Six ways to save your IT project from the scrap heap

February 2, 2009 from InfoWorld – “To weather the current economic maelstrom, enterprises not only are reducing head count but also are cutting back on ambitious or long-term projects in IT. Knowing how best to keep your IT project in the pipeline could mean taking a cue from those best versed in achieving project approval: outside consultants...

To paraphrase Benjamin Disraeli, there are three kinds of lies: lies, damn lies, and ROI calculations for IT projects...”

180 View – The author of the article should have qualified the advice to get outside consultants to save an IT project. The advice given by a consultant that is trying to sell their product and services should be highly suspect. Later in the article we read “Most ROI calculations from vendors are flawed toward magical and large returns” However the vendors may have ideas or formatting that could potentially be useful.

The article’s first tip is to work the numbers but it does not offer much guidance. The article distinguishes between hard ROI based on reduced head count, inventory or transaction costs and soft ROI such as improved relationships. We would add that the hard numbers need to be backed up by some evidence. We also suggest trying to turn the soft ROI into hard ROI. For example, improved relationships could lead to better customer retention.

The article also talks about the importance of business need – “If the business has asked for IT's hand in a project, that should be enough.” We disagree – business need is obviously important but it is not enough. Business need should also be translated into ROI. There are some projects where you have no choice and something needs to be done. But even for these projects, there are alternatives with different benefits, costs and risks that should be quantified.