, “Delusions of success: how optimism undermines executive's decisions, Harvard Business Review,” Harvard Business Review July (2003): 58 [iii] R. Young, “What is the ROI for IT Project Governance? Establishing a benchmark.,” in 2006 IT Governance International Conference (Auckland, New Zealand, 2006)
  • Jed
  • Raymond
  • To survive, thrive and also to minimise the governance backlash, the first step must be to get the right information needed to govern effectively. The board bears the responsibility to set clear guidelines and expectations about the kinds of information they want to see filter up. What benefits are being targeted? [how is this consistent with our strategic priorities?] Do we have the organisational capacity to realise these benefits and what other risks are involved? How will we measure success? Do we have the right person driving the change? Are there any warning signs that the project is going off track? Are the benefits being realised? These questions seem simple but none of the directors I have spoken to had an effective process to terminate failing projects. Benefits are usually quantified (66%), but they are often overstated (27%) [i] , change is not always considered (40%) [ii] , individuals are not held accountable (5-23%) and few organisations track benefits through to realisation (10%) [iii] . Organisations do not focus on the true determinants of success. [i] Chad Lin, Graham Pervan, and Donald McDermid, “IS/IT investment evaluation and benefits realization issues in Australia,” Journal of Research and Practice in Information Technology 37, no. 3 (2005): 235-251 [ii] KPMG, “Global IT Project Management Survey: How committed are you?,” 2005, http://www.kpmg.com.au/Portals/0/irmprm-global-it-pm-survey2005.pdf [iii] John Thorp, “Unlocking Value - Delivering on the Promise of Information Technology,” in Delivering Value , 2008, http://www.isaca.org.au/modules.php?op=modload&name=News&file=article&sid=28
  • Transcript

    • 1. Governing portfolios of programmes to execute strategy INFO 5010: Advanced concepts in IT project management Lecture 1 – Introduction, Lecture 2 – Governance Unit coordinator: Dr Raymond Young (MBA, GAICD)
    • 2. Agenda <ul><li>Overview of course </li></ul><ul><ul><li>Why this is course needed </li></ul></ul><ul><ul><li>Welcome & introductions </li></ul></ul><ul><ul><li>Review of course outline </li></ul></ul><ul><li>AM: HB280-2006 Case Studies—How boards and senior management have governed ICT projects to succeed (or fail) </li></ul><ul><ul><li>Exposing the ICT Blindspot: Failure & Success </li></ul></ul><ul><ul><li>Explaining Top Management Support </li></ul></ul><ul><li>PM: The 6Q Governance™ Framework </li></ul>
    • 3. Why this course is needed A response to IT project failure Military & scientific computing Business Computing EDP (1950-1980), MIS (1970 - ), SIS (1980 - ) ENIAC (‘46) EDSAC (‘49) LEO (‘51) <ul><li>D.T. Caminer, “And How to Avoid Them,” The Computer Journal 1, no. 1 (1958): 11-14, </li></ul><ul><li>R.L. Ackoff, “Management Misinformation Systems,” Management Science 14, no. 4 (December 1967): 140-156. </li></ul><ul><li>H.C. Lucas, Why Information Systems Fail (New York: Columbia University Press, 1975). </li></ul><ul><li>K. Lyytinen and R. Hirschheim, “Information systems failures - a survey and classification of the empirical literature,” Oxford Surveys in Information Technology 4 (1987): 257-309. </li></ul><ul><li>C. Sauer, Why Information Systems Fail: a case study approach (Henley on Thames: Alfred Waller Ltd, 1993). </li></ul><ul><li>C. Clegg et al., “Information technology: a study of performance and the role of human and organizational factors,” Ergonomics 40, no. 9 (1997): 851-871. </li></ul><ul><li>R. Young and E. Jordan, “Top management support: Mantra or necessity?,” International Journal of Project Management 26, no. 7 (2008): 713 - 725 </li></ul>PC Internet 1 2 3 4 5 6 7 1940 1950 1960 1970 1980 1990 2000
    • 4. The reality: project success rates have not improved ROI 30% 10-20% Clegg et al 1997 30-40% Willcocks and Margetts 1994 15% Standish 2002 2/3 of projects deliver no benefits whatsoever Success (On-time On-budget) vs Process failure Success (Realise Expected Benefits) vs Correspondence failure OK Some No Fail
    • 5. The reality: project success rates have not improved ROI 30% 10-20% Clegg et al 1997 30-40% Willcocks and Margetts 1994 15% Standish 2002 2/3 of projects deliver no benefits whatsoever Success (On-time On-budget) vs Process failure Success (Realise Expected Benefits) vs Correspondence failure <ul><li>It’s no better with other types of projects </li></ul><ul><li>¾ of mergers and acquisitions never pay off </li></ul><ul><li>2/3 of IT projects deliver no benefits whatsoever </li></ul><ul><li>most large capital projects fail to live up to expectations </li></ul><ul><li>majority of efforts to enter new markets are abandoned in a few years </li></ul><ul><li>70% of new manufacturing plants are closed in their first decade </li></ul>OK Some No Fail
    • 6. <ul><li>IT project failure has been an issue almost since the dawn of business computing (Caminer 1958) . </li></ul><ul><li>It has been studied intensively for the past 40 years (Lucas 1975, Lyytinen and Hirschheim 1987) </li></ul><ul><li>but it remains a poorly understood phenomena (Sauer 1993, 1999). </li></ul><ul><li>An enormous number of largely untested methodologies have been proposed and adopted (Checkland 1981, Strassmann 1995, Clegg et al. 1997). </li></ul>Rethinking project management “ dimensions thought to be important divide tasks, requirements scrubbing, KISS, reduce scope, simulation/scenarios, prototyping, pilots, testing, user participation, user surveys, publicising participation results, team meetings, user led teams, user committees and good relationships, user managed decisions and development, user commitment, monitor progress and promote open discussion, critical task focus, project organisation, external contracts and outsourcing, formal procedures, cost allocation structures, pre-scheduling, cost and schedule estimation, incremental approach, path-analysis, risk-driven project planning, physical arrangements, staff with top talent, seek champions, cross training, morale building, manage expectations, implementation games, training, role playing, study and screen potential actors, specification standards and methods, task and organisational analysis techniques, information hiding/abstraction and modelling, bench marking, flexible governance structures, task matching, contingency models, managing technology options, adapt authority and decision structure, modify process model, technical analysis, service assessment, gain management support, appropriate leadership, change authority or workflow, adopt/configure new organisational technologies (Lyytinen, Mathiassen et al) have no consistent impact on the success of computing”(Kraemer & King 1986). The traditional wisdom must be revisited
    • 7. Welcome & Introductions Please tell us: Your name Where you are from Your work experience What you hope to gain out of this course
    • 8. Review of Course Outline
    • 9. Breakthrough #1 Exposing The ICT Blindspot
    • 10. A analogy for understanding the significance of project governance
    • 11. It depends on your definition of success MIS Success: User focus SIS Success: Organisational focus EDP Success: Technical focus Delone, W. H. and McLean, E. R. (2003) The Delone and McLean Model of Information Systems Success: a ten-year update Journal of Management Information Systems, 19:4 , 9-30. Net Benefits Information Quality System Quality Service Quality User Satisfaction Intention to use Use
    • 12. <ul><li>Standish (1996) </li></ul><ul><li>User involvement (19) </li></ul><ul><li>TMS (16) </li></ul><ul><li>Clear statement of requirements (15) </li></ul><ul><li>Proper planning (11) </li></ul><ul><li>realistic expectations (10) </li></ul><ul><li>smaller project milestones (9) </li></ul><ul><li>Competent staff (8) </li></ul><ul><li>ownership (6) </li></ul><ul><li>clear vision & objectives (3) </li></ul><ul><li>hard working, focussed staff (3) </li></ul><ul><li>Project methodologies (35) </li></ul><ul><ul><li>Clear statement of requirements (15), </li></ul></ul><ul><ul><li>Proper planning (11), </li></ul></ul><ul><ul><li>smaller project milestones (9) </li></ul></ul><ul><li>User ( 25): </li></ul><ul><ul><li>User involvement (19), </li></ul></ul><ul><ul><li>ownership (6) </li></ul></ul><ul><li>TMS (16) </li></ul><ul><li>High level planning (13): </li></ul><ul><ul><li>realistic expectations (10), </li></ul></ul><ul><ul><li>clear vision & objectives (3) </li></ul></ul><ul><li>Project staff (11): </li></ul><ul><ul><li>Competent (8), </li></ul></ul><ul><ul><li>hard working and focussed (3) </li></ul></ul>Reference: Young and Jordan (2008) “ Top Management Support: mantra or necessity ” International Journal of Project Management Vol 26, pp713-725 Re-examining the traditional wisdom Top Management Support: mantra or necessity?
    • 13. Case Studies HB280 – 2006 <ul><li>Descriptive Case Studies </li></ul><ul><ul><li>Goles and Hirschheim 2000; Tashakkori and Teddlie 2003; Benbasat and Zmud 1999 </li></ul></ul><ul><li>Multiple-case study design </li></ul><ul><ul><li>2 typical organisations, 3 exemplary organisations </li></ul></ul><ul><ul><li>Case history developed through interviews with: </li></ul></ul><ul><ul><ul><li>project sponsors, </li></ul></ul></ul><ul><ul><ul><li>top managers, </li></ul></ul></ul><ul><ul><ul><li>project team, </li></ul></ul></ul><ul><ul><ul><li>stakeholders from multiple levels </li></ul></ul></ul><ul><ul><li>Rigour through multiple sources of evidence: interviews, project documentation, observation, critical review (at 3 levels) Young and Jordan 2002a; Young and Jordan 2002b; Young 2003; Young and Jordan 2003 </li></ul></ul>
    • 14. Breakthrough #2: TMS – t he most critical success factor Reference: Young (2006) HB280 Case Studies – How Boards and Senior Management have Governed ICT Projects to Suceed (or Fail). Standards Australia
    • 15. Project Management Success Very strong emphasis in practice
    • 16. Management Perception of Project Management Kwak & Anbari (2009)
    • 17. Emerging Core Tools Project Management – 50+ years of development Crawford, Pollack, England (2006) number of success stories reported are almost twice the number of failures 62% of projects are reported to have either met most or all performance criteria
    • 18. How do you Govern Projects?
    • 19. The Global Financial Crisis? The catalyst for widespread adoption of the ‘benefits’ definition of success? Oversight blind (29%) or nil (16%) Increasing degrees of negligence Level of scrutiny (benign economy) 1:5 projects perceived to fail 2:3 projects fail New levels of scrutiny <ul><li>M anagement of large-scale expenditures is a fiduciary duty requiring careful oversight. The results were “tantamount to negligence”. Deloitte( 2007) What the Board Needs to Know About IT: Phase II Findings </li></ul><ul><li>“ A pay structure that rewards origination without regard to investment outcomes is not appropriate” Michael Larkin, CEO Babcock and Brown (AFR 11 Nov 2008, p 84) </li></ul>
    • 20. <ul><li>¾ of mergers and acquisitions never pay off </li></ul><ul><li>2/3 of IT projects deliver no benefits whatsoever </li></ul><ul><li>most large capital projects fail to live up to expectations </li></ul><ul><li>majority of efforts to enter new markets are abandoned in a few years </li></ul><ul><li>70% of new manufacturing plants are closed in their first decade </li></ul>The Global Financial Crisis? The catalyst for widespread adoption of the ‘benefits’ definition of success? Level of scrutiny (benign economy) 1:5 projects perceived to fail New levels of scrutiny <ul><li>M anagement of large-scale expenditures is a fiduciary duty requiring careful oversight. The results were “tantamount to negligence”. Deloitte( 2007) What the Board Needs to Know About IT: Phase II Findings </li></ul><ul><li>“ A pay structure that rewards origination without regard to investment outcomes is not appropriate” Michael Larkin, CEO Babcock and Brown (AFR 11 Nov 2008, p 84) </li></ul>
    • 21. Governing Projects Achieving Outcomes & Realising Benefits Strategy Defined outcomes Delivered outcomes Governance Benefits Enabling projects
    • 22. Corporate Governance, Governing Projects and Project Management Standards: OECD Guidelines ASX Guidelines AS8000 Focus on Vision and Mission and described in Corporate Plan (normally 3 years) Corporate Governance: The system by which organisations are directed and controlled Standards: PRINCE2 , MSP PMBOK, OPM3 Focus on Outputs (time, budget, quality, stakeholder support, outcomes) Project Management: The way of guiding and managing projects to ensure successful completion from start to end Standards: Gateway HB280 AS8016 www.valuedeliverymanagement.com Focus on Outcomes (Key Initiatives and business benefits) and described in Departmental Annual Plan Governing Projects: The connection between corporate governance & project management
    • 23. Governance Evaluate Direct & Monitor Investment: benefits or terminate? Strategy/capability: how much change is required? Investment & Strategy: Benefits / alignment? Responsibility: Project Sponsor? Performance & Behaviour: measures and motivation? 67%->40% 40% 5-23% 33-67% 0-13% ITIL, COBIT Projects PMBOK, PRINCE2, etc Conformance & Behaviour: culture for issues to be raised? ??% 6Q Governance™ HB280, AS8016 Business processes ICT Operations Support Changed Business Processes Changed ICT Operations Initiate
    • 24. Financial/Strategic Implications Current Performance (68% under) Source: R. Young, “What is the ROI for IT Project Governance? Establishing a benchmark.,” in 2006 IT Governance International Conference (Auckland, New Zealand, 2006) OK Some No Fail ROI 30% OK Some Fail ROI 130% Better Performance (43% under) OK Cancel ROI 220% Excellent Performance (15% cancelled)
    • 25. Questions & Discussion

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