In our previous Quick Reads, we explored how Total Productive Maintenance (TPM) is an approach…
The title of another interesting article in The Times by Matt Ridley. He argues that large scale revolutionary or ‘creationist’ computer projects have cost the taxpayer billions and that the government has finally realised that evolution is the key to success. He uses examples like the NHS patient record system abandoned in 2013 after costing the taxpayer nearly £10 billion and the BBC writing off £100 million after five years of failing to make its ‘digital media initiative’ work.
In 2012 McKinsey research found that 17 per cent of IT projects budgeted at more than $15 million fail so badly they threaten the company’s very existence. Recent events like the failure of outdated IT systems at the NATS air traffic control centre in Swanwick also exemplify the dangers with Big Software being relied on to do it job. The new centre was six year late and hundreds of millions of pounds over budget, but the software was still based on an upgraded, old system, the failure of which brought recent travel chaos and a huge risk to many lives.
This government seems to be finally starting to learn from past mistakes and found that to prevent problems and design new systems so they work by adopting the principles of evolution, rather than creationism. The Government Digital Service (GDS), run by Mike Bracken, is a recent success story. It is not just trying to make government services as easy as shopping at Amazon or booking airline tickets, it is also reshaping the way the public sector does big IT projects to make sure cost and time overruns are a thing of the past.
Mike Bracken says the ‘waterfall approach to most big IT projects in the past consisted of writing most when you know the least. The people in charge wrote enormous documents to try to specify the comprehensive requirements of the end users, did not change them as technology changed and issued vast, long and lucrative contracts to big companies’. Their approach involves teaching the public sector departments to start small, fail fast, get early feedback for end users and evolve the system as they go.
In the book Adapt by economist Tim Harford he says that those that succeed allow for lots of low-cost trial and error or incremental change as in the mechanism Charles Darwin discovered in Mother Nature. Instead of the ‘creationist’ grand plan or giant leap approach most organisations use for managing change, natural selection incrementally discovers success through trial and error emerging by small steps.
The history of IT suggests that all things relating to information technology were the sole property of the IT department in its ivory tower, as the only people who understand the technology and the terminology. They concentrated on the needs of coders, systems analysts and infrastructure support staff, i.e. the producers of content rather than the users. Then the private sector started to realise that for major change (often integrally linked to a new system implementation) to be successful it had to be a collaboration with the end users and so they wrestled digital content out of the IT department and the technology gurus.
In the public sector the Chief Information Officers (top tech guru) were often recruited from big consultancy firms, who they subsequently commissioned to deliver big IT projects. Ideally they were ‘outsourcing the risk’, but as we are all aware this rarely happened with several examples of major consultancies ripping of the taxpayer by designing bug systems by the waterfall method so that they overran budgets and timescales ensuring ‘sell-on’ or contract extensions. For it is we who foot the bill of their poor performance and often when it does all go catastrophically wrong they walk away without any mention of penalty clauses or claw-back on the monies wasted on them for useless systems.
Better sign-off controls and programme governance are now in place at the GDS, in-house capability has been developed and more open and transparent procurement now allows the smaller, fitter and agile private sector companies to compete on a level playing field. Contract are now shorter and smaller with less risk attached. The article quotes savings so large that civil servants refused to believe them, with one example saving 98.5% of the cost of an existing contract by using a small British business rather than the incumbent multinational IT Consultancy, and it worked better.
Large capital project portfolio governance is a specialist area of ChangeWise’s expertise and successful project, programme and portfolio governance can mean the difference between success and failure of large scale infrastructure, IT and capital intensive projects. See our cases studies or the Strategic Change area of our website www.changewise.co.uk