Managing Information Technology

Chapter 11 • IT Project Management 427

FIGURE 11.13 Project Size Impacts Project Risk [Based on Nelson, 2005; Nelson, 2007; Sauer and Willcocks, 2007]

Characteristic of Large, Complex Project → Increased Risk of Project Failure

Project requirements captured from multiple

stakeholders

Engaging with more stakeholders results in more discrepancies in

requirements to be resolved

Large project teams devoted to the project Reliance on multiple outside contractors to supplement internal people

resources increases time and cost for project coordination

Multi-year timetable for project completion The longer the project timeline, the greater the likelihood that key

personnel will leave the organization before project completion

External environment changes require

revisions to a project plan

The bigger the project scope, the greater the likelihood that major

changes to the project plans will need to be made to accommodate

unanticipated changes outside of the control of the project leader

Special Issue: Managing Complex IT Projects

Experienced IT project managers or IT program man-
agers are increasingly likely to be asked to lead large,
complex systems projects across an enterprise, such as
ERP package implementations. Consulting firms are also
frequently contracted to help with these complex projects
because of their experiences in implementing the same
package in other organizations.
Project complexity therefore needs to be recognized
as a key characteristic of many systems development and
implementation projects in today’s digital world. To deliver
quality solutions in this type of environment, business man-
agers must realize that complexity is unavoidable and that
they must manage the associated project risks. A multiyear
field review of how large, complex projects were imple-
mented led to the identification of three high-level factors
that are critical to success (Ryan, 2003):

1.The business vision was an integral part of the project.
2.A testing approach was used at the program level
(not just at the individual application level).
3.The projects used a phased-release approach (rather
than a single-release rollout strategy).
We can also learn from early analyses of one of the
most ambitious IT projects to date: the National Program
for IT (NPfIT) of the National Health Service (NHS) in the
United Kingdom (U.K.), originally estimated to be a
10-year project with costs of about 12 billion British
pounds. In the first five years of this program, a number of
project management issues arose—including project
delays, underestimated costs, and a turnover of key person-
nel (senior sponsors). However, Sauer and Willcocks
(2007) point out that increases in the number of problems
typically associated with IT projects should be expected to

occur, due to the increased uncertainty and complexity that

result from projects of a larger scale (see Figure 11.13).

They argue that in situations where megaprojects are

required, the best course of action is to keep all stake-

holders informed of the project realities and their causes, so

that appropriate changes can be made and stakeholder

expectations can be adjusted accordingly. Nelson (2007),

however, argues that the NHS is a “prime example” of an

organization that did not learn from the mistakes made in

other large-scale modernization projects.

The need to scale up people resources with external

contractors results in project sourcing arrangements that

impact a project’s activities. Managing project complexity

therefore also requires an understanding of how different

characteristics of the project sourcing arrangements can

impact project management activities. The management

of off-site workers, including offshore workers, and

projects that involve outside vendors is becoming an

important IT management capability. In the next section,

we discuss the issue of managing virtual teams, and in

Chapter 13 we will address the challenges of managing IT

outsourcing in general.

Special Issue: Managing Virtual Teams

Project teams with members working at different locations

within the same company have become increasingly com-

mon as distributed tools have facilitated working across

national and organizational boundaries. These so-called

“virtual teams” in which team members are not colocated

and cannot regularly meet face-to-face are often formed to

take advantage of unique skill sets or knowledge not avail-

able at a single geographic location.

More recently, IT project resources are also being

selected in order to take advantage of lower labor costs.