IT leaders: You’ve delivered the project, but have you delivered the value?

michael-garrett2.jpgTrue or false: An IT project that has been delivered on time, on budget is a success.

 

Many IT projects don’t even meet this standard. But I would argue that even those that do are not automatic successes. Why not? Because IT generally (and I think I can say this after years spent in enterprise IT professional services) isn’t defining success correctly. Success is when the business case is delivered, not when the IT project is delivered.

 

How value gets missed

I’ve had the opportunity as head of HP Software Professional Services to watch our customers’ IT transformations. In any IT project, it can be easy to focus on delivery and forget a bigger question, which is, how are you ensuring you will get the value from the project?

 

Quite often IT will do a project with great intent. But as it gets toward the end, the value slips away: You don’t redeploy the people, or you don’t really change the practices, or you get the new tool but you’re not using it in the right way.

 

We see this with customers quite frequently, in fact. At the end of a project, the feeling in IT is, ‘We’re done. Great! The business got what it needed … Next.’ And then it’s on to the next crisis. But very rarely do you find organisations that actually track the project to see whether it’s delivering the savings that they need it to.

 

What world-class IT organisations understand about value

As I’ve written in my previous posts, with any IT project, you have to understand the business case. Nowhere is that more true than in making the final estimation of the project. We see this in mature organisations: They will carry on with that business case. They study the metrics, redeploy the people, make sure they’re getting the return on the automation (or whatever it is). If it’s cloud, for example, they measure to determine how much the trackable cost of their IT maintenance is coming down.

 

What makes the difference between world-class and pretty good? It’s following through on the business case and in effect giving yourself a report card. Have you really made these savings? Have you really delivered the benefits? And then ask the hard questions about whether you have or haven’t.

 

Now, in practice, this can be difficult. More than anything, I think it’s a matter of business culture. If IT is being run as a business (or if you are taking steps in that direction), then you understand you’re not doing IT just for the sake of IT. When IT is run as a business then naturally the question follows: For the investments we’re making are we gaining the returns we expect?

 

Bake value metrics in from the beginning

Metrics that look at value delivered should be part of any project plan. When they are in there from the beginning this helps with that cultural attitude I talked about earlier. People expect that they are going to report on results and measure how the project is bringing value (or if it’s not, they’re going to take corrective steps).

 

The question of course is what to measure and how you will measure. Again, you’ve got to go back to the business case. Now, business cases are a mix of very concrete, measurable things, along with other elements that are less measurable and indirect. This is where you have to do the hard work to determine what metrics will tell you whether you’ve been successful or not. You can’t just say ‘Well, we don’t have that any more, and we got rid of that, so it all adds up to roughly this…’ Not good enough.

 

This is an emerging discipline in IT. Grounded in a Six Sigma measurement culture, Intel pioneered a way to formalize this definition of value capture metrics and to institutionalise the before and after measurement of every major IT project in terms of business value captured1. For the last three years, at the request of our CFO Cathie Lesjak, HP’s internal IT function is doing the same and I see gradual adoption of this discipline among our clients.

 

If you plan for business-value capture metrics from the beginning and you give enough thought to how you are going to measure them, when you get to the end of any project you should see confirmation of the value IT delivered to the business. And that—while not easy to do—leaves IT in a very good place.

 

Learn more about HP Software Professional Services.

 

1: See ‘Measuring the Business Value of Information Technology’ by David Sward, Intel Press 2006.

 

Related links:

 

Blog post: 3 key factors for successful software adoption

Blog post: You want to implement out of the box? Here’s how

Blog post: Are you setting your IT transformation up for success?

Blog post: 3 challenges that can keep you from maximising cloud benefits

Blog post: How vendor management can bring cloud success

Labels: IT Value
Comments
Isabella Johnson(anon) | ‎07-18-2013 12:34 AM

Thank you for sharing this post! It's good that you can learn from professionals. We often begin projects, we conduct but watching point is final.

Bridge Alison(anon) | ‎07-18-2013 05:37 AM

You'll right An IT project that has been delivered on time, on budget is a success.
We have a IT project very useful , try http://nulledshare.com or http://dnmw.net and you'll see how important is it.

Amulya Review(anon) | ‎11-20-2013 08:19 PM

Six SIgma is what we follow at our organization. We employ specialists to train our employees to achieve it. Being a professional , I'm very happy with the way you presented the way Delivery of projects in relation to time and its value.

 

Smiles,

 

Amulya

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