Slide deck for week 9 of the course Technology in the Public Sector, Northwestern University, Summer 2012

1. Week 9: IT Governance and Funding
Technology
in
the
Public
Sector
Northwestern
University
MPPA
490
Summer
2012
-­‐
Greg
Wass
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2. Outline
¤ Why do public sector IT projects fail?
¤ What is IT governance?
¤ Project portfolio
¤ Business case / ROI
¤ Project tracking / QA / IV&V
¤ Funding and accounting for IT projects
¤ Capital vs. operating
¤ Bonding
¤ GASB 34
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3. Why
do
projects
fail?
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4. IT project fails
¤ A U.S. survey of IT projects conducted by the Standish
Group (2001) found that success rates varied from 59% in
the retail sector to 32% in the financial sector, 27% in
manufacturing and 18% in government.
¤ The British Computer Society (2004) found that 84% of U.K.
public sector projects resulted in failure of some sort.
¤ The IRS managed “a string of project failures that cost
taxpayers $50 billion a year — roughly as much as the
yearly net profit of the entire computer industry.” *
* Source: Geoffrey James, “IT Fiascoes and How to Avoid Them,” Datamation, November 1997
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5. What do we mean by fail?
¤ Never finishes installation—project abandoned
¤ Installed but rejected by users and removed
¤ In place, being used, but with workarounds
¤ In place, but causing problems
¤ In place, but reducing productivity
¤ In place and being used as intended, but took much
longer to implement and cost much more than budgeted
Source: John Cuddeback, “Why Do (Many) Health IT Projects Fail?,” Georgetown University, 2007
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6. Why do projects fail?
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7. More critical failure factors
Source: Shaun Goldfinch, “Pessimism, Computer Failure, and Information Systems Development in the Public
Sector,” Public Administration Review, Volume 67, Issue 5, pages 917–929, September|October 2007
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8. Still more…
Source: Shaun Goldfinch, “Pessimism, Computer Failure, and Information Systems Development in the Public
Sector,” Public Administration Review, Volume 67, Issue 5, pages 917–929, September|October 2007
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9. How do projects succeed?
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10. þ Critical success factors
1. Executive sponsorship
2. IT governance
3. Business needs / requirements
4. Planning / design phase
5. Project management
6. Funding
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11. CSF #7: Decrease project size
¤ Decrease the complexity of individual projects
¤ Decrease project durations, reducing exposure to change
¤ Improve the quality of the estimates
¤ Reduce the amount of each project “wager”
¤ Facilitate cancelling or restarting efforts that get off track
without undermining the credibility of the larger initiative
¤ Simplify vendor management
Source: Payson Hall, “A Losing Gamble with IT Projects,” Cutter IT Journal, December 2003
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12. Executive leadership styles
Source: David Feeny, “Public Sector Projects: Set Up to Fail?,” OECD Public Management Service, 2001
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13. Executive leadership styles
Source: David Feeny, “Public Sector Projects: Set Up to Fail?,” OECD Public Management Service, 2001
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14. IT governance
Source: David Feeny, “Public Sector Projects: Set Up to Fail?,” OECD Public Management Service, 2001
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15. IT governance: example
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16. Project portfolio analysis
¤ Project capacity
¤ Projects list
¤ Prioritization / ranking / criticality
¤ Continuous review
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17. Project portfolio matrix
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18. Business case / ROI
¤ Project charter / project description
¤ Scope
¤ Estimated cost
¤ Ongoing cost
¤ Benefits, tangible and intangible
¤ Business case
¤ Return on investment analysis
¤ Hurdle rate, break-even point
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19. Business case
Source: Amanda Brown, “Breakthrough or Burden?,” accessed 8/10/12 at http://www.charitiesdirect.com/
caritas-magazine/breakthrough-or-burden-548.html
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20. Project tracking / QA / IV&V
¤ Periodic (quarterly? weekly?) reporting on project status
¤ Scope / schedule / budget
¤ Public vs. internal reporting
¤ Quality assurance consultant
¤ Independent validation and verification
¤ Program management office
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21. Program management office
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22. PMO: example
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23. IT governance/PMO checkpoints
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24. Deliverables, reviews, sign-offs
Source: Amanda Brown, “Breakthrough or Burden?,” accessed 8/10/12 at http://www.charitiesdirect.com/
caritas-magazine/breakthrough-or-burden-548.html
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25. IT project budgeting
¤ Large vs. small projects
¤ Applications vs. infrastructure investments - strategy
¤ Capital vs. operating expenditures
¤ Useful life
¤ Project governance
¤ Constraints
¤ Criticality to the organization vs. cost and risk (portfolio)
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