Who’s got money to burn?

By Beth Cooper, October 5, 2016

If you’re considering a digital business transformation project, chances are you’ve got an eye on potential savings. Those savings might not be the sole reason why you’re investing in the technology, but sure as eggs are eggs they’ll be included in the financial appraisal.

Your appraisal will identify the cost of going ahead with the project. It will list the consequences of doing nothing when competitors are moving to a more efficient way of working. But does it also include an estimate of the costs of a failed or only partially successful implementation?

Nobody likes to think about failure at the outset, but they should. Evaluating the possible costs of failure goes against all the perceived advantages of a positive, can-do attitude. But it’s too easy to get sold on the benefits of a software application and, in thinking of the rosy future, forget the process of getting there. Estimates of the costs of failed projects are huge. A survey in 2015, suggested $400bn each year is wasted. The tragedy of this stark statistic is that efficiencies – cost savings – are a huge driver for the projects in the first place.

There are a number of reasons why projects fail and why business then burns money in trying to get transformation initiatives back on track. Very occasionally, there may be problems with the software itself. But most of the reasons could be grouped under a heading ‘lack of preparation’.

In their enthusiasm to make headway and deliver the best possible return on investment, the exact opposite is the most likely outcome. Variables that should be considered aren’t. The impact on employees is ignored, buy-in is assumed but not assured. A stuttering start leads not to a gradual improvement in business processes but to a patchwork of half-adopted systems and half-engaged users. With predicted returns looking unlikely, organisations then start spending to dig themselves out of a hole. Some even blame the software and start the search for an alternative.

Where success is achieved, where organisations, and their employees, feel the benefit of changed processes and smarter business strategies, it’s because the software is used. Not a little bit, but fully and by everyone. Not just the techy types or the enthusiasts, but by the technophobes and the sceptics, by the team in Hong Kong and the team in South Shields. And getting that high rate of usage, that 100% adoption, doesn’t eat into a projected ROI. It’s the factor that means it can actually be delivered. A little expenditure at the outset can save a lot in the long term.