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With the economy on the upswing, business managers look to revive IT projects. It's not always easy.
John Edwards, CFO Magazine
April 1, 2004
In the completely fictional Museum of Business Technology, the displays are amazing. Down one hall they've got a Quadricycle, down another the original Telex. One wing is devoted entirely to computers. There, Hollerith Desks, Apple 1s, and IBM 650s sit perched on ivory cubes, encased in acrylic panels, motionless and muted, forever frozen in time.
Back in the real world, Kim Autrey says he knows a little something about technology behind glass. Three years ago, Autrey, vice president of business systems for Orlando-based CNL Restaurant Capital, a subsidiary of CNL Restaurant Properties Inc., had just developed a bold new tech plan for the company. At the core of the plan: build a data warehouse that would help CNL, a restaurant-industry financing provider, operate more productively and efficiently. The project was well received by Autrey's bosses, who gave it the green light.
But then, in 2002, Autrey's plan abruptly came to a halt. With the restaurant business still in the doldrums, and with other projects at the company being moved up, CNL management decided to suspend the project. "The priorities changed," says Autrey.
Such a rethink is not uncommon. Over the past few years, thousands of corporate IT projects—including those once thought vital to ongoing business success—have been relegated to some high shelf, victims of laggardly revenues and a lingering recession. Tech budgets, ramped up by so many companies during the go-go days of the late 1990s, were reined in. Indeed, Gartner Dataquest says global corporate spending on software and hardware actually dropped from 2001 to 2003—a rare occurrence (see "Once More With Feeling" at the end of this article).
With corporate revenues now improving (and with IT budgets plumped up), a growing number of companies are looking to revisit old proposals. Some are finding, however, that jump-starting a stalled project can be a complicated affair. "You can't just gas and go," says Rick Brenner, a principal at Chaco Canyon Consulting, a Boston-based company that provides project-consulting services. "You can almost never resume a project from where you left off."
Consultants often advise corporate clients to appoint a team leader to assess the difficult work ahead. "You need one person who can conduct a project triage," asserts Troy Edgar, CEO of Global Conductor, a Los Alamitos, Calif.-based management consulting firm that helps large companies implement and integrate projects. "This person can then lead a group of people to finding the right answers."
It's not surprising that a worker with experience restarting stalled projects makes the best choice for the job. "You may find someone like this inside," says Brenner, "but it's unlikely." Why? Some industry watchers point out that tech workers with good project skills often command high salaries—exactly the kind of salaries employers have been eager to dump in recent years.
Occasionally, businesses turn to project-consulting firms to revive old initiatives. Many companies, though, eventually hand the keys back to the employee who first ran the program. A smart move, particularly if the worker has continued to champion the project during the big sleep. At CNL, Autrey says he never lost faith in his data-warehouse proposal. "I didn't want to let it die," he says frankly.
The result? As soon as CNL's business picked up, Autrey's project was sitting at the top of the corporate to-do list. "The homework was done," recalls Autrey. "So when we were ready to pull the trigger, we could pull it and move quickly."
Often, the first action after pulling the trigger is reassembling the original project team. That's no small task, given the high turnover in many IT departments. Plus, funds are almost always reallocated following a project cancellation. But many restarted projects can move forward with just a core of former participants, claims Ian Campbell, CEO of Nucleus Research, an IT research and project deployment consulting firm in Wellesley, Mass. "In most cases, it's just the evangelist and one or two of the former team members."
That proved to be the case at CNL. When the "go" signal arrived late last year, Autrey moved quickly to reassemble the project team. "It wasn't a large group at that point—three or four people," he says. "But we brought them back together."
Some companies may have a tougher time reassembling the old crew. Experts point out that team members, burned by the initial postponement of a project, could be reluctant to return. That's particularly true if the workers have moved on to other successful ventures at a company. "People generally blame management when things go wrong," observes Brenner, "although most companies don't acknowledge this fact."
To rebuild trust, a company's management needs to be honest with team members about why a project was yanked. More important, say consultants, executives overseeing the revived project—whether IT managers, CFOs, or other finance executives—should set a time line that minimizes the chances of another delay. "It's never a good idea to spend a long time deploying something," says Campbell. "It's far better to have 80 percent functionality—going back to work on the details later—than to make sure everything is 100 percent up front."
In truth, some on-hold projects may not offer the benefits they once did. Technology projects have a notoriously short shelf life, and experts warn that there is a big difference between restarting a project that has been shelved for a couple of months and one that has been moldering since the 20th century. Notes Brian S. Sommer, vice president of field research services at Aberdeen Group, a Boston-based technology research firm: "If it's been more than 18 to 24 months, you need to look at the business case behind the project."
A close examination may reveal serious flaws. For starters, the technology driving the project will likely have changed in the intervening years. Autrey says he had to reexamine the providers in the data-warehousing space before relaunching his project. "Not only their products, but the leadership," he notes. "What happened to them during the one-and-a-half, two-year period?"
Beyond checking for new and enhanced technologies, a company's management also needs to look at business options that may have emerged since a project last saw light. "Perhaps you can ship some of [the project] offshore," notes Sommer. "This wouldn't have been an option until recently."
In some cases, it may make more sense financially to simply start from scratch rather than attempt to resuscitate an old plan. Other times, the rationale for a project may simply no longer exist. A downsized company, for instance, may no longer require the elaborate networking strategy that was devised a few years back. Reaching that conclusion, while painful, could prevent some ugliness down the road. "Restarting a project can be very expensive," warns Sommer. "Sometimes it's better to kill a bad project than to continue on."
John Edwards is a freelance writer based in Gilbert, Arizona.
|Once More with Feeling|
Worldwide IT spending (in $billions) is primed for a rebound.
|All IT spending*||2,187||2,192||2,302||2,421||2,541||2,666|
|*Figures may not add up to total, due to rounding.|
Source: Gartner Dataquest (December 2003)