End of term report, 2011. How did IT go?

01.05.2012

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So, farewell 2011. How was it for you? Austerity seemed to be the watchword. Continued economic turmoil on a global scale, monetary crisis in Europe, upheaval across the Middle East, uncertain political future in the US, continued volatility in financial markets: no wonder organizations face major operating challenges.

Expenditure controls, especially for major non-critical projects, have tightened further than ever before. Typically, many IT projects are considered back-office or non-critical – adding to the pressure on the CIO to demonstrate value, return on investment and provide guarantees of future success. And success isn’t an easy thing to guarantee. Both Standish and Gartner have issued a number of reports over the years[1] describing the risk of failure of major IT projects.

Over recent years there have been a number of well publicised IT horror stories:

  • Mainframe crash takes ATMs down. Four-hour outage remains unexplained[2]
  • Online ticketing system restored. Baseball team announces sales to resume after system crash at automated ticketing vendor[3]
  • Corrupt file brought down antiquated IT System. Fouled up the plans of thousands in more than 40 airports[4]

A glance at the 2011 school report shows that some lessons haven’t necessarily been learnt.

  • Web fright after system crash: Computer blunder saw [retailer] lose £15million on the busiest days of the year[5]
  • A report released by an Idaho state auditor showed that problems with a new Unisys developed system for processing Medicaid claims could lead to multi-million dollars losses[6]
  • Research In Motion (RIM) announced a $100 package of applications to each subscriber affected by the three-day outage of its Blackberry network in October 2011
  • Nurses in Nova Scotia reportedly suffered at least six months of faulty paychecks due to problems with an SAP system project led by IBM[7]
  • The UK Major Projects Authority cancelled a major UK public health project, as it was “not fit to provide the modern IT services” – despite a nine year and £12 billion (US$18.7 billion) investment.[8]

This would rate as “must do better” or “needs improvement” on anyone’s school report.

With economic conditions challenging across all sectors and geographies – and no sign of any change on the horizon – IT spending is “predicted to decline by 3.7%”[9]. So it’s unlikely that more money will be forthcoming to reinforce those important projects.

Grand plans to totally overhaul IT operations using major ERP implementations or massive system rewrites come with significant risk. What’s more, the changing vendor landscape witnessed in 2011 means that organizations are likely to have less confidence in these newly-formed vendor enterprises’. [10]

Improving overall operational efficiency and supporting new business initiatives is really IT’s raison d’etre. But this can’t be at the expense of introducing risk or unknown cost into the operation.  Basically, there has never been a worse time to take uncalculated business risks.

Modernization is the key. By helping organizations modernize what they already have – proven IT assets – Micro Focus’ fundamental approach removes risk from IT change, enabling improvements in operational efficiency, time to market and business alignment. We’re helping customers sensibly manage their way through these difficult times and avoid appearing in nasty headlines.


[1] 42% either never delivered, or more than 50% late – source: Gartner Group; Package projects: years to implement, canceled 35% of the time & rarely fully deployed – source: Standish Group

[2] CIO.co.uk, January 2010

[3] CIO.com, October 2007

[4] eWEEK.com, August 2008

[5] Thefreelibrary.com, January 2011

[6] http://www.cio.com/article/678553/Auditors_ERP_Software_Woes_Could_Cost_Idaho_Millions

[7] http://www.computerworld.com/s/article/9222864/10_biggest_ERP_software_failures_of_2011

[8] http://www.computerworld.com/s/article/9222864/10_biggest_ERP_software_failures_of_2011

[9] National Computing Centre, ‘The Benchmark of IT Spending and Strategy 2011’, September 2011

[10] http://www.computerworlduk.com/in-depth/it-business/3327811/2011-changed-landscape-enterprise-software/

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