Failed IT projects costing firms £13m a year

UK firms are each wasting £13m a year by not ditching failing IT projects, according to new research presented at the IT Directors' Forum last week.

The survey of 300 IT and business managers found four per cent of failing projects are continued when they should be scrapped. This equates to £13.4m a year for the average large UK business with 159 projects on the go, according to Microsoft, which commissioned the research.

The main excuses for cost overruns were changes to plans, a poor brief and a lack of resources.

In a separate workshop on board the cruise liner Aurora about the failings of big projects, management consultant John Thorp from the Thorp Network said businesses are still not taking into account the resources and effort needed for the associated process change and staff training.

"All you get from a technology project is capability," he said. "If we don't train people how to use the information, it is of no value to anyone except the storage vendors."

He cited Standish Group figures claiming three-quarters of big IT projects are classed as failures and said CIOs and IT directors have to be brave enough to say no at the outset if the numbers don't stack up and there isn't the commitment from the rest of the business.

"If the business isn't prepared to make these changes you shouldn't spend the money on the technology," he said.

One common reason for failed projects is staff's fear of telling a CEO when a project he has backed is going off the rails - leading to millions of pounds being wasted.

"Throwing good money after bad is not a good strategy," said Thorp.