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Why do Software Projects Fail?

Even after utilizing the collective software development experience of hundreds of software companies and software experts over the years, across the globe, a large chunk of "software projects still fail big time". So the big question is - why does a software project fail, if at all?

In the early years of IT incubation into applied services, it was understandable, but now with so many supportive tools, truckloads of experience and resources the results are still saddening. In order to ensure that your critical software project sees the light of the day, it's very important to know the reasons that lead of software project failure in the first place, and 10 ways in which you can avoid failure of your IT project.

Software Project Management Statistics to Ponder

Resolution of large software projects

As per the recent study, an incredible 70% of organizations have suffered at least one project failure in the prior 12 months, and 50% of the respondents indicated that their large software projects failed to consistently achieve the objectives they had set out in the beginning.

Being able to identify the causes of failure and categorizing them can lead to lower failure rates in future endeavors. Here's how we have classified Software projects based on their performance.

  • Successful software projects are on time, on budget, and have a satisfactory implementation
  • Challenged Software projects are over budget, late, and/or have an unsatisfactory implementation
  • Failed software projects are the ones that were either canceled prior to completion or discarded after implementation

10 Reasons that Lead to Software Project Failure

The possibility of software projects failing can be attributed to various reasons - costs, scheduling and quality issues, and/ or achievement of objectives. This pose a serious threat to companies wishing to outsource their software development needs, as software project management failures often cause huge losses in time and money, and can prove to be detrimental to a company's growth and development.

Let's look at 10 key reasons that lead to failure of large software projects / IT projects -

1. Miscalculated Time and Budget Frames

Clients are always eager to have their projects rolled-out on time and even before the stipulated time at throw away prices. In most cases, this keenness of the client leads to developers agreeing to a rather shorter or unrealistic and non-negotiable time frame for the project delivery at meager rates. As a result, programmers are not able to deliver the project on time, but being pushed to the wall under cumbersome expectations to ensure faster rollouts, software experts focus more on coding and less on designing, compromising user experience and usability in return.

- As per the report by a leading MNC, only 40% of the software projects meet schedule, budget and quality goals.

2. Was it Needed At All?

This is rather a surprising reason which attributes to a software project failure, primarily in low-consensus and non-evaluative organizations that lack in leadership. A classic example as depicted in a report by a leading Consulting firm shows how resource-gulping these projects could be.

- The FAA Advanced Automation System (1981-1994) : Cost of $3.7 billion; peak staffing of 2000; maximum run rate of $1 million/day; 17 years duration of development

- Nothing was delivered; no code was ever used. The reason: nobody wanted it in the first place or in other words there was no business case for it

3. Lack of Communication

Another key aspect is the failure to set up effective communication channels and participative environment. Due to this, ideas or process flows get adrift and leads to lack of previews and interactions between the active project promoters and developers. At times standardized assumptions during communication may lead to misunderstanding as standards may vary from industry to industry leading to business software failure.

4. No End-user Involvement

If the user's point of view is not taken into consideration while developing the IT project you are definitely calling in for trouble. So failure to find and engage the right users to participate in the software development process is extremely disastrous.

- As per the Standish Group, it was the lack of user involvement that caused the large-scale federal government project to fail. The group also says that user involvement is 23% of the true cost of a project.

5. Unfocused Executive Sponsors

Inactive leadership through non-effective executive sponsors is why IT projects fail. They are the people who keep the process ignited and are primarily responsible for the success or failure of the project. So in most cases lack of time spent by these executive sponsors or the complete lack of it, leads to project failures.

6. Failing to See the Bigger Picture

This is a classic example of a failed project, which failed to see the big picture ahead. You can downsize this to even smaller projects, where lack of foresight or stakeholders confidence is in question.

- In UK, officials called off what was considered to be the largest public IT project of all time. It was a project which was intended to provide electronic health records for all of its citizens. After 10 years and costing an estimated around 19 billion USD the authorities concluded that the project was not fit to provide the modern services it was intended to.

In hindsight this also tells us the importance of reviewing failure of a software project before starting a new project.

7. Chasing Technology

Some managers are lured into the benefits of the latest available technology, and try to use it for their ongoing projects. This forces them to gravitate from the planning done at the design stage. This leads to the failure of the whole system, change in objectives, or failing to complete the project on time. Moreover, these latest technologies may not even be mature or robust enough to have been used in the first place.

8. Development Downtime

Causes of downtimeDevelopment downtime is one of the primary contributors to challenged or failed projects. Major factors that lead to software project failure are - application bug or error, environmental factors, infrastructure or software failure, virus, hacker, network/hardware failure and operator error.

The chart shows application bugs to be the leading cause of downtime apart from other factors.

9. Lack of Periodic Assessment

Lack of client induced and developer mandated assessments, and failure in smartly establishing milestone points leads to improper assessments, which leads to irreparable or catastrophic failures.

10. Lack of Quality Testing

In most projects, the importance given to coding isn't given to testing. Honestly speaking testing calls for a greater integrity and role in the entire software development lifecycle. Casual testing, testing under non-real time environments contribute to testing failures. Bolder companies test their projects under live production environments in order to service disasters.

Outsource to India for Effective Execution of Your Software Project

At Outsource2india, we have a team of highly skilled and experienced software professionals, with expertise across multiple domains. Vast on job experience has helped our team understand and figure out the reasons that may lead to the failure of a software project. Also, they are aware of the ways in which the project failure can be avoided. Read our well researched article on 10 ways to avoid project failure to know more.

Contact our software team to know how we can help you effectively avoid software project failures and ensure successful delivery and execution of your cherished long-term software project.

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