Managing IT Projects: Understanding Risks and Strategies for Success

1. Lecture 15 Chapter 8 Managing IT Project Delivery

2. Announcements Business Case Returned today. Grades out of 40: Upper quartile: 35 Median: 33 Lower quartile: 31 Optional draft team business analysis this Thursday Final report due in 2 weeks. No late submissions.

3. Themes for chapter 8 • Understand possible sources of IT project risk and how these can be managed • Recognize different approaches to project execution and understand their relatives merits • Understand the value of both consistency and agility in project management

4. What is an IT Project? • Clear beginning and end • Can be any size or complexity level • IT focus – delivered by IT department • Managed by a project manager

5. Project components • Roles and responsibilities • Documented plan • What does ‘finished’ mean? • Timing • Budget • Risk register • Issue register

6. Why are IT projects difficult to manage? Some things are easy to get wrong… • Amount of change involved • Time required • Misunderstanding of requirements

7. Major sources of implementation risk • Project size • Experience with the technology • Requirements volatility

8. Effects of Additional Risk Factors (Large Size, High Technology, High Requirements Volatility) on Project Risk

9. Project Implementation Dip • Most projects don’t go smoothly all the way • New system going live common point • Expectations not always realistic • Short term downward shift may be necessary • All happens in middle of business cycle and worker turnover • Need to focus on end goal to get through value of change when people are complaining • Ideally see it before it comes and get people ready

10. What People Expect and What Often Happens at System Cutover

11. What would you do as PM to manage the performance dip?

12. Portfolio Risk • Multiple projects can add or reduce risk • Low-risk not always good • All high-risk is vulnerable • Identify risks in all projects, then consider combined portfolio of risks

13. Portfolio risk • Multiple projects can compete for resources • Changes in one project can affect another • Do projects complement or compete with each other? • Need to have a portfolio mindset – not focus on just one area

14. Governance • IT portfolio needs to be managed consistently with company strategy • There should be contingency plans • IT oversight committee • IT expert

15. Project Categories and Degree of Risk

16. Risk Assessment • Risk profile questionnaire • Higher risk score, higher management approval required • Repeated several times throughout project • Different perspectives on risk expectation can lead to disaster

17. Risk and Return Distribution for Portfolio of Projects

18. Development Methodologies A development methodology is a sequence of phases that a project will follow. • Analysis and design • Construction • Implementation • Operation and maintenance

19. Adaptive Methodologies Adaptive methodologies often focus on prototyping and rapidly going through the normal development phases several times • Iterative – design, construct, implement on each iteration • Fast cycles • Early delivery of limited functionality • Require skilled management to quickly change plans • Analysis of value such as ROI becomes difficult

20. Project Management • No single correct plan • Management Tools • External integration tools • Internal integration tools • Formal planning tools • Formal result controls • See table: Tools for project management

21. Tools for Project Management

22. Influences on Tool Selection • Low requirements volatility/low tech projects • Easy to manage • Least common • PERT (program evaluation review technique) • CPM (critical path method) • Low requirements volatility/high tech projects • Difficult to manage • Eg. Converting mainframe system, developing web access • Outputs well defined • Technical complexity drives characteristics of successful manager • Formal planning not likely to add as much value

23. Influences on Tool Selection (ctd) • High requirements volatility/low tech projects • Involve users in design, development and implementation • Develop user support • Formal planning and control tools help • Close, aggressive management of external integration • Leadership from management not technologists • High Requirements Volatility/high-tech projects • Managers need technical expertise • Ill-defined projects common • Formal tools useful once clarity is reached in direction • Cross effects of different factors becomes important

24. Project Management • Relative Contribution of Management Tools • Depends on specific project • Results-oriented tools work in structured/formal environment • Depends on corporate culture • Emergence of Adaptive Project Management Methods • Approaches to design, deployment, implementation and investment that assume a need to gather information and learn as one goes. • Not really effective universal methods yet • Software Development Life Cycles • SDLC breaks down development into stages: • Analysis and design • Construction • Implementation • Operation and maintenance

25. Project Management (ctd.) • Adaptive Methodologies • Quickly build rough preliminary version • Iterate through stages rather than finish every stage • Fast cycle through stages • Aim to deliver limited functionality fast • Require skilled staff • Adaptive Methods and change management • Intensely involve users in evaluating outcomes • Strictly control migration of system features from development, testing to production • Separating stages avoids major problems

26. Process Consistency and Agility in Project Management • Balancing tension between process consistency and process agility • Tools useful one place shouldn’t necessarily be applied to everything • Success in balance often includes minimal formalization • Flow • Understand interrelationships between projects • Completeness • Keeping track of all tasks in project • Visibility • Getting info on status of rest of project

27. Final exam The final exam will be on Thursday, June 9 at 12pm – 3pm. There are three sections: 1. Short answers (~25%) 2. Long answers (~25%) 3. Case study (~50%) The exam is closed book, and designed to test your understanding of concepts from class

28. Preparing for the final exam • Review the text book and class notes, including cases • What are the main messages in each chapter? • What are the main lessons from each case? • Focus on understanding the content rather than memorizing details

29. Final Exam Sample Questions Short answer: • What is the difference between security and reliability? • How does standardization affect business opportunities? • In what ways is IT infrastructure different from other infrastructure resources? • What is virtual integration and which company did we study who specializes in it?

30. Final Exam Sample Questions Long answer (~250 words) • Discuss what risks are associated with major IT projects, and what a company can do to mitigate against them • Describe the challenges associated with educating users of IT in a company, and what IT-focused companies can do to help their employees

31. Case study questions • Questions will be short and long answer from the case • Identify and analyze core issues, in a similar way to how we have discussed cases in class