This document discusses IT project management failures, classic mistakes, and best practices based on research analyzing 99 IT project retrospectives. Some key points: - McDonald's $1 billion "Innovate" project in 2001, their most expensive IT project, failed before launch due to issues like unrealistic scope and lack of senior management buy-in. - Common classic mistakes fall into four categories: people, process, product, and technology. Process and people mistakes were most frequent. - Best practices to avoid failures include thorough planning, risk management, quality assurance, and using accurate estimating techniques like historical data. Proper stakeholder engagement and having the right project sponsor are also important.

1. IT PROJECT MANAGEMENT:
INFAMOUS FAILURES, CLASSIC MISTAKES, AND BEST PRACTICES
Mahyar Teymournezhad
R. Ryan Nelson - University of Virginia

2. MANY ORGANIZATIONS
CONDUCT RETROSPECTIVES
AFTER A FAILURE TO AVOID
FUTURE DISASTERS.
An individual retrospective tells a unique story, but more
insight can be gained by examining multiple retrospectives.
99 retrospectives across 74 organizations were used to conduct
this research. From this research many common mistakes and
best practices can be extracted for better project management.

3. INFAMOUS FAILURES
MCDONALDS
This project aimed to create a real-time global
network to link over 30,000 stores in 121
countries to headquarters by Intranet. It would
have given executives a bird’s eye view of the
entire system at any minute of the day.
“INNOVATE” PROJECT (2001)

4. INFAMOUS FAILURES
MCDONALDS
At cost estimates of over $1 billion, Innovate
was the most expensive information technology
project in McDonalds’s history. Innovate project
failed before it even got off the ground.
McDonalds wrote off $170 million in the 2002
and Innovate was cancelled.
AN EPIC ‘MC-FAILURE’

5. INFAMOUS FAILURES
MCDONALDS
Scope Management: $1 billion would have
only covered the first 5 years of design and
implementation. Millions more would need to
be spent to maintaining the system.
Linking all 30,000+ locations via broadband
was impossible
WHY INNOVATE FAILED?

6. INFAMOUS FAILURES
MCDONALDS
Implementation: Attempted to go company wide in
a one fell swoop or big bang approach.
Acceptance: Franchisees reluctant to accept after
“Made For You” system in 1998 slowed service.
Senior executives also had a lack of IT knowledge.
Experience: No prior experience in large scale
software implementation.
WHY INNOVATE FAILED?

7. INFAMOUS FAILURES
MCDONALDS
• Project should have been broken down into
manageable chunks.
• Hired a project manager with large-scale
software implementation expertise.
• Eased concerns and discomfort of Senior
Management and Franchisees.
TAKEAWAYS

8. Classic
Mistakes

9. • “Ineffective project management practices that
were identified so often, by so many people,
with such predictable, negative results that they
deserve to be called “classic mistakes.”
-Steve McConell
Failure is generally rooted in errors by project
mangers and is rarely attributed to chance.
Definition
CLASSIC MISTAKES
DEFINED

10. People
IT Human Capital
Process
Management Processes and Technical
Methodologies
Product
Product Size and Product Characteristics
Technology
Use and Misuse of Modern Technology
CLASSIC MISTAKES
4 Categories of Mistakes

11. People
• Undermined Motivation
• Capabilities of the individual team members/ the
working relationship among the team members
• Leaders failure to take action to deal with a
problem employee
• Adding people to a late project

12. Process
• Wasted time in the “Fuzzy Front End”
• Underestimating and producing overly optimistic
schedules
• Insufficient Risk Management
• Contract Failure

13. Product
• Requirements Gold-Plating
• Feature Creep
• Developer Gold-Plating
• Research Oriented Development

14. Technology
• Silver-bullet syndrome
• Overestimated savings from new tools or methods
• Switching tools in the middle of a project

15. A Meta-Retrospective of 99 IT Projects
• 502 Masters level Mgmt Info Systems students were assigned to complete
retrospectives on completed IT projects of various magnitude.
• The IT projects were assessed under the following criteria:
1. Project Context and Description
2. Project Timeline
3. Lessons Learned (What Went Right vs. What Went Wrong)
4. Recommendations for the Future
5. Evaluation of Success/Failure
Overview

16. A Meta-Retrospective of 99 IT Projects
1. The majority of the classic mistakes were categorized as either
process or people mistakes.
2. Scope Creep did not make the top ten list.
3. The Top 3 Mistakes occurred in about 50% of all the projects
examined.
Case Findings

17. Summary
Project mangers should closely examine past mistakes
to determine which are the most common and search
for patterns that will help them avoid repeating these
mistakes.

18. BEST
PRACTICES

19. • One of the best advantages of uncovering what
went wrong in projects studied is to discover
what went right.
• Properly used methods, tools, and techniques
can help organizations avoid the classic
mistakes from occurring in the first place.
WIN WITHIN DEFEAT

20. • The Estimation and Scheduling Process
consists of:
• Sizing or scoping the project
• Estimating the Effort and Time Required
• Developing a Calendar
How to Avoid Poor Estimating
and/or Scheduling

21. 1.Fewer Mistakes
2.Better Budgeting
3.Less Overtime
4.More Credibility for the Project Team
5.Less Schedule Pressure
6.Less Staff Turnover
Accurate Estimates Will Include

22. The IT field is betting somewhat better at
estimating cost but worse at estimating time.
In 1994, the average cost overrun was 180%. The
average dropped to 43% by 2003.
In 2000, average time overruns reached a low of
63% but have increased significantly to 82%.
The Current Pattern
Standish Group’s longitudinal findings show that:

23. • Using Developer-Based Estimates
• A modified Delphi Approach
• Historical Data
• Algorithms
• Estimation Software
• Estimate-Convergence Graphs
How To Improve Estimating and
Scheduling?

24. 1. Time Box Development
2. Creating a Work Break Down Structure
3. Retrospectives to Capture Actual Size, Effort,
and Time
4. A Project Management Office
4 Valuable Approaches to
Improving Project Estimation and
Scheduling

25. Cone of uncertainty

26. 1. Using a Stakeholder worksheets and
assessment graphs
2. Communication Plans
3. Creation of a Project Management Office
4. Portfolio Management
INEFFECTIVE STAKEHOLDER
MANAGEMENT IS THE 2ND LARGEST
CAUSE OF PROJECT FAILURE

27. “WITH GREATER POWER
COMES
GREATER RESPONSIBILITY”
How to Avoid
Insufficient Risk Management

28. • Risk Identification
• Analysis
• Prioritization
• Risk-Management
• Planning
• Resolution
• Monitoring
The Process of
Risk Management

29. Use a Risk Table
Best Practice For Avoiding Risk

30. • Comprehensive Project Charter
• Clearly Defined Project Governance
• Portfolio Management
How to Avoid Insufficient Planning

31. • Agile Development
• Joint Application Design Sessions
• Automated Testing Tools
• Daily Build-and Smoke Tests
How to Avoid Short changing
Quality Assurance

32. “One of the key problems during the development phase
of the project was the relatively low skill level of the
programmers assigned to the project. The weak
programming skills caused schedule lapses, poor quality,
and eventually caused changes in personnel.”
Get The Right Person For the Job
Reoccurring and Common Issues
Reduction in face-to-face meetings
Time-Zone Barriers
Language and Cultural Issues

33. WHO’S PAYING FOR THIS?
• A project must have the “Right” Sponsor. That means that a
project must have a sponsor who will be with the project from
the beginning, and managing the relationship throughout the life
of the project.
BUT SOME CHANGE CAN BE BETTER
• “There were CEOs on calls all the time. Nobody wanted to be
written up in the ‘Wall Street Journal.’That was what motivated
people to change. Fear that the stock price would get hammered
and fear that they would lose too much business.”

34. The End
Mahyar Teymournezhad