Technology: When Things go Wrong — IT Failures — #ITFail

Wikipedia defines failure as “the state or condition of not meeting a desirable or intended objective, and may be viewed as the opposite of success.”  While lessons learnt from a failure can serve as a spring board for a followup major success, more often than not, failures can become repetitive, costly, and painful.

In the world of IT, IT project failure is defined as “projects that are late, over-budget, or do not deliver planned benefits.”  The losses resulting from IT Project failures are typically fairly self-contained, amounting generally to a complete or partial write-off of the resource expenditures that were originally funneled into the project.  Beyond project failures, other types of IT failure include data security failures and system malfunction.  Losses from these other types of failures have the potential to be significantly higher and more open ended.  A white paper in 2009 by Roger Sessions estimated the cost of all global IT failures to be as much as $6.2 trillion, although some dispute that the amount could be that high.

The causes of IT Project failures typically are simply that the project taking longer than estimated or the project exceeds the allocated budget.  A Techbyte survey found that 61 percent of projects take longer than expected and 74 percent run over budget.  Michael Krigsman, CEO of Asuret and long-time blogger on the topic of IT failures, wrote that “IT failures happen when managers exercise insufficient judgment, possess too little experience, hire the wrong people, ignore warning signs and, crucially, fail to involve affected employees in a way that eases the path to success.”

But other types of failure can be hugely costly.  Richard Hunter, analyst at Gartner,  lists cases where a single IT failure led to catastrophic results for businesses:  “Cardsystems Inc. lost 95% of its revenues within 3 weeks of a breach it announced in 2005, and was sold shortly thereafter for a fraction of its pre-incident worth.  ComAir didn’t fail as a result of the December 2004 incident in which their crew scheduling system went down on Christmas Eve, stranding an estimated 30,000 passengers during the Christmas holidays; however, the company lost 7% of its revenue for the year, a pretty big deal for an airline, and was the subject of an FTA investigation, which no one much enjoys.”

And what of startup failures?  IT entrepreneurs struggle to avoid failure.  Marc Andreessen, co-founder of Netscape, talked of the feelings of high-tech entrepreneurs:  “You flip rapidly from day to day: one where you are euphorically convinced you are going to own the world, to [one] in which doom seems only weeks away and you feel completely ruined, and back again. Over and over and over.”