What are the major causes of information systems failures? What strategies can organisations take to face the challenges and ensure the success?
An information system project according to Ewusi-Mensah (1997) is “any information technology project intended to meet the information processing need of an organization”. In Critical issues in abandoned information system projects, Ewusi-Mensah(1997) stated that information system projects implementation requires collaboration of Information system staff that deploys and educate on the use of the software to drive the project, end users and management. “It is a group-oriented activity organized and executed in teams and therefore subject to the unpredictability of group dynamics, interactions, coordination, and communication” ( Ewusi-Mensah ,1997).
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An information system is a set of elements (people, data, and procedures) working together to provide useful information (Senn, 1990, p8). Also, information system (IS) is any set of information technology and people’s activities using that technology to backup operations, management, and decision-making (SEI Report, “Glossary” ). In a wider sense, the word information system is often used to refer to the relationship between people, algorithmic processes, data and technology. Therefore, the term is used to refer not only to the information and communication technology (ICT) an organization uses, but also to the way in which people interact with this technology in support of business processes (Kroenke, D. M. 2008). An information system consists of computers, instructions, stored facts, people and procedures.
A systems failure occurs when a system does not meet its requirements or when the level of discontentment with a system increases to the level that there is no enough provision to sustain it. Information system project failure may be as a result of its inability to meet users’ requirements and/or overruns pertaining to budget or completion time (Yeo, K. T. 2002). Studies have shown that many failed projects are over budget, some by as much as 189%. May, L (1998) in “Major causes of software failure” stated that only one-sixth (16.67%) of projects are finished as schedule and within budget. An information system failure can bring about financial loss, commercial embarrassment, loss of clients and revenue streams, regulatory fines or sanctions and the loss of staff morale or stakeholder allegiance within an organization. Examples of system failures includes a laser failing to designate its target, an alarm system that fails to sound when pressed, an automated door that fails to open and close on its own accord on approach, ammunition that detonates prematurely, and other similar conditions.
This article discusses the causes of information system project failures and strategies organizations can take to face the challenges and ensure success.
The Standish group (1995) in (Yeo, K. T. 2002) classified project outcome as Type 1, Type 2 and Type 3. According to the group, 16.2%,52.7% and 31.1% of projects fall into Types 1,2 and 3 classes respectively.
A “successful project” classified as the Type 1 projects are those that were successfully implemented within the stated time and budget with all required features and functionality specified. The “challenged” projects classified as the Type 2 projects are those that “suffer budget overruns and/ or program slips thereby failing to completely achieve its goal even though they are completed and operational while Type 3 project classified as the “Impaired” projects are those cancelled or abandoned at some point during the development cycle” The Standish group (1995) in (Yeo, K. T. 2002). Technical failure may not necessarily be the cause of project impairment, lack of adoption of a technically faultless Information system project by end users or corporate management consequently resulting in its lack of use or underutilization denotes failure (Yeo, K. T. 2002). From this view point, Information system is said to be a socio-technical system. Land and Hirschheim (1983) described an information system as “a social system that uses information technology”. This can be explained in the sense that as a technical system, a system that fails in an organization can be successfully implemented in another organization while as a social system an Information system can be successfully implemented in an organization while the implementation of another information system can result in failure (Davies G. B. et al, 1992).
Information System as a type of socio-technical system
The mediating concept between actions and technology is refer to as information systems.(Beynon-Davies P. 2009). The technical system dimension consists of both operational and functional features. The operational features apply to the technology(effectiveness of the hardware or software as well as the friendliness of the technology’s user interfaces) while the functional features relate to the performance relative to expected functionality .
Technology as a component of the technical system refers to hardware, software and other related technology. This pertains to the functionality of the system, whether it is up or down when a person needs to use it.
User interfaces refers to the link between the human user and the software/hardware technology (input screens, output screens, paper input forms and paper output reports). Error rates in the transfer of data from one medium to another and the time that users require to become familiar with the system all constitute indicators of performance of the implemented system while Information requirements as a technical system component refers to the ability of the Information system implemented to give new capabilities than the one being replaced. Careful study of the organization to know its information need is essential ( Davies G. B. et al).
The social system refers to the features of organizational setting which exist in an organization even as people enter and leave the organization.
The components of this system include; acceptance/rejection of the technical system, theories in use, measures of performance to expectation and the developmental process of the system. Rejection or underutilization may be based on the premise that the introduction of new technology is instrumental to deskilling or job loss (Davies G. B. et al, 1992).
Characteristic features of Information system project
Information system projects are capital and labour intensive usually requiring a huge sum of money to implement. Its failure can cause a huge financial loss to an organization and therefore there is need for adequate planning before its implementation to ensure that desired expectations are met.
An information system is a type of socio-technical system which is critical to the survival and well-being of companies. As a result, the right technology must be deployed and the end users educated on its use and benefits.
Also, Brooks in Ewusi-Mensah (1997) stated that “IS projects are conceptual in nature” (i.e. “it is pure thought stuff which is invisible and unvisualizable”).
In addition, there are certain risks and uncertainties such as large project size, unfamiliarity with the new technology and unstable information requirements associated with projects that are difficult to assess prior to the start of the project.
IS projects as stated earlier are group oriented requiring members from different backgrounds and therefore require a high degree of coordination and clear lines of communication to ensure success Ewusi-Mensah (1997).
Reasons for Information System implementation
To increase productivity in order to maintain competitive advantage
To enhance business operations through the re-engineering of an organisation’s processes
Changes in activities of an organisation or in the nature of the organisation.
Technological Changes can lead to new production processes or using alternative materials in the manufacturing process
Classification of system failures
There are four major categories of Information system failure according to Lyytinen and Hirschheim (1987). The categories are as follows;
Process failure: “this occurs when an Information system project cannot be developed within an allocated budget and/or time schedule”. The project development results in overspending in both cost and time.
Correspondence failure: this occurs when the objectives and goals of the systems design are not met.
Interaction failure: this is attributed to the level of end-user usage or adoption or acceptance of the implemented information system. User attitudes, data packets, user satisfaction and the degree of adoption are measures of usage of information system usage.
Expectation failure: this is the inability of a system to meet its stakeholders’ requirement, expectations or values
Another classification of failures according to Ben Meadowcroft in “Why Systems fail” is;
Poor development practices: these type of are failures brought about by error in the software development and it includes;
Poor testing of program,
Making incorrect assumptions as to the requirements of the system,
Providing poor or insufficient documentation,
Poor user interface.
End user or entity problems: These are failures caused mainly by errors on the part of either the end user or the entity that are using/requesting the system and they include;
Providing incorrect specification for the system,
Entering erroneous data,
Not providing training for the end user.
Implementation or hardware errors: These failures are those that are mainly caused by hardware faults or by the entity not having the resources necessary to make the specified system usable and they include
Badly designed hardware,
A poor fit between the system and the organisation.
Majors causes of information systems failure
Unclear goals: lack of well defined project goals and objectives which is key to the success of any IS project development. There is also need to state clearly the information need of an organization and also the adoption process before attempting to introduce an information system(Lucas in Davies G. B. et al 1992)
Improper reporting structure/Miscommunication: since the development of large IS projects is the work of a team drawn from diverse groups of people with responsibilities to ensure the project’s success which includes IS staff, end users and senior management, there is need for the establishment of clear lines of communication and well defined lines of authority and responsibility among team members. Communication in project teams is “essential to sort out dispute concerning requirements of design decisions among project members” (Curtis et al 1988).
Inept/incompetent leadership: Poor management of the project and lack of good leadership responsible for coordination and control, measurement of progress and making of vital decisions at different phases of the project.
Poor technology base or infrastructure: lack of adequate technological base needed for successful implementation of the kind of systems development being considered. According to Land in G. B. Davis et al, the distance between the existing system and the replacement system is essential for the success of an information system.
Poor project management: this has to do with inadequate measurement system to measure progress and equally identify potential risks in time to mitigate them.
Lack of technical competence: the technological know-how of information systems staff is very vital to the success of IS projects as lack of familiarity with an information technology new to the IS staff is contributory to IS project failure. If a user is improperly trained then the likelihood of them making major errors is increased due to their lack of knowledge of the system. Failures by reason of lack of training should not be regarded as an error due to the individual operator as is likely with a poorly designed user interface, but as a mistake by the management.
Scope creep: projects excessively grand in scope usually have higher risks and higher complexities and therefore more prone to failure. Scope is the initial “blueprint” of an implementation plan.
Faulty hardware faulty hardware can bring about serious system failure. This factor is then again an essential one that should be given due consideration together with the more common software errors. Faulty hardware should be taken into thought when designing the systems in order to try and reduce the impact of the failure. Hardware failure is not as likely to occur as software faults but can be as damaging.
Poor selection decision of project team members: the project team composition is also vital for the success of the information system project.
Strategies organisations can take to ensure success of information system projects.
Firstly, to ensure success of information system projects there is need for a clear and well defined IS goal. Every member of the IS project management team as well as stakeholders should know the specific information requirement of the organization as well as how to go about satisfying it. This is important to guide the information requirements phase of the development process. Failure in this area will lead to fragmented efforts and lack of focus in assembling facts to guide the rest of the development (Curtis et al 1988).
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Secondly, the selection of competent and qualified staff to serve as members of IS project team is very vital for successful project implementation (Brooks, 1981). Team members should be those with real prior experience and who are equally familiar with the technology being deployed. Improved training of the end users will significantly reduce system failures and improve the integrity of data stored on the computer systems. The project team should consist of the most successful people of the organization (Nah et al, 2001). Lockheed Martin, a leading aeronautical group, stated that one of its keys to success was “assembling a team capable of making and executing” changes required (Stedman, 1999)
Also, the imposition of structure on the developmental effort of the project helps to guide it to successful completion. It involves the division of the project into phases which helps the project team realize what deliverables for each stage are and to know if they have been satisfied.
It is also important that clear lines of communication be established within the team, with lines of authority and responsibilities of the team members clearly stated. This is important since the team members are drawn from diverse units.
Selection of competent leaders who will ensure that proper management and control practices are adhered to and enforced in the implementation process of an Information system is vital. Adequate safeguards and oversight by management is necessary to ensure technical personnel’s compliance with accepted industry standards for reporting and dealing with problems uncovered in any phase of system development. The leader should be one with both application-domain knowledge and software knowledge.
There should also be regular periodic meetings to discuss the systems development effort. A successful implementation of a project is only attainable when high-level executives possess a strong commitment to the project (Davenport, 2000). Senior executives at Farmland Industries demonstrated its support to project team members by providing bonuses to employees and consultants.
The technological infrastructure available in a company needs to be critically assessed to determine it is adequate to support the kind of system development that is to be implemented. Care should be taken not to embark on IS project development until the senior executives are fully satisfied that the company’s technological base is adequate. Assurance from the Management Information System management should be taken to reduce the risk s and uncertainties associated with system development works.
There is need for the maintenance of scope. The ability to maintain scope is related to planning and this is attainable for companies both small and large. Geishecker (1999) stated that Colgate-Palmolive Company itemised scope maintenance as a contributory factor to their success. The roll out approach for the implementation of the information system project is a very important consideration under scope maintenance. There are two approaches namely the “big bang” approach and the gradual (phased) rollout approach. Both approaches have their prons and cons. Oil giant Chevron attributes a phased roll out to the successful implementation of an information system project. Home Depot has also successfully implemented several modules of an Information system using the phased roll out approach (Mearian, 2000). Phased roll-out approach though more expensive and usually taking longer time, offer reduced business risk (Davenport, 2000).
Internal readiness/training is also vital for the successful implementation of an information system project. The most common failure factor recorded was that of “readiness for change”. All employees must be trained on the new system in order to use it to continue day to day operations. Also managers must understand the implication of the system and the changes it will cause. If managers are not in agreement or cooperation, then there will be no “eagerness” or buy-in and there may even be active resistance (Davenport, 2000).
Planning/development /budgeting are necessary for the success of an information system project. Planning should be intimately identified with maintaining scope during an implementation. Ineffective planning results in cost overruns and development delays. Home Depot, Lockerheed Martin and Mead Corporation are examples of companies attributing success to planning. As stated earlier, many projects especially failed ones are over budget, some as much as 189 percent.
Adequate testing of the system is a key element for the successful implementation of the system. It is reported that Gillette Company withstood five months of severe testing procedures before their successful go-live date (CIO, 2000). Also, Eastman Kodak was able to complete what at the time was the largest implementation on record as a result of testing (PR Newswire, 2001). Whirlpool Corporation attributes inadequate testing as its single reason for unsuccessful and costly implementation. The company gambled on its testing program by cutting down the amount of time needed in an effort to avoid the wrath of Senior Executives.
The goal of this was to identify the major causes of information systems failures and strategies organisations can take to face the challenges and ensure the success? Towards this goal different articles and journals were examine. The project team compostion, management support , internal readiness of the employees, existence of technolgical infrastructure able to support and sustain the new system to be implemented, well defined goals which is in line with the organization’s goal, adquately tested system, clear and well defined reporting structure and good leadership are all vital ingredients to ensure the successful implementation as well as utilization of a newly deployed information system. It is to be noted that even though a system technically faultless, underutilization as a result of lack of full acceptance or understanding of how to adopt the information system for day to day operation amounts to failure of the information system. For this reason, the management must enlighten the users of the deployed information system on the need for the change as well as attached benefits.
Finally, though appropraite measures should be put in place to prevent failure of the information system project, they may still occur; but when they occur, a system failure analysis which is an investigation to determine the underlying reasons for the nonconformance to the system requirement in order to identify the causes of nonconformance equally recommend appropraite correction measures. This is because failure could have benefits expecially in relation to learning.
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Beynon-Davies P. (2009). The ‘language’ of informatics: the nature of information systems. International Journal of Information Management. 29(2). 92-103
CIO (2000), “Does ERP build a better business?”, 15 February, pp. 114-24.
Davenport, T. (2000), Mission Critical – Realizing the Promise of Enterprise Systems, Harvard Business School Publishing, Boston, MA.
Geishecker, L. (1999), “ERP vs best of breed”, Strategic Management, March, pp. 63-6.
Land, F. and Hirschheim, R. “Participative Systems Design: Rationale, Tools and Techniques”, Journal of Applied Systems Analysis, Vol. 10, 1983.
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The Standish Group. The CHAOS Report (1995), 1995. http://www.standishgroup.com/chaos.html.
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