Project Management and SDLC

30 Sep No Comments

Project Management and SDLC (20 points) 

The purpose of project management and the SDLC is to increase successful software implementation. The article titled “IT Project Failure Rates: Facts and Reasons” makes it clear that a lot of projects still fail.

o Identify an IT system development failure that occurred within the last 2 years. Do not repeat an example from earlier in the course or one that has been posted by another student. 

o In your initial post this week, analyze which project management concepts were not respected by the project managers and where in the SDLC these lapses occurred.

o Describe how you might have spoken up had you been on the steering committee.

A massive drug wholesaler failed large implementation of ERP:

In the early 90s, FoxMeyer, a healthcare service company, was the fifth largest drug wholesaler in the United States, with $5 billion in annual sales and around 500,000 items shipped daily.

Because of fierce competition, FoxMeyer needed a solution that would make complex supply chain decisions while facing the cost pressure. FoxMeyer decided that an ERP would offer the best solution to get real-time information, automate, and integrate inventory systems into a unique system. The company expected to eliminate unnecessary or redundant activities, set up appropriate inventory levels, and implement more responsive customer services.

This IT system, a multi-million dollar project, was the first of its kind launched in the pharmaceutical industry. The implementation cost for SAP budgeted at $65 million and the ERP system was projected to save FoxMeyer about $40 million per year.

The budget included:

•    $4.8 million client/server computer system from HP

•    $4 million for the software

•    Several millions of dollars for consulting fees

•    $18 million for a new 340,000-square-foot computerized warehouse

This failure was the result of poor planning and implementation.

Planning:

1.    Poor selection of the ERP

2.    No consideration of other consultants’ advice

3.    Lack of contingency planning

4.    No end user involvement

Implementation:

1.    No restructuring of the business process

2.    Insufficient testing

3.    Overly ambitious project scope

4.    Dominance of IT specialists’ interest

5.    Poor management support

6.    Lack of end-user cooperation

Unfortunately for FoxMeyer, the project was a total disaster with a final bill of $100 million for the implementation of the ERP. FoxMeyer only saved half of the projected amount, and the company had to file for bankruptcy a few months later.

HOW TO ACHIEVE LARGE-SCALE PROJECT SUCCESS

Because the ultimate goal is to improve the success rate of large-scale projects substantially, the best place to begin is in the initial phases of project planning. The following is an approach to starting massive plans that ensure that essential functions will address and that cultural impediments will be identified and countered. Primary emphasis placed on the approach’s initial two steps—project scoping and planning, and assessing culture and values—as they have the more significant impact on project success. These two steps should perform concurrently. Also included is a brief discussion of other necessary measures that will facilitate successful large-scale project management.

Step 1: Project Scoping and Planning

Begin by scoping the project. Any of a dozen or so full lifecycle methodologies may be used to adequately scope and plan a large-scale project. As all proper methods dictate, the scope should be defined up-front as thoroughly as possible to ensure that all constituencies understand and agree to what undertaken.

Scoping should include a discussion of:

• Business functions

• Tangible and intangible benefits sought

• Organizational areas affected

• Major problems to be addressed

• Major issues to be resolved during the project

• Systems to be replaced

• Technology goals and an outline of the target solution.

Step 2: Culture and Values Assessment

Successful businesses tend to have organizational cultures that are strategically appropriate and adaptable to change.4 Given the amount of change introduced both by the existence of a large project team and the implementation of large-scale change, this is likely also true for successful large-scale projects. For large-scale projects, every effort should be made to ensure that the organization’s culture is compatible with the magnitude of change introduced.

The second step, therefore, involves conducting a culture and values assessment of all sponsoring and affected business units, as well as of the IS organization.5 The goal of the assessment is to gauge the organization’s current culture and its fit with the change to be introduced by both the new project and the implementation of its solution. Due to the sensitive nature of such an activity, and the potential for bias, it will likely be necessary to use an objective third party to conduct this assessment.

The end products of the assessment should include the following:

• Identification and analysis of the pervasive cultures and values in the organization;

• Analysis of the characteristics of cultures and values that are appropriate for successful implementation of the level of change to be encountered during and after the project;

• Outline of a change management plan to gradually move the organization toward behaviors consistent with the changes to be introduced by the successful large-scale projects.




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