Consultancy points to its own research to justify IT outsourcing

IT rejects high project failure rates

Business executives and board members accept failed IT projects as "the norm" labelling them a "necessary evil" according to new research released yesterday by Tata Consultancy Services (TCS).

The report claims one in three IT projects fail to perform against expectations, a figure that has emerged in other reports that have been released in recent years.

ARD Consulting IT manager, Eric Biggsley, said the "one in three" failure rate figure is generally used to blame IT for the company's problems.

"I cannot believe consultants are still peddling these reports of high project failure rates," Biggsley said.

"Im not saying IT doesn't fail, we do; but it is never as simplistic as these reports imply.

"It takes two to tango, business and IT."

Biggsley said it isn't the first time a service provider has taken a swipe at IT to push their own agenda.

Describing it as the "divide and conquer" routine, he said the goal is to get business executives on side by creating a division between IT and business.

However, TCS wasn't specifically highlighting the project failure rate but the fact that the board was so accepting and the research didn't evoke a sharp reaction from management.

This attitude was particularly common in the Asia Pacific (48 per cent) and Europe (44 per cent). A sample of 800 interviews were collected for the research with middle and senior IT managers in large companies across eight countries. All respondents confirmed prior to interview that they were involved in driving IT projects to completion and that their company has more than 250 employees worldwide.

In fact, 69 per cent of respondents said that their managers and the board continued to provide the necessary financial support for these projects, although they were not meeting expectations.

Common problems cited included overrun on time (62 per cent), budget (49 per cent) and higher than expected maintenance costs (47 per cent).

In addition, one in four companies cited user resistance claiming they were reluctant to adopt the new systems once implemented.

TCS is using the report to urge businesses to re-think their IT services and outsourcing strategies pointing out that organisations need to work with partners that can explain the value of their work at a board level and provide Key Performance Indicators for investments.

TCS executive director, N. Chandrasekaran, said what businesses should look for is the ability to provide the right services at the right cost in the right timeframe.

He said financial credibility and global reach are also important in today's world economy.

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