The following is a guest article from Matthew Leach, VP of business analysis and project management practice for NTT DATA Services.
Take a moment to consider some of the businesses you frequent in your personal life. How often do you expect them to get the job done right? I'm guessing your answer is something like "almost every time."
For example, would you book a flight on an airline that had a 50% on-time arrival rate? Probably not. Would you continue to eat at a restaurant that overcharged you every other time? Doubtful. How about a surgeon who boasted of keeping one of every two patients alive? I hope you'd consider other options.
In most of our business dealings, we have little tolerance for failure. But what's commonly considered to be an unacceptable success rate in most industries has somehow become the norm for IT projects.
A 2016 study from the Project Management Institute (PMI) revealed that only 50% of IT projects are completed on time; 50% come in within budget; and a meager one in three projects actually accomplish the original project goals.
Such woeful underperformance might have gone unnoticed in the days when IT projects were relegated to the back office, off the radar of executives, employees and customers. But today, technology-driven business models are more common than ever, and digital transformation takes center stage in most organizations' core business models (even those in non-technical industries).
In this world, technology project failures can't be swept under the rug. They become glaringly obvious, damaging the company's performance and credibility. Ironically, the problems that doom IT projects often aren't technical at all.
In fact, PMI has reported that 75% of project failures aren't related to technology. Instead, they can be traced to disconnects within the organization, a lack of business analysis to properly align the IT project with the needs of the company and its customers. Conversely, companies deemed to have mature business analysis capabilities were nearly twice as likely to complete IT projects according to the original targets.
Therein lies good news: By recognizing the value of business analysis in IT, and nurturing that capability in the organization, any company can dramatically improve the success rate of technology projects and the impact they make on the business.
Why projects fail: Building the wrong thing incredibly fast
Before diving into the solution, you first have to understand the problem. And when it comes to the dismal success rate of IT projects, the problem may be counterintuitive. That is, a major reason so many technology projects fail is because they focus too much on technology.
It's typical of IT organizations to want to solve every problem with technical solutions, focusing inside of the IT team itself with calls for more automation, continuous integration and agile software development. They'll spend hundreds or thousands of hours fine-tuning these processes, and the improvements will look impressive on paper — until the final product (whatever it may be) amounts to the equivalent of a box office flop.
Come to find out, the project was ill-conceived from the very beginning. The IT team was missing the bigger picture beyond their corner of the org chart, never realizing they were out of touch with what the business and its customers really needed.
While they managed to develop highly efficient processes and came up with some great technology, one might say they got really good at building the wrong thing incredibly fast.
One memorable example of this type of project failure is Google Glass, the head-mounted optical display released in 2014. On its own, Glass was a stunning piece of technology, but it never gained traction in the market because consumers just weren't ready to make the leap and not enough third-party developers had signed on to offer applications for Glass.
Thousands of similarly ill-fated (if far less visible) projects undermine business performance year after year. As the extreme pressures of digital transformation demand technology teams to deliver against ever-tighter deadlines, these missteps will continue to get worse. That is, until project leaders start making business analysis a prerequisite for every major initiative.
Enabling breakthrough business results
Think of the business analysis function as a liaison between the technology team and the rest of the company (marketing, sales, finance, etc.). The business analyst serves as an interpreter of sorts, to help both sides understand each other's goals and requirements and facilitate an ongoing conversation that keeps everyone moving forward in lockstep.
A good business analyst brings competing priorities, goals and needs into a single description of the solution. With a clear understanding of what the business needs, they can better define the desired outcomes for the project and bring them to fruition on time and within budget.
Equally important, constant alignment between technology and the business allows them to recognize when market conditions necessitate a midstream change of direction and adapt quickly with minimal consequences.
Whatever your organization calls this role (business analysis, project manager, business relationship manager, etc.), the important thing is that it involves more than just checking the "completed" box and moving on once a project wraps up. The business analyst connects the results to the company's overarching goals.
This helps leadership recognize and appreciate the tangible value that IT solutions contribute to business performance. That's especially important as IT executives seek to exert greater influence on the company's long-term strategy and commercial success.
Confusion leads to stagnation
Despite the strong case for better business analysis in technology projects, most organizations have yet to make much progress with it. Of the 730 business analysis professionals surveyed for the PMI report, only 18% deemed their organizations to have "high maturity" in that area of expertise. About 46% said they were just getting started or only performed business analysis on an ad hoc basis.
What's keeping companies from developing this critically important capability? Perhaps the perceived nebulous nature of business analysis is to blame.
Without a clear understanding of the purpose and benefits of the role of the business analyst, companies are less likely to devote the financial and human resources it takes to make an impact. As a result, a significant skill gap exists in most IT organizations, leaving them without the competencies needed to make business analysis (and the business alignment it drives) much more than an afterthought.
On the bright side, because business analysis is still in its infancy in many companies, there's a green-field opportunity to structure it for success in today's growing digital economy.
Devoted agile advocates will likely insist that software should take priority over documentation. But here's the thing: Many people aren't working in software product companies (where agile was born). As agile is scaled to meet the needs of enterprise IT, requirements are front and center.
Today more than ever, technology has a hand in nearly every aspect of the business, making it an integral and visible part of the customer experience. That being the case, business analysts can and should help the technology organization adopt more of an outside-in mindset, thinking less about internal systems and more about how solutions will drive a superior customer experience.
With a consistent and repeatable means to get the requirements right the first time, IT is empowered to produce positive business outcomes that resonate well beyond the scope of any single project success.
It's that type of strategic thinking that will ultimately elevate the status of the IT organization to match the reality of the technology-centric world. IT is no longer just a cost center and internal order-taker; it needs to be a thought leader, business adviser and a center for value creation within the company.
Whether companies choose to build their business analysis capabilities or partner with an experienced consultant, it's time to do more than talk around the issue. Because aligning technology projects with the beating heart of the business is no longer an innovative concept — it's the key to survival in the digital age.