Can Government Policy reduce IT Project Failure Rates? PART 2

Posted by Kevin Brady on Wed 9th August 2006 at 05:00 PM, Filed in Project /Programme Failures


Further too “Can Government Policy Reduce IT Project Failure Rates? PART 1” it is clear that the UK Government needs to transplant US legislation to the UK with specific legislative adjustments in order to ensure that both the government and non-government sectors are treated equally i.e

  • Develop a False Claims Act for the Private Sector Extend the idea behind the False Claims act with “qui tam” mentioned in URL “What can the Government Do PART 2” for the private sector and allow the whistleblowers a share of any private sector supplier fraud settlement they might bring on behalf of an employers client.
  • Make IT Projects /Programmes the responsibility of Treasury & Finance Directors Make it a legal requirement for all Private and Public Sector IT projects above a certain value (say £1 million) too automatically come under the direct financial responsibility of corporate finance directors or in the case of the government the treasury department. The legal requirement also needs to make it an offence in the public or private sector for people engaged in the initiation of an IT project (£1 million + budget) not to advise the Treasury or the Finance director of a company that such a project has been initiated.
  • Make it an offence for any Government Department to allow any Software Houses or Management Consultants where the contract value exceeds £1 million into any tendering process without the following :-

    • Due Diligence Scoring - The tendering companies need to achieve a specific Due Diligence Score based around an approved Due Diligence test. For ideas as to how to carry out an effective Due Diligence Test, please stay tuned for a post on Monday of next week.
    • All tendering companies must have head offices in countries other than known tax havens - Some media articles point out the big “Money Machine” Software House and Management Consultancies, which operate in the UK, take billions of pounds of taxpayers’ money, and only pay 10% corporation tax due to tax havening of their revenues. At least a government taking this step would have the chance of getting some of their money back from failed projects.

  • Increased Private Sector Accounts Transparency
    Currently it is not a requirement for UK companies to separate out of reported operational expenses a companies IT costs and the proportions of these costs spent on projects and operational expenses. For years, corporate UK has been burying in their accounts billions of pounds in IT project /programme loses under various spurious cost categories, keeping the shareholders and the media in the dark. However, just occasionally the losses are so huge that businesses have to come clean because they just cannot find a big enough sweeper and associated carpet.

    The example, which sticks in my mind, is Sainsbury’s and its huge write off £260 million in the renegotiating of its major outsourcing contract due to supply chain technology problems. It is significant I think that one of the “money machines” namely Accenture has been removed as an outsource partner and all IT outsourced services are being brought back in-house.

    Speaks VOLUMES!!

  • Legislation Requiring Professional Qualifications

    The media is already making rumbling noises about the need for Professional IT Qualifications. The government should award Royal Charter status to a number of IT institutes such as the Institute of Project Management and others which have sprung up in recent years and make available for the first time Chartered Professional IT qualifications.

    All IT projects above a certain size should have a minimum number of designated IT professionals with chartered status (Business Analysts, Technical Architects, System Analysts, IT Security Analysts, Project Managers, Programme Managers) working on these projects. It should be a statutory requirement for the numbers and categories of chartered IT professionals to be reported in a company’s annual accounts and Treasury select committee reports.

    As with my own ACII (Chartered Insurer) qualification, all those with chartered status should stand to lose their qualification if they breach their respective institute’s code of ethics or incur a criminal record. 

  • Integrity is then built into the system from the ground up!

    As mentioned earlier annual IT project audits should annually check for the presence of such key-chartered IT personnel and the numbers recorded in the annual accounts.

This post in my view is just a starter for 10. You don’t have to agree with my views on what needs to be done, but a government sitting on its hands and doing nothing is simply not acceptable. The government has got to take the initiative in trying to create an economic and regulatory environment which promotes IT project /programme success and not failure.


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