IT projects foundering in legal quagmire

The research found increased emphasis on liability is delaying almost all project negotiations, and over 80 per cent of suppliers are being asked to share more risk with their customers.

According to Rosemary Mulley, Nabarro lawyer and former IT director, sharing risk is the perennial problem. "IT projects are inherently difficult to manage and quite high risk," she said. "Modern service contracts are an attempt to find a balance between supplier and customer."

The CSSA survey found most of the 250 IT suppliers it surveyed wanted to improve their contract processes.

"Suppliers would like to improve the way they analyse and reduce risk," said Mulley, "but at the moment they're not bringing in legal advisors until right at the end of the process."

Tim Conway, director of industry affairs at the CSSA, said many ecommerce projects cut corners because of the time pressure. "Risk is something that has to be taken by those that are best able to bear it," he said. "There are going to be areas of every project that create risks nobody wants to take - and there have to be processes for managing that."

Despite the survey's findings, Conway added that suppliers shouldn't be tempted into hiring too many advisors. "There's no way turning up to a meeting with five lawyers and five risk analysts is going to make life easier for anyone," he said.