Critical success factors for technology implementation

Up to 71 per cent of technology projects fail to fully meet their intended objectives. This particular analysis comes from the 2015 Chaos Report released by the Standish Group, which analyses 50,000 technology projects from around the world on an annual basis. It found that only 29 per cent of projects were successful, with 52 per cent categorised as challenged and 19 per cent as failed.

The report defines a successful project as one that is completed on time and on budget, with all features and functions as originally specified. In a similar report focusing on Enterprise Resource Planning (ERP) implementations, research firm Gartner found that 55-75 per cent of ERP projects fail to meet their objectives.

This is nothing new, as similar statistics have plagued the industry dating back to the $170 million botched FBI Virtual Case File system implementation in 2005 to the more recent highly publicised error prone Healthcare.gov project in 2013 with some estimates putting cost overruns at over 10 times the original budget.

Closer to home in the East Africa region, there has also been numerous failed technology projects which have either completed significantly over schedule, budget, or failed in functionality all together. These include enterprise applications and infrastructure projects in the Financial Services Industry (FSI), Public Sector, and development space to name a few.

In several key industries in Tanzania today, technology has earned a seat at the corporate executive table as a major area for capital investment, bringing the region closer to counterparts in the developed world where technology expenditure can average between 2 per cent and 5 per cent of revenue in an organisation. Gartner forecasts worldwide IT expenditure will reach $3.5 trillion in 2016, up 0.6 percent from 2015, with markets in Europe, Middle East & Africa (EMEA) playing a key role. From ERP implementations aimed at automating and integrating organisational Business Processes, Analytics solutions to help leverage Big Data, to innovative mobile solutions that have helped break barriers of traditional brick and mortar banks, the power and success of technology in our region is real and it is here to stay.

However, the consequences for failed technology projects can be significant for organisations, ranging from considerable budget and schedule overruns, regulatory non-compliance, loss of competitive advantage, and operational losses, all of which have a negative effect on the organisational bottom line. Fortunately there is good news – failure can be avoided with the right approach. The remainder of this article discusses 3 critical success factors towards effective technology adoption in an organisation.

Senior management commitment – Leadership is key

Prior to embarking on any kind of technology project or transformation within an organisation, it is critical to ensure that the project has Senior Management Commitment. A technology project will not succeed without this very critical factor. In a global CIO survey conducted by the Standish group, the number one reason reported for strategic projects failing to meet their mandate was senior management not sufficiently involved.

A holistic view

The reason for this can be best understood by looking at technology projects holistically and examining the 3 main components – People, Process and Technology. Technology solutions typically bring varying degrees of change to these 3 areas. The project will need to heavily leverage the People of the organisation as part of implementation of the project. The Business Processes may need to change to align to best practice as they become automated by the technology. Finally, the technology will either be updated, or introduced to a new environment. More often than not, the Technology has the least challenges, as it simply does what it is directed to. Furthermore, most solutions these days are purchased Commercially-Off-The-Shelf (COTS) and then customised, meaning they have developed a level of robustness over the years of being utilised, maintained and updated. The People and Process on the other hand are where the most effort and management is required. Technology projects are heavily dependent on Business Stakeholders as part of the system development lifecycle, including mapping out Business Process, identifying system requirements, and conducting detailed design and development. In order to gain the commitment of these future users and process owners to work with the project team as it redefines the way they work, possibly even restructure the organisation, the direction must start from the top. Failure to do so will result in stakeholder resistance which in turn prevents the project from effectively moving forward while meeting objectives.

Structured project management – Failing to plan is planning to fail

One of the largest oversights made in technology implementations in Tanzania today is the lack of structured project management. Lack of structured schedule, cost, scope, quality and risk management in a technology project with the various moving parts will almost certainly result in schedule and budget overruns as well as a solution that does not meet intended objectives. Creating an environment of structured project management will require organisations to hire project management professionals with the expertise and experience to establish and apply effective project management and governance models for the project. A key challenge however is the ability to source such professionals in our local market. In February of 2016, the newly established Tanzanian Chapter of the Project Management Institute (PMI) reported less than 25 registered Project Managers in the country. While the actual number of professional Project Managers in the country may be higher, this number is still shockingly low and a reflection of the infant state of the profession locally.

Complexities

Until recently, the process to select Project Managers for most Tanzanian organisations involved nomination of individuals without requiring any professional project management expertise. These individuals would typically be well versed in the function for which they work, but lacked the necessary professional project management expertise necessary to manage a complex project. As a result, these individuals may focus on the technical component of the project and completely leave out management of schedule, budget, scope, quality, risk and other Project Management Knowledge Areas to the required level. With this approach, schedule overruns are inevitable. Schedule overruns will then require additional budget for the additional effort spent by resources. In the absence of this budget, quality will suffer. In addition, if scope and risk are not adequately managed, this puts additional stress on the available time and budget. In essence, it is setting oneself up for failure. All these moving parts mean that an adhoc style of project management is inadequate to ensure projects objectives are met. While the market is now slowly beginning to move in the right direction, the country still has a long way to go. Organisations must employ professional project managers to ensure effective management of complexities of technology projects.

Organisational change management strategy – End user adoption is the ultimate goal

The success of a technology implementation is directly tied to the degree to which the intended users adopt the solution. An error free, working application with all the bells and whistles in the world is still a failure if the people in the organisation are not willing, and/or able to use it. Technology often brings change to the way people do things, and it is human nature to resist change. In a CIO Survey conducted by consultancy firm Deloitte to identify the top 10 barriers to implementations, 82 per cent of respondents identified Resistance to Change as a leading barrier. It further found that of the top 10 barriers identified, five can be addressed by developing and implementing a structured change management programme.

Change Management in technology projects is concerned with the approach to ensuring organisational readiness for the solution, with the ultimate goal of successful end user adoption. Technology projects must employ a Change Management Strategy to create awareness, understanding, skills and ultimately ownership for the solution.

Understand the need for change

One of the first things a project must establish is ensuring key stakeholders understand the need for change. This is especially critical for the project sponsor and leadership as well as the intended users. Technology projects require a high level of commitment from key stakeholders during implementation. Commitment cannot be achieved without a firm understanding and acceptance of the project objectives and vision. A detailed communication plan and training strategy must be employed towards raising and maintaining awareness, understanding and skills throughout the project. Only when these gaps have been addressed, will the technology solution be embraced and full ownership by the users be achieved.

The success rate of technology projects globally and in our region remains shockingly low. Though there are many factors that this can be attributed to, senior management commitment, structured project management and organisational change management are three key areas which are often overlooked in technology projects in our region.Organisations must ensure leadership understands and actively pursues the vision which the technology is working towards, invest in professional project managers to drive projects using structured approaches and methodologies, and focus on end user adoption to ensure projects are a success and value is realised from technology investments.

Daniel Materu is a Management Consultant with expertise in enterprise Systems Enabled Transformations, Program Management, IT Service Management (ITSM), and Information Systems Management (ISM). Currently with Deloitte East Africa, Daniel also has experience in mining, oil & gas, utilities and public sectors working with Deloitte Australia