Advance Praise for The Success Healthcheck for IT Projects

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3 Advance Praise for The Success Healthcheck for IT Projects An Insider s Guide to Managing IT Investment and Business Change J. A. Flinn speaks with a wisdom gained from many years of wishing for the best but preparing for the worst on complex IT and business change initiatives. Results risk management is critical. Anything that can be done to improve the probability of success of your IT projects is worthwhile doing, so start with reading this book! Mark Bryant Partner, Infosys Flinn created a mix of very practical, realistic and performance-driven solutions by combining her IT experience with the wisdom of timeless principles. Her lively, probing, authentic style is consistent with her view of seeing these complex systems as ecological living organisms where people and systems integrate in a natural way. Professor Peter Robertson Author of Always Change a Winning Team Founder, Human Insight Flinn distills a complex topic into a clear usable approach for leaders to achieve real success by significantly improving project portfolio returns, and shows leaders how to avoid the staggering project failure rates which is common today. Flinn s latest publication is a real winner. Susan Breniman Associate Director, Proctor and Gamble Once again we sat round a table scratching our heads wondering why all the things we had spent so much time planning completely failed to materialize! J. A. Flinn explains with great clarity why project implementation and benefits realization is an art and needs the right combination of people, processes and planning to succeed. Arvind Mathur Partner, Hiedricks and Struggles

4 I have met J. A. Flinn in exotic locations and have been impressed by her skills, knowledge, love for life, love for travel and the book that she has produced. I have been a business coach for most of my business life and it this capacity I have worked with many, many business. The Success Healthcheck for IT Projects gives amazing business tools. Well done! I make it an important step in the education of my clients to read and master J. A. Flinn s book! Martin Jimmink Master Coach, Action International Business Coaches

5 THE SUCCESS HEALTHCHECK FOR IT PROJECTS AN INSIDER S GUIDE TO MANAGING IT INVESTMENT AND BUSINESS CHANGE

6 100 percent of IT projects intend to succeed, but 93 percent fail. Just 7 percent are star performers. Which is yours?

7 THE SUCCESS HEALTHCHECK FOR IT PROJECTS AN INSIDER S GUIDE TO MANAGING IT INVESTMENT AND BUSINESS CHANGE J. A. FLINN John Wiley & Sons (Asia) Pte. Ltd.

8 Copyright # 2010 J.A. Flinn Published in 2010 by John Wiley & Sons (Asia) Pte. Ltd. 2 Clementi Loop, #02 01, Singapore All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as expressly permitted by law, without either the prior written permission of the Publisher, or authorization through payment of the appropriate photocopy fee to the Copyright Clearance Center. Requests for permission should be addressed to the Publisher, John Wiley & Sons (Asia) Pte. Ltd., 2 Clementi Loop, #02 01, Singapore , tel: , fax: , enquiry@wiley.com. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering professional services. If professional advice or other expert assistance is required, the services of a competent professional person should be sought. Neither the authors nor the publisher are liable for any actions prompted or caused by the information presented in this book. Any views expressed herein are those of the authors and do not represent the views of the organizations they work for. Proprietary terms include: Predictable Accountable Results (PAR), Results Risk Management (RRM), Keep, Kill or Reconsider, 7 Keys to Portfolio Success and 8-Fold Path to Project Success. Requests for permission to use these or to license the methodologies should be addressed to enquiries@sheltonmethods.com. Other Wiley Editorial Offices John Wiley & Sons, 111 River Street, Hoboken, NJ 07030, USA John Wiley & Sons, The Atrium, Southern Gate, Chichester, West Sussex, P019 8SQ, United Kingdom John Wiley & Sons (Canada) Ltd., 5353 Dundas Street West, Suite 400, Toronto, Ontario, M9B 6HB, Canada John Wiley & Sons Australia Ltd., 42 McDougall Street, Milton, Queensland 4064, Australia Wiley-VCH, Boschstrasse 12, D Weinheim, Germany Library of Congress Cataloging-in-Publication Data ISBN Typeset in 9.5/12pt Palatino Linotype by Thomson Digital, India Printed in Singapore by Toppan Security Printing Pte. Ltd

9 Contents Foreword xv Acknowledgments xvii Introduction: In The Beginning There Was... a project that succeeded Success Founded on Robust Research Prestory xix xx xxii xxiii PART 1: PRODUCTIVITY 1 Chapter 1: IT Projects Are Investments The Back Story on Productivity The Productivity Challenge and IT CEOs Say They Cannot Continue to Introduce Change in the Same Way What Is Success? Project Failure Is the Untapped Source of Productivity Growth Why This Failure Rate Continues to Exist Improving Productivity Is a Process

10 viii THE SUCCESS HEALTHCHECK FOR IT PROJECTS Survival of the Fittest s Chapter 2: Measure Success Measuring the Cost of Project Failure The Functional Yield Measures of IT Project Productivity Simple Return on Investment The Functional Yield The Cost of a Little Under to the Business Improving Project Productivity Chapter 3: Take Action to Lift Success Publicly Acknowledge That Success Is Not Guaranteed Own Up to the NPP Ratio Yield and NPP Ratios Write-offs and Functional Shortfalls Value the Reduced Risk of Failure (to Achieve Business Results) Results Risk Management TM Contingency Planning for Results Risks Accountability for Results Risk Management The Benefits of Setting Up for Success Address Risks to Success Repeated Project Failure Is a Governance Issue CIO Moment: Portfolio Governance and the 7 Keys to Success Predictable Accountable Results (PAR) Chapter 4: Benchmark Productivity from IT Projects: Evaluating the Cost of Failure Elements: Collecting Your Own Data Funds Budgeted and Spent

11 CONTENTS ix Time Functions Perceived Value The Functional Yield in Reality A Window into 3 IT Portfolios Takeway Chapter 5: Diagnosing Productivity Health The Results Diagnostics Project Health Factors Project Health Check Use of Good Practices Recognition of Business Experience with Projects Tangible Project ROI, or Hard Productivity Gains Project Health Diagnosis Get Your Data Together Project Health Diagnosis Summary Framing the Diagnostic for Decision and Action On Results Acting to Lift PAR Lift Project Performance by Addressing the Failure Rate from Productivity PART 2: PROBABILITY 79 Chapter 6: Talent Scouting Spotting Success Early Percent of Projects Intend to Succeed 81 Past Performance Predicts Future Performance 83 Predicting Success 84 All Projects Have Risks When to Assess Probability of Success Results and Success Take More than Delivery

12 x THE SUCCESS HEALTHCHECK FOR IT PROJECTS The Foundations of the 8-Fold Path to Project Success The Complications of Countries Dangers in Overlooking the Obvious How to Set a Project Up for Success Why Start with Productivity Chapter 7: The 8-Fold Path to Project Success What Does this Look Like? An Archetypal Project The Project What are Your Real Results? Trust and Verify Chapter 8: Business Results Are a Process Results Delivery Process Maturity Maturity and Results Deliver Processes PART 3: PROJECT 113 Chapter 9: Fold 1, Intent Is Clear Results Are... Return on Investment Implies Results Results Are Clearly Specified Generating Results Financial Results Results from Competitive Capacity or License to Operate Requirements Intangible Results Intentions of the Project Process Intended Time Frame for Results Intended Quality of Result: Quick Fixes or Strategic Change

13 CONTENTS xi Intended Impact to Stakeholders Intent s Impact on the Broader Picture Chapter 10: Fold 2, Business Case Is Robust Results of Investment: What s the Bottom Line? What Is the Real Investment? Quality of Business Case Evaluating the Business Case Financials Bottom-Line Value Now, a Secret... Working Around This Secret Project Results Sensitivity Chapter 11: Fold 3, Results Delivery Process Is Reliable How Reliable is the Results Delivery Process? Simplifications Undermine the Results Delivery Process KISS: 6 Keep It Simple Symptoms Chapter 12: Fold 4, Motivation Is Energized 159 Risk: Accept or Reject People Are Part of the Business Results Equation the Likely Response 161 Adaptability 161 Resistance Psychology Not Taught at School 163 Resistance Can Be Sensible Motivation Is Multifaceted Where Do Interest, Engagement, and Energy Go? Conflicting Interests: Rational Dysfunctions People Choose to Act or to Ignore the Project

14 xii THE SUCCESS HEALTHCHECK FOR IT PROJECTS Chapter 13: Part 3 Your Assessment PART 4: PRESENCE 181 Chapter 14: Background to Part 4 Process: Success in the Business Context Business Results from IT Projects Require Continued Presence Present to Future Implementation Issues Collateral Damage Costs An Archetypical Business System Diagnosing the Business Context for Success Chapter 15: Fold 5, Project Aligns to Current Strategic Position Risks to Business Results from the Strategic Context Strategic Context Affects Results Leadership and Vision Affect Results Culture Affects Results Chapter 16: Fold 6, Operational Context Supports Project Intent Operational Context Reinforce IT Practices and Projects The People Thing and Projects Financial Policies and Project Results Chapter 17: Fold 7, Flow Favors Project Intent Previous Experiences with Change in the Business Quality of Local Management Reputation of the Project Takeway

15 CONTENTS xiii Chapter 18: Fold 8, Balancing Dynamics to Aid Project Intent Pace Tipping Points Rain, Erosion, Landslides, and Growth Toxic Build-Up Regrowth Rates and Burnout Bulldozers, Slash and Burn, and Other Ways to Destroy Short-Termism and Expediency Burnout Moving with Time Chapter 19: Lifting Performance from Failure to Success Diagnostic: What are the Risks to Business Results? Are Business Results Probable? Project Risks to Results Assessment Presence of Risks from Business Context Assessment Expected Results from the Project Identifying the Risks to Address CIO Moment: Credibility Check Take Action to Improve Business Results from IT Projects PART 5: PERFORMANCE 271 Chapter 20: Where To? Success Is a Journey, Not a Destination Leadership Implications Assess Risks, Take Action Performance Reflects Proficiency Experience Is More than Headlines Where Are You Now? Where Do You Want to Be?