It continues to amaze us that statistics showing the failure rate of IT implementation projects remains consistently high. There have been numerous studies that show the failure rate for CRM, ERP and other digital transformation initiatives. Simply googling “IT Project Failure Rate”, as I did, and you’ll see numbers from reputable sources that show the 2023 trend isn’t looking good.
While a few positions/reasons are given as to why this is the case (talent, executive alignment, culture etc), we’d wager that there’s one other glaring reason why implementation projects, even those that DO make it to go-live, are still considered failures. It has to do with the disconnect between technical requirements in the Request for Proposal (RFP) vs the business case that set the project in motion in the first place.
Typically, especially with line-of-business (LOB) applications, a need is uncovered to solve a series of latent or very overt pain. It’s in and around this time that the business starts (or should be starting) to quantify the benefits associated with alleviating that pain and optimizing other areas along the way (these findings are formalized in the business case - a documented reason why money needs to be spent to solve a problem). This usually warrants a Request for Information (RFI) from technology vendors, followed by an RFP, and the process begins. But while the RFP gets into the weeds about, “Can your solution do this or that?”, very seldom are the specific feature requirements tied back to the business case. This subtle but important disconnect manifests itself in poor user adoption, people working outside/around the system, disinterest in taking the training or reading the materials etc etc, all culminating into what one would perceive as a failed project/implementation. It’s one thing to get a system up and running, it’s another to recognize and reap the benefits after go-live. If you can't clearly connect technical features to the value they bring, you'll find yourself in a bit of trouble.
While situations vary from organization o organization, vendor to vendor, and project to project, failing to treat and encompass the underlying, value-focused, business case right alongside the RFP (if not clearly combining the two together) leaves digital transformation initiatives susceptible to falling off the mark and either disrupting the project altogether or reaching go-live only to leave the business scratching their heads about what got missed and why.
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