CA has published a survey of 100 IT directors which
showed that executives in charge of large projects feel that they
do not have sufficient control over them and that they often are
not even sure what stage the project has reached. The survey found
that a typical company is running 29 projects at any one time.
David Barker, an outsourcing specialist at Pinsent Masons, the
law firm behind OUT-LAW.COM, said that companies should consider
restructuring their deals to deal with the principal problem in
large IT projects.
"The first problem is to tie down at the start exactly what it
is that is going to be delivered," said Barker. "An IT solution is
an intangible thing, and very often the people in procurement are
not the people who will be using it on the ground."
Barker said that suppliers will want to race through the process
of specification of a system because it is generally part of the
tendering process, and so done for free with no guarantee of work
at the end of it. "They will want to get as quickly as possible to
the part where the clock is running," he said.
"A structural way to solve this is to create two distinct phases
to the project. One is project definition, where you actually pay
someone to do this, to design an appropriate solution so that the
scope of it doesn't keep growing throughout the project," he said.
"You could spend 10% to 15% of your project budget on this phase,
but you know what you need and you have a document of that."
Barker said that a company could choose to use whoever produced
the specification for the project itself, or in order to guard
against the specification being constructed to be the most
profitable, rather than the best, plan, the company could exclude
the supplier which produced the project plan from building the
system itself.
When actually conducting a project, Barker said that a company
must ensure that the contract itself is being followed. "Instead of
putting the contract in a dusty drawer and getting on with the
delivery on a practical level, get on with the delivery but keep
one eye very firmly on what the contract says and work to the
contract."
If disputes and cost or time over-runs do occur, Barker
recommends again sticking very closely to what procedures are laid
down in the contract. This will usually involve three levels of
escalation up the management chain, depending on the seriousness of
the dispute. Only the most serious problems will be sent to the
customer and supplier chief executives to resolve, he said.
"It is surprising how many times people will sort out an issue
before they go to their chief executive and say 'here's something
for you to sort out'," he said.
Though formal dispute resolution, arbitration and litigation are
available to the two sides in the dispute, Barker said that this
was rarely a good idea while a contract was actually ongoing.
"Ultimately you can go to court but at that point the chances of
the project reaching a happy conclusion are pretty low," he said.
"Projects really do depend on goodwill on the ground."
