Observation 4 - We suck at delivering large and complex change

 This blog is where I get to write about project failure.  I have written and spoken about project failure a lot over the years and my first instinct was to simply trot out all the same research here.  Then I paused and thought.  In a world that is changing rapidly as ours is, is it wise to rely on research that in many cases is 5 + years old?  Probably not and to do so would perhaps be some what hypocritical. 

So the last few weeks I have done a lot of searching and reading to ensure I have up to date information to share here.  I needn't have bothered, nothing much has changed in the research around project failures.  The Standish Groups Chaos report still says that around 70% of software development projects fail and that large projects fail at a much greater rate than small projects McKinsey still reports 70% of change initiative fail and on it goes. 

Because nothing has changed I am in fact just going to trot out the evidence, evidence that has been clear for years, this is an extract from my "IT Value Led Change" whitepaper published five years ago but still fundamentally correct today.

For all of you who are regular readers of my blogs you will know that I am fairly obsessed with the notion of IT Value. This obsession stems from a belief that IT has huge potential to make our lives and organisations substantially better and that it is our job, as an industry, to ensure that this value is delivered. You probably also know my view that in general we fail to deliver this value. The evidence of this is captured extensively in both IT and business literature. Here are some of my "favorites":
  • Mckinsey report that 70 percent of change programmes fail to deliver.
  • The Standish Group, in their aptly named Chaos report, state that only 29 percent of software development projects are successful. The remaining 71 percent being troubled or considered an outright failure. To make matters worse, the larger and presumably more important a project the lower the chances that it will succeed, with these so called "grand" projects succeeding less than 10 percent of the time.
  • Recently Forbes reported that when it comes to digital transformation, the change programme of our time, 84 percent of these programmes have failed to deliver to date.
  • One of the most staggering findings comes from a joint study between McKinsey and Oxford University of mega projects, that is projects with a budget above $10 million. They found that "17 percent of IT projects go so bad that they can threaten the very existence of the company."
Compare the McKinsey / Oxford 17 percent threatening bankruptcy with Standish's 10 percent success for grand projects and you might conclude that large scale IT projects are more likely to cause you to flirt with bankruptcy than to be successful. It may not be true but the comparison makes you pause and reflect.

It all paints a pretty bleak picture of our ability to deliver value from technology enabled change and I confess to getting a little depressed when I read these reports and write about their findings. It also makes me wonder if perhaps I'm wrong. Maybe IT can't effectively deliver value. Maybe there is no potential just hyperbole, great marketing and over blown expectations.

For those interested "The IT Value .... " whitepaper is available to download from my website

So why are we so bad at delivering large and complex change?  Some of the observations made already are part of the story.  When the world is changing rapidly as ours is the chance that our large complex project is still relevant in say 18 months is rapidly diminished.  While a rapidly changing environment is bad enough when we consider that large complex projects are the execution structure for innovation as a big idea (rather than innovation being iterative and driven through interactions) and we are beginning to create the perfect storm.

It doesn't end there however we also need to consider two more factors.  The first is that projects were never designed to deliver value, they were designed to delver capability.  Capabilities per sa do not deliver value.  Value is delivered through the consistent use of capabilities over time.  Projects can't ensure value delivery as they are temporary structures and almost always disbanded before new capabilities are embedded, improved and consistently delivering benefits (you can read more on this here).

The second issue is how we manage / lead change.  Too often we lead change through fear.  A fear based approach to change is core to many change approaches.  Take for example Kotter's 8 steps where step one is to create a sense of urgency, a crisis of sorts.  Kotter's metaphor for this is the "burning platform" and yes a burning platform will create urgency but at a very basic survival level.  There is little room for vision and aspiration when you are driven by fear.

 Sure, if there really is a crisis (a time of intense difficulty or danger) then fine, use the crisis, however, creating a crisis where one actually doesn’t exist isn't very authentic.  I suspect our teams intuitively know this and treat the declarer of the crisis the same way villagers treated the boy who cried wolf, they eventually ignore the leaders (the source of resistance perhaps).  Besides, crises create fear and fear while useful to motivate basic survival instincts does not set a solid foundation for people and organisations to thrive.  (If interested, you can read more on this and my thoughts on change here  and here and here).

We have covered a lot of ground here, particularly if you have followed the links.  In the end however I can't help thinking the the reason we struggle to deliver large and complex projects is because they are large and complex.  Circular I know but almost by definition large and complex things are difficult and therefore full of risk and so we shouldn't be surprised that they are extremely hard to do.

As always interested in your thoughts and feedback.  Does this resonate with you?  Do you have an alternative perspective I should consider?  Am I flat out naive and wrong?

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