14 Mar What major IT-projects can learn from successful start-ups
by Frans Lambi and Jan Ploeg
A lot has been written about how to tackle major IT projects, but apparently, not too much progress has been made to improve project’s success rates. Therefore we have been analysing the problems, causes and effects based on several studies including an extensive study on major IT projects in the Dutch government. This gave us the insight that a major IT project should not solely be regarded as a technical challenge but could rather be better compared to starting a new enterprise. That is why we decided to look at major IT projects from a different point of view: the entrepreneurial perspective. Consequently, we have asked ourselves what major IT projects could learn from start-ups.
We recommend the following strategies:
Regard a major IT project as starting up a new enterprise
Most major IT projects are meant to create large IT systems with lots of associated services. It is not just about technology, but also about creating value, service channels, processes, users, suppliers, stakeholders, management structures, staff, cost structures, financing, cost savings or generated revenue (when applicable). Accordingly we have made the association with starting a new enterprise. This mindset helps those in charge to focus on the added value for the ultimate users of the perceived IT-solution and makes them more aware of the overall complexity, uncertainties and associated risks which they are going to face.
Only start when the project sponsor is fully committed and passionate
A committed and passionate project sponsor typically demonstrates that the project really matters to him and that he will do everything which is needed to complete the project successfully. As we know from experience almost every major IT project is going to face difficulties. That is when the confidence, backing, and encouragement of the project sponsor are vital for the project to succeed.
Build a strong project team
Obviously a strong project team is needed. But what does this mean? Involving capable people and assigning a project manager is not enough.
A strong project team is one in which at least all professionals who are key to the project participate. Such a team typically is multidisciplinary so that it is able to cope with the challenges of major IT-projects. Additionally, it should be strongly motivated and have what we call “chemistry”. All team members should be focused, capable people who know each other fairly well both personally and professionally. They should know how to combine ambition and realism. They should appreciate each other’s strength’s and weaknesses and treat each team member with respect, personally and for their role in the project. Knowing how to cope with the ego’s of “leading lights” within the team can be vital for a good working relationship.
This type of team can only be built with the help of the project sponsor who can empower the team. Basically, the link with the project sponsor is crucial for being able to face the challenges that usually arise during major IT-projects. Therefore project sponsor and team should be on the same wavelength.
Be creative, identify multiple options and experiment
When initiating, defining and planning a major new IT-project problems may arise quite often as a result of time pressure, existing preferences for certain types of solutions biased by personal or commercial interests, wishful thinking and other types of unrealistic expectations. These influences can easily lead to jumping to conclusions and consequently to a wrong start of the perceived project.
Our solution to this would be to enable creativity, to identify multiple options and to carry out experiments. It is wise to research several options one step deeper and to use simulation, prototyping techniques, or pilots with the involvement of real end users to test several “solutions” upfront. Options which might be perceived as “out of the box” should be given a chance. In all these efforts it is vital to stay focused on creating essential added value for the perceived end users. It is like defining the minimum value proposition for (potential) customers of a start-up. Several small development teams equipped with smart tools could be involved to make this happen. This approach will help to get a much better idea about what the project’s objectives and scope should be and what deliverables and outcomes could be expected before big money is being invested.
Accept failing in an early stage and regard it as a helpful learning experience
Identifying and researching multiple options inevitably will lead to “failures”. Options which might look promising at first glance might show too many unwanted consequences and risks when evaluated by carrying out real-life experiments. Such results are very valuable because they may prevent substantial investments being made for unworkable solutions. Successful entrepreneurs know this. They don’t fear switching to plan B when their present approach does not deliver the expected results. Consequently, this type of failing should be regarded as a helpful learning experience. It may even happen that no feasible option can be found at all. In that case, the right decision would be: apparently it was not such a good idea after all, so we will not continue with this!
Involve real end users when carrying out experiments during project initiation & definition
Real end users will probably get involved at the end of the IT-project, and more in particular during testing for acceptance. In the earlier stages of development involved business experts typically think on behalf of end users. In our opinion, this has to change.
We recommend distinguishing between several categories of end users – if applicable – and involving a representative selection of these when carrying out experiments during the initiation, definition and planning phases of a project. The same happens when start-ups are defining their product-market fit. This enables to get direct feedback about essential added value for the groups who will actually use the new IT solution once it goes into operation. That feedback is vital to understand what type of IT solution should be developed and implemented.
Be transparent about issues, vulnerabilities and risks
Major IT-projects generally face many uncertainties and risks. Identification of uncertainties, issues, vulnerabilities and associated risks is needed to be able to reduce the overall project risk. Therefore we recommend that all parties are open and transparent right from the start when dealing with important issues, even if the issues are sensitive. It is about “putting the fish on the table”, according to George Kohlrieser (expert on leadership). This creates early awareness and shared understanding among all major parties involved and enables effective countermeasures to be taken.
Of course, this is not an easy exercise and requires excellent negotiation skills. However, the result can be very rewarding. It helps to avoid disasters later on when substantial money (millions of dollars) and effort have already been spent.
Commit stakeholders in an early stage to accept project’s risks
Once the project’s risks have been identified, preferably as early as possible, it makes sense to make stakeholders co-responsible in dealing with those risks. A balance has to be found between the stakeholders’ interests and the part and type of the risk which can be allocated to them. The advantage of this approach is that involved parties will be more alert and considerate when dealing with major issues such as scope creep.
Think big and start small
There is nothing wrong about thinking big. When thinking big about new IT solutions, many of us immediately think about large complex systems with many users and multi-million dollars of investment. In fact those are actually the projects we are examining here. However, you should also be thinking big about the desired outcome and the expected effects. Shouldn’t that be more important than project size? What would be better to talk about: “hey we are developing a game changer here, this will disrupt the way we offer services to our clients” compared to “wow, we are going to spend 50 million dollars to implement and roll out a state of the art ERP-system”?
Even when we know that the project probably will be big in size, we prefer to focus on thinking big in project outcome while keeping the desired IT solution as small as possible. Therefore we recommend to start small and to focus on the essence, the added value for (key) users. Once the project is on its way it becomes a matter of staying agile, learning fast and keeping the project scope under control while weighing the created added value against the size and associated costs of the desired IT solution.
Frans Lambi is Managing Director of Covision Management Consulting and mentor at HighTechXL (accelerator for high-tech start-ups) in The Netherlands
Jan Ploeg is Information Manager & Architect and member of the Dutch governmental pool of IT-professionals
[Readers who are proficient in reading Dutch can download our white paper by visiting the following url: http://ibestuur.nl/podium/behandel-het-ict-project-als-een-startup]