I was involved in a Management Information Systems (MIS) seminar a few weeks ago and the chairman, an eminent MIS Professor, admitted that things had not really changed for 15 years and that few MIS projects had ever succeeded in meeting expectations. We have all seen these grand vanity projects – they start with great razzmatazz and expectations only to fizzle out later. The forum panel members at the seminar, of which I was one, could not think of a substantial MIS project that had met expectations. The famous NHS IT project is a classic example of a failed MIS project; at a huge financial cost to us all. But it’s not just the government that gets it wrong; I have been brought into several disasters in the private sector to advise on how these expensive projects could possibly salvaged. So why do we continue to make these classic mistakes if it is so obvious that they are going to fail?
Why do these projects fail?
In my experience the answer is that the people leading new projects do not have the scars of experience from similar projects to guide them. In many cases they have not led an IT project before. They can provide a convincing argument that there is a good case for ‘immense savings’ (SIC) to be had from changing or upgrading systems. But unfortunately these savings often rely on improved efficiency and reduced personnel costs – both of which are almost impossible to deliver. It’s not only the project leader that may be responsible for failure; the blame should also be fairly shared by the management team overseeing the project with total responsibility lying with the project director.
My clients ask me how can they justify replacing their system with a more modern one. My answer is always that they cannot; however it’s not a option to do nothing, but financial justification is rarely deliverable. Like many company assets, they have to be depreciated and replaced over a period of time. Many are essential to the running of the business in a responsible manner. How does one justify those considerations financially? hey are business necessities.
Seminal changes
Of course over the last 10 years we have seen technology change industries – like the insurance industry which relied on brokers before we all started renewing our insurance over the internet. The hotel and travel bookings business again moved to the internet. The music industry – who buys a CD these days? – we just download the tracks we want from iTunes. Those companies that were slow to move to a new technology have in many cases seen disaster.
But does that apply to HR and Personnel systems? My clients that have implemented self-service personnel administration have reaped great rewards, not only in improved employee satisfaction but also in the reduction of tedious clerical work. Those companies with large volumes of seasonal recruitment have found a significant advantage in hosting their own on-line applications using applicant administration systems. They have been able to reduce employee recruitment advertising and personnel agency costs.
Replacing systems
But does this mean that you have to replace your tried and tested payroll system and your ad-hoc personnel database in order to enjoy these significant breakthroughs? In some cases it does; but very often a bolt-on system can be found that is simpler to implement and links to the existing systems therefore having the minimum of disruption on the organisation. Several of my clients have started to embark on replacing their complete HR and payroll systems with an all-singing-and-dancing modern alternative. These are grand projects that in some cases can take up to two years to implement. Unfortunately they are being blinded by the exceptional sales expertise of the supplier’s sales people. They have been blinded from taking user references to see if these systems have ever delivered the benefits they claim.
Selecting the right replacement system is not as easy as it sounds. A comprehensive survey of HR and payroll users prepared by Payroll World showed that the most popular HR and payroll systems were the simplest and cheapest to buy. The worst offenders, in terms of customer satisfaction, were the giants of the industry who’s systems took between two-three years to implement. Their clients had hardly an encouraging thing to say about these systems in any of the survey’s questions.
But my job of helping select the most appropriate system is the easy bit. The hardest part is managing the change in the organisation to enable the new software to do its job. Managing change is always underestimated. Replacing an HR and payroll system is not a linear project that can be mapped out in Microsoft Project. Nor can it be handed to the supplier of the system to manage. Managing the effect of change in the organisation is the responsibility of the project team. Employees inherently do not like change; they are threatened by change. How will it affect my job? - will I lose my job? Will it be difficult to understand the new system? – after all we are all getting older. It’s all so blindingly obvious that these issues have to be addressed but rarely do I see any active program for organisational change in the project plan.
I can remember at the start of the NHS IT programme that the proposed centralised systems were threatening our GP’s and their closely guarded patient administration systems. I for one, a dyed-in-the-wood IT enthusiast, was not happy that my medical record would be available on a central spine for everyone to view (it was supposed to be secure but is anything these days?). All of these concerns were not listened to nor were the combined voices of many of the great dignitaries from the IT industry.
So why have some projects worked when so many are failing? The answer in today’s difficult times is to tackle discrete projects with a proven short-term payback rather than grand system changes which will take years to introduce. Get a second opinion – you can be blinded by figures and sexy systems. Would you buy a house without a survey? As my first boss, Arnold Weinstock previous chairman of GEC, said to his management team – ‘If you don’t at first succeed, your successor will try again!’