CXO

IT Project Failures Costly, TechRepublic/Gartner Study Finds

Research indicates 40 percent of IT Projects Fail at Average $1 Million Each Year

Drew Douglas or Lisa WahrmundCorporate Technology Communications(312) 832-9300ddouglas@ctcomm.comlwahrmund@ctcomm.com
Research Indicates 40 Percent of IT Projects Fail at Average $1 Million Each Year
PARIS, November 14, 2000—A staggering 40 percent of information-technology projects fail, which costs the average IT organization $1 million each year, according to a joint study by TechRepublic, Inc. and its parent Gartner Group, Inc. (NYSE: IT and ITB). The findings were released in Paris at the Fifth Annual Project Leadership Conference, Europe’s largest gathering of project leadership professionals.

The research project is TechRepublic's first covering key business-performance issues in the deployment of technology. The research was conducted by TechRepublic, the leading Internet destination for IT professionals, and Gartner, the world’s leading business technology advisor. TechRepublic and Gartner surveyed 1,375 IT professionals in North America in September 2000.

The study indicates that the often reported shortage of IT professionals may be significantly diminished if IT staff are used more efficiently, including halting their work earlier on projects that have very little chance of success. Findings from the study include the following:

  • ·       Roughly 40 percent of all IT projects fail to meet business requirements.
  • ·       The average cancelled IT project is scheduled to last 27 weeks and is cancelled on week 14, which results in at least $1 million spent each year on IT work that does not lead to successful business outcomes.
  • ·       The average IT organization annually ties up 10 percent of its IT staff on work that contributes no value to the business.
  • ·       Project team members are keenly aware of a project’s doom a full six weeks before it is finally cancelled by management, who failed to recognize it as quickly.
  • ·       For these failed projects, an average of 11 IT professionals end up coming to work and contributing nothing of value for those six weeks.

“I would like to meet a CIO who feels that he or she can afford to waste eight of his or her staff in this tight IT labor market,” said Ted Smith, Ph.D., vice president of research products at TechRepublic. “In an era when businesses are judged by their ability to use technology to improve efficiency and capture increased revenue, our research illuminates some areas for improvement.” He noted that information technology is one of the fastest growing and most important segments of the worldwide economy.

According to Gartner, global spending on IT is expected to climb to $3.3 trillion by 2002.

The study indicates that furthering project-management training and creating a project oversight group or project management office (PMO) is associated with lower failure rates. Sixty percent of organizations don’t offer such training, the research reveals. And 61 percent of firms don’t have an oversight group in place to be sure the portfolio of projects is on course for success or terminated responsibly.

For more information on the study and a copy of Smith’s presentation in Paris, you can visit www.techrepublic.com/downloads.jhtml.

About TechRepublic
TechRepublic is the leading online decision-support company developed exclusively for IT professionals by IT professionals. It was acquired by Gartner Group Inc. (NYSE: IT and ITB) in March 2000. With the Gartner relationship, TechRepublic provides its members with the largest and most comprehensive source of IT community, content, and research available anywhere. In August 2000, TechRepublic acquired ITRadar, the leading IT marketplace connecting buyers and sellers of information-technology services. TechRepublic’s services include IT industry news, analysis, columns, articles, downloads, career-management tips, forums, a job directory, a peer directory, a vendor directory, auctions, e-commerce offerings, event listings, and electronic newsletters.

Content on TechRepublic.com is categorized by IT job segments. CIO Republic provides analysis and insight for an organization’s chief information officer, chief technology officer, and other IT executives; IT Consultant Republic features content specifically tailored to IT consultants; IT Manager Republic provides information and resources for IT managers; IT Support Republic assists help desk professionals; and NetAdmin Republic features content written specifically for network administrators.

About Gartner
Gartner provides unrivaled thought leadership for more than 10,000 organizations, helping clients to achieve their business objectives through the intelligent and efficient use of technology. Additionally, Gartner helps technology companies identify and maximize technology market opportunities. Gartner’s technology content and strong brand reach IT professionals globally through Gartner Research, its research and advisory unit; Gartner Services, its custom consulting unit; Gartner Events, including Gartner’s renowned Symposia; and atwww.gartner.com. Gartner subsidiary TechRepublic, Inc. (www.techrepublic.com) is the leading online destination developed exclusively for IT professionals by IT professionals.Gartner, founded in1979 and headquartered in Stamford, CT, achieved fiscal 2000 revenues of $859 million. Gartner's 4,300 associates, including 1,400 research analysts and consultants, are in more than 80 locations worldwide. For more information about Gartner's industry-leading products and services, please visitwww.gartner.com.

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