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March
17, 2002 |
Waste Management
| Although the Internal Revenue Service has
significantly improved its internal processes since it implemented
its first major information technology (IT) system in the
1960s, the agency has spent billions of dollars over the years
on mainly unsuccessful IT initiatives. But Mark Nelson, a
management professor in the Lally School of Management and
Technology, recommends tips that can help such a huge organization
streamline processes, increase efficiencies, potentially save
billions of dollars, and prevent a cycle of multiple IT failures.
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Photo credit
: Mark McCarty |
| How
to Implement a Successful IT System
Nelson suggests taking the following measures
when beginning large-scale IT projects:
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•Open
the lines of communication with and between project managers
and the organization. Clear, consistent, and open communication
is critical to the success of enterprise IT projects.
•Implement
feedback mechanisms that properly indicate troubled initiatives
or over-spreading of resources. This includes encouraging
employees to report troubles regularly, even if it means
addressing—or troubleshooting — unforeseen issues.
•Establish an environment where
it is safe to make mistakes. Organizations will often increase
their commitment to an unsuccessful course of action because
the fear or penalty of failure is so great. •Freedom
to make mistakes enables organizational learning.
•Set priorities
and schedules for each of the parts of large-scale IT projects.
Establish clear project phases and realistic goals that
take into account overload issues that often threaten to
derail large-scale IT projects.
• Any
changes to organizational structure or processes must be
accompanied by new rules to support the changes. Otherwise
individuals often revert to prior behaviors. |
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Each year, private corporations and government
agencies in the U.S. spend billions of dollars implementing large-scale
IT projects — only to see 50 to 70 percent of them fail,
according to the National Research Council. In this context, “large-scale”
is defined as a project lasting longer than six months and costing
more than $10 million.
“Large-scale IT projects rarely fail only
once,” says Nelson. “The IRS in particular has been
on an IT roller coaster ride in the past and followed a cycle
of escalating budget, scope, and scheduling problems that have
eventually lead to the termination of many projects before they
reached their objectives.”
Nelson will present his work at the International
Resources Management Association meeting in May in Philadelphia.
His papers, “Re-escalation Cycles in Large-Scale Government
Information Systems” and “Discovering the Causes of
IT Failures in Government Agencies,” were co-authored by
undergraduate students Taylor Smith ’03, an IT major, and
Diana Thomas ’03, a dual management and electronic media,
arts, and communication major (both pictured above with Professor
Nelson).
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