Companies Don't Learn From Previous IT Snafus

Computer projects have failed for as long as there have been computers. But now that most companies are only as stable as their bits and bytes, the consequences of information technology screwups aren't easily disguised -- they show up in earnings reports.

When IT goes bad, high-growth rocket ships like Oxford Health Plans Inc. and Ben & Jerry's Homemade Inc. report their first-ever financial losses. Others crater and run for bankruptcy protection, as did drug distribution giant FoxMeyer Corp.

In a Computerworld study of multimillion-dollar IT disasters, the following two not-so-surprising themes emerged:

• User companies like FoxMeyer often file tough-to-win lawsuits against the vendors or consultants involved. Nonetheless, collectively, users rarely seem to learn much from the episodes or apply the lessons to future projects.

• All of the botched projects in Computerworld's Top 10 disasters list were big and richly complex; many were the toughest IT projects the users had ever tried. Five were hideously difficult enterprise resources planning (ERP) system implementations.

Root Causes Remain the Same

The root causes of IT failures haven't changed a bit over the years.

Miscommunication, hazy goals, "scope creep," inept leadership, pitiful project management -- you've heard, if not heeded, it all before.

"We may be neck-deep in the New Economy and Internet time, but you still have the same factors and the same failings," said Bruce Webster, a director at PricewaterhouseCoopers in Washington.

Webster recently studied 120 IT lawsuits filed since 1976, and he said he's convinced that most flops could be avoided if people simply knew the time-honored best practices of systems development.

"I don't know how many IT managers, team leaders, directors and CIOs have actually sat down and read The Mythical Man-Month, The Psychology of Computer Programming and Death March," he said, referring to three books that amount to the software development canon. "The causes of disasters are all well documented. They're fundamental."

Still, warning lights are easy to overlook when the whole room is spinning.

"There's a natural tendency to get overly committed to something, especially when there are no clear signals telling you you are off course," said Mark Keil, an associate professor at Georgia State University in Atlanta.

The infamously buggy baggage-handling system at the Denver International Airport is one case that offered unambiguous proof of technology glitches: shredded luggage.

But tests of most questionable IT projects don't yield such graphic evidence.

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