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Turning Failure Inside Out

Turning Failure Inside Out

The risks of technology implementation and the imperfect nature of IT development practices make project abandonment inevitable - CIOs must learn how to handle the crisis

. . . If you can meet with Triumph and Disaster

And treat those two impostors just the same . . .

The risks of technology implementation and the imperfect nature of IT development practices make project abandonment inevitable - CIOs must learn how to handle the crisis. The authors say they can provide some recipes for success, after surveying seasoned consultants with considerable post-cancellation management experience. The results are a list of recommendations they say will tangibly assist CIOs in surviving the aftermath of project failure (listed at the end of this story).

To deal effectively with IT project cancellations, Iacovou says, organizations must ensure their operations and other systems are unaffected, their reputation and those of their employees are protected from unjustified attacks and scapegoating attempts, and that they make appropriate changes that reflect lessons learned from the experience. Failure to address properly any one of the three can cause significant financial or reputational damage.

First though, Iacovou advises, CIOs should realize the crucial role expectation plays in determining whether they will be the fall guy when things go wrong. The CIO who has been able to get his or her partners, including the business users and the CEO, to understand that IT projects are inherently risky, will find those partners have far more tolerance for cancellations and project abandonment.

So the wise CIO gives those partners a risk indicator at the very beginning of every project, which weighs the potential value of a successful implementation against the likelihood of the project ending in failure. "That risk indicator will change," Iacovou says. "It might get worse as you go forward and you discover difficulties that you haven't thought of in advance. Or you might discover that actually it turns out to be an easier problem than you originally anticipated."

Even if you manage to prime your partners to anticipate failure, you are still likely to find responding to any failure a complex and difficult undertaking. Senior executives focused on public relations and damage control and afraid of throwing good money after bad may limit the resources available to the response team. And even if they do not limit resources, that team might lack the needed organizational skills and knowledge.

CIOs who have built credibility will find it far easier to get access to needed resources, Iacovou points out. "If you're a CIO and you screw up on your first project, chances are you are not going to be as effective in securing resources to turn around the situation compared to a CIO that has had a long, successful history of running projects and runs into a problem. It's just got to be much more difficult to deal with if you don't have that source of credibility."

However, Iacovou says all is not lost even if you are the "new kid on the block". CIOs who need more resources but do not have a track record of performance to back their claims should considering aligning themselves with another business executive who does have that credibility, and can get those resources. Gaining political support from other powerful executives, whether the business sponsor who still believes in the project and agrees with your assessment as a CIO that the factors which have contributed to its demise can be eliminated, or the CEO who is willing to give it another chance because he believes in the intrinsic value of the project and recognizes that technology development is risky, can be a potent way to get the resources you need.

Look for allies among the high intensity users of technology like financial services and software development - users that understand IT development and so are more inclined to support turnaround efforts, Iacovou advises. Or if you must deal with environments that tend to be more cynical about technology, expect to do plenty of groundwork, and maybe even some arm-twisting, to get your way.

But whatever credibility you may have built up, Iacovou notes you will still need special skills quite different from ordinary IT development expertise to cope. When projects get into trouble, CIOs must show leadership, recognizing that people will only follow them if they feel the CIO is taking actions to rectify what has gone wrong.

"If I was to use only one sentence to describe those skills I would say they need crisis management skills," Iacovou says. "That means a number of things: being a good communicator at the moment of crisis is quite different from being a good communicator in a very comfortable environment where everybody is willing to listen to you as opposed to looking for people to blame. So crisis management involves a number of things, one of which means having effective communication skills."

The first thing you should communicate - as part of the "cleansing process" - is your understanding of the factors that contributed to the failure. "Not only do you have to explain why it failed but you also have to get rid of the forces that contributed to the failure," Iacovou says. "It could be a bad vendor, it could be bad technology or it could be a bad employee. It could be about a process that is in place: a bad development methodology. Whatever contributed to it, it's very important to isolate and then remove it."

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