Every IT executive struggles with the implementation of large-scale IT projects. Studies consistently show that two out of three large programmes regularly fail to meet the original budget, miss the schedule and fall short of user goals and expectations after a long period of implementation. Often by a multiple.
These lapses are particularly detrimental to companies, as large programmes are usually of critical importance. Whether it is a global consolidation of ERP systems, the system-wide harmonisation of operational processes, or the merging of financial data across locations.
A number of new methodologies and tools that have emerged in recent years can significantly improve the implementation of large programmes. Combined with disciplined and experienced project management, the success rates of complex large-scale technology projects can be significantly increased.
We’ll show you how.
We show you below how programme management can be supported with the help of modern and partly digital applications.
Using agile methods
Even companies that are committed to agile development often resist using agile methods for large programmes. This is not about black and white thinking, either agile or not, but rather using the advantageous components of agile management for themselves. From our experience, these are:
- Clear product responsibility
.
- Prioritised product backlog
- Roadmaps based on sprints
.
- Small cross-functional teams
- Iterative releases with timebox sprints
- Modular architecture
- Use of Objectives and Key Results (OKRs)
- Minimal Viable Products (MVP) as the first major milestone
.
An agile mindset also encourages project staff to work more closely together, to break down possible silo thinking, to react more quickly to change, and to keep testing and learning.
The use of agile methods in large-scale projects also brings some advantages. The conversion of programmes that have already been running for some time to agile development also pays off – despite the late timing of the conversion:
- Faster to visible results
.
- Lower frustration among users
.
- Fewer errors in the system
.
- Better collaboration between different providers
.
- Inclusion of smaller development companies instead of a large system integrator
.
- Increased productivity
- Higher delivery speeds
Using design thinking
.
Many large programmes meet functional requirements but not the true needs of users. To meet the users’ requirements, design thinking comes into play. This is a method of problem solving that helps deliver products and features that users want and need and are therefore more likely to use. Another benefit is savings, as teams only develop the features that are really needed.
For large programmes, design thinking starts with identifying user requirements, through a mix of quantitative survey and qualitative research. This gives a clear picture of how users want to use the product, what their experience has been so far and what needs have not been met so far. It would be a mistake in a long-running programme to see this as a one-off. Rather, it needs regular and intensive user involvement throughout the programme’s life, for example in the creation of prototypes and in user tests. The comparison with the traditional approach should make clear how design thinking can work.
In the traditional approach, the user would be involved in the design process.
In the traditional approach, one would start with the collection of requirements from R&D, production, sales and customer service. This collection is often done in isolation from each other and then recorded in a requirements and specifications document. This is usually so complex that a review by the technical department more or less follows.
In contrast, within the framework of design thinking principles, cross-functional workshops and interviews take place to collect current problems and requirements together. Today, the use of a “digital twin” (Digital Twins) can be helpful. This is a digital simulation of a process on the computer. This makes it easier for those involved to identify problems and necessary interactions. This leads to an early exchange of information between the departments concerned, users, suppliers, providers and developers. On the one hand, an understanding of the true requirements is created for all, and on the other hand, the basis is laid for close and successful further cooperation during the course of the programme. This approach also speeds up the release of functions and facilitates the prioritisation of requirements in the product backlog by the product owner.
Cloud-based services
.
Many executives tend to reduce the benefits of the cloud to efficiencies in infrastructure management. However, the possibilities inherent in cloud services can also be seen when applied to complex large-scale projects. The features offered by many cloud service providers give programme managers flexibility in deploying different environments. Cloud solutions make it possible to scale development environments within a short period of time, allowing prototyping or testing of novel solutions in a short period of time. The creation of project reports, which is usually resource- and time-intensive, can also be done much faster with the help of the cloud.
On the software development side, using a Platform-as-a-Service (PaaS) solution can significantly increase productivity and provide access to thousands of innovative services.
But it is not only during project realisation that the cloud can be used sensibly; even when determining the basic solution architecture, numerous cloud services now open up new options. Opting for a software-as-a-service (SaaS) solution, for example, can avoid the effort of custom development and lead to an equivalent solution that is also easier to maintain.
More flexible through microservices and modular components
.
Many companies are moving to more modular, flexible architectures that allow for the inclusion of microservices, for example. This move allows companies to rely on multiple vendors in a programme, reducing dependence on just one major implementation partner. This also solves one of the biggest problems in managing large programmes: with single-vendor solutions, it is almost impossible to exert constant cost pressure, as fixed-price contracts often include a significant risk premium and change orders are common. On the other hand, time-and-material contracts create incentives for providers to extend or expand programmes and thus increase their revenue streams.
Modular architectures, on the one hand, allow clients to collaborate with multiple providers as mentioned, and on the other hand, individual providers can be replaced as needed. If several development companies work together in the programme, they can either compete against each other in each project phase or each receive smaller work packages (microservices), e.g. front-end designs or development and testing services. As the programme progresses, the best-performing providers – who bring in consistently competent staff at a reasonable cost – can then win the contract for a larger portion of the work.
Conclusion
.
Large-scale IT projects continue to pose immense challenges to corporate executives. Their implementation has a significant impact on company operations. Not least, such programmes require massive budgets over several years, tie up a large number of employees in the company and are crucial for the careers of many executives involved in the project. Whether such programmes are successful certainly depends to a large extent on the leadership qualities of the people involved. In recent years, however, new approaches have been developed and technical possibilities have been added that project managers can access. Those who use these possibilities and apply them to their programme significantly increase the likelihood of success of complex projects. The best thing to do is to discuss with the project managers at Arentzen & Partner the extent to which the approaches presented could also benefit you and your project. Contact us!
Images used:
Computer photo created by standret – www.freepik.com
IT strategy development in times of New Work
/by Christian ArentzenModern IT strategy development looks different today than it did 10 or 20 years ago. Not long ago, and strategic thinking was usually the exclusive preserve of senior IT management. Sometimes management consultancies were also tasked with shaping the future of IT. The latter often led to acceptance problems and slow implementation. With a much more participatory approach, a new path of modern IT strategy development is being taken here. The new approach is described in more detail below. The main changes and advantages compared to the classic approach are pointed out. And finally, there are some practical tips on how to apply it.
Der Open Strategy Ansatz als Grundlage
Die partizipative IT-Strategieentwicklung greift den Ansatz von Open Strategy auf. This has been developed over the past 2 years by professors and consultants Christian Stadler, Julia Hautz, Kurt Matzler and Stephan Friedrich von den Eichen (see also link).
Basically, it is about opening up the strategy process by involving both their own staff and external third parties in strategy development and formulation. Instead of developing strategies only within management and consulting circles, they deliberately force access to other sources of knowledge. For example, the involvement of frontline employees, customers, partners and suppliers. While competitive criticality is an inhibiting factor in corporate strategy, this is only partly true for IT strategy development. Nevertheless, it can be seen that IT strategies are mostly developed by IT executives, who often have access to well-known IT consultancies. Die Durchführung von gemeinsamen und regelmäßigen Strategie-Workshops mit Mitarbeiter*innen aus den unternehmenseigenen Geschäftsbereichen, als auch bestehenden Dienstleistern und Partnern wird noch viel zu wenig genutzt. Within the IT department alone, the IT specialists should be involved at an early stage, in addition to the managers.
The advantages of participative IT strategy development
Die Weisheit der vielen
IT strategy development should not be limited to a small circle of top managers or external consultants. The more intensively business units, service providers and employees* are involved, the more diverse the approaches and ideas. And this principle already applies to the analysis. The frequent mention of strengths, weaknesses, opportunities or risks indicate a high degree of relevance. Even if one or the other manager does not always like to see or hear this. However, managers do well to increase the probability of success of an IT strategy with the help of collective intelligence. Auch bestehende IT-Dienstleister können dazu beitragen. They should, however, take off their sales glasses and analyse the customer situation without reservations. If the users from the business units are considered internal customers of IT, it is important to communicate openly that your arguments will flow in without claiming to be able to take everything into account.
Diversity instead of narrow-mindedness or the dilemma with confirmation bias
If IT strategy development is carried out by a few, the results can quickly go in one direction. Thus, (departmental) self-interests usually stand in the way of a promising joint IT strategy. This behaviour can be traced back to the so-called confirmation bias. Employees in leadership positions see their own convictions confirmed by others. In this way, they selectively choose information that fits their own perception.
But new strategic directions are based on courage and thinking outside of familiar patterns.
Both external people, but also the users in the specialist departments, as well as the company’s own IT specialists who are operationally involved, are valuable suppliers of new ideas or approaches. Employees who are new to the company can also often contribute unbiased ideas, even if they do not come from IT.
A greater willingness to implement or avoid “not-invented-by-us” thinking
A major advantage of participatory IT strategy development is that implementation fails less often. This is simply because the employees involved in the IT and specialist departments also feel responsible for successful implementation. Changes are more likely to be accepted if they are brought about by their own ideas or users have the feeling that strategic decisions are not being made over their heads. This behaviour is sometimes also based on the “not-invented-by-us” syndrome. This is a reluctance, i.e. a negative attitude towards ideas and innovations that are brought to the IT staff from outside. The more and the earlier the employees from the affected divisions are involved, the greater the willingness to accept and go along with the IT strategy.
Realistic and concrete maxims for action instead of theoretical treatises
IT strategies that the company’s own IT professionals have been involved in developing are more compatible with the company’s reality. Outsiders are not familiar with the current (political) situation in the company, do not know about IT investments that have just been made and ongoing IT projects, or are simply too far away from the day-to-day business. The latter is often cited as a main reason for bringing in outsiders, supplemented with a reference to a possibly prevailing operational blindness. However, this is often overrated. In many cases, in-house staff are quite capable of freeing themselves from operational blindness if the questions are asked appropriately and they do not experience interference from the supervisors present. The measures proposed by the own IT staff and users are more concrete and tangible. People know exactly what could be done, even in detail, because they deal with the processes and operational issues on a daily basis or are in direct contact with internal and external clients.
Simple is not always the best strategy, but the best strategy is always simple
Simple and understandable should be at least the mission and vision of corporate IT, which as guidelines reflect the IT strategy. Storytelling is an essential tool for successful communication in today’s world. This also applies to the internal corporate communication of IT services vis-à-vis specialist departments. The more IT employees were involved in strategy development, the more stories there are to tell. Both managers and experts tend to use a lot of anglicisms. Technical terms that are on everyone’s lips at the moment. Und so werden diese “Modewörter” oft in die Strategieformulierung aufgenommen. Das fördert aber Missverständnisse bei den Mitarbeitern und konterkariert manchmal die eigentliche Botschaft dahinter. Strategies are there so that everyone can understand them and what needs to be done to implement them. Keep them simple in communication and find out early on by involving your own staff as well as the users.
Meets the expectations of a new generation
The classic approach to IT strategy development is also at odds with the new world of work (New Work). Employees want to be involved in the future direction of IT. And not be presented top-down by managers for implementation. It would also be fatal not to take into account the opinions and ideas of Generation Z, because they work with modern IT applications and communication media, and have a pronounced interest in technology and are open and receptive to new technical innovations that could be used in their own companies. Generation Z can thus contribute important innovative impulses to the development of the IT strategy.
Practical tips for participatory IT strategy development
You can also get further impulses in the article Strategy development in the 21st century.
Conclusion
Dhe traditional approach to IT strategy development, where top management retreats with its team of consultants and works out a strategic plan behind closed doors, has had its day. It is no longer enough to present the results of this work in the form of powerpoints to staff in town hall meetings and then set a specific budget for them to implement the strategy. The IT managers already benefit from the participation of their IT specialists as well as the users in the analysis phase (Where do we stand with our IT today?). No one knows the company and the industry as well as they do. It is important to get away from old ways of thinking that strategic IT management is the sovereign task of the CIO or IT director. One would overlook the great potential that lies in one’s own IT organisation if one instead only relied on the knowledge of a few.
Picture by rawpixel.com – www.freepik.com
Die 5 größten Herausforderungen im Management Digitaler Transformationen
/by Christian ArentzenÄhnelt Ihr Management der digitalen Transformation einer aneinander Reihung von IT-Projekten oder einem IT Großprojekt? Hm, falls Ja, dann sollten Sie kurz mal innehalten und die nachfolgenden Herausforderungen im Management Digitaler Transformationen sich durchlesen. Falls Nein, dann lohnt sich das Lesen trotzdem. Es gibt nämlich wesentliche Unterschiede zu beachten. Wer eine digitale Transformation steuern möchte, wie ein IT-Projekt, wird am Ende scheitern. Erfahren Sie hier die wesentlichen Unterschiede, und wie Sie als verantwortliche Führungskraft einer digitalen Transformation damit umgehen können.
Daten sind das Fundament einer jeden digitalen Transformation
Gewiss, auch in vergangenen IT-Projekten wie die Einführung einer ERP Lösung waren Daten wichtig. Aber sie standen nicht als oberste Priorität auf der Agenda des Programmverantwortlichen. Wer eine große SAP Einführung einmal mitgemacht hat, weiß aber wie sehr “saubere” Datenbestände und ein klares Datenmanagement am Ende einen erfolgreichen Rollout beeinflussen. In einer digitalen Transformation sind Daten jedoch der entscheidende Faktor. Vergleichbar einer Energiequelle für die fortlaufende Transformation im digitalen Zeitalter. Egal ob für den Einsatz künstlicher Intelligenz, Industrie 4.0, Digital Twins, IoT oder für die ersten Schritt im Metaverse … immer sind oder werden Daten die Treiber sein. Die Digitale Transformation bedeutet vor allem eine Veränderung hin zu einem daten-getriebenen Unternehmen. Ein aktueller Artikel von McKinsey (The data-driven enterprise of 2025 vom 28. Januar 2022) zeigt 7 Daten-Anforderungen auf, die es in folgender Form auch im Management einer digitalen Transformation zu berücksichtigen gilt:
“Das Ziel ist klar, nur weiß man nicht wie es konkret aussehen wird.”
Eine Digitale Transformation ähnelt einem agilen Vorgehen: das Backlog wird gefüllt, aber die Priorisierung kann sich von Zeit zu Zeit (Sprints) ändern. Das heißt konkret: die Absicht ist meist klar, nämlich möglichst viele Abläufe zu digitalisieren oder die Kundeninteraktion auf Digitale Kanäle umzustellen. Aber welche Anwendungen dafür am Ende genutzt werden, welche Abläufe wann umgesetzt sind oder wie weit und wo KI zum Einsatz kommen wird, kann nicht von Beginn an festgelegt werden. Meine praktischen Tipps hierzu:
Kein ‘One solution fits all’
Die Digitalisierung ist nicht geprägt von einem einzelnen Big Player. Auch gibt es keine integrierte Lösung wie SAP oder Salesforce. Und falls Ihnen das angeboten wird, dann seien Sie misstrauisch. Die aktuelle Phase der Digitalisierung ist geprägt von einer unzähligen Vielfalt an Lösungen. Täglich kommen Startups auf dem Markt, die neue Innovationen bieten. Tech-Giganten wie Microsoft, Google oder Meta (Facebook) versuchen aus Eigeninteresse möglichst vieles unter einem Hut zu bringen. Interessant ist aber zu beobachten, dass dies meist durch offene Schnittstellen (API’s) geschieht. Und genau darauf sollten Unternehmen achten, dass die Lösungen flexibel eingebunden werden können und entsprechende Schnittstellen bieten.
Sie sollten auch die Möglichkeiten von Cloud-Lösungen nutzen. Damit bleiben Sie flexibel in der Einbindung neuer Applikationen. Die oben genannten Hinweise gelten entsprechend auch für Eigenentwicklungen. Falls Sie dazu externe Partner engagieren wollen, so setzen Sie auf Mikroprojekte, also kleine Projektausschreibungen, die von Zeit zu Zeit verlängert oder erweitert werden. Eigene Lösungen sollten dabei auch nach der Minimum Viable Product (MVP) Philosophie entstehen. Das heißt, primär geht es darum möglichst schnell ein lauffähiges Produkt auf die Beine zu stellen, das dann in Iterationen weiterentwickelt wird.
Neue Anforderungen an Release-Management, Rollouts und DevOps
Die bisher genannten Herausforderungen im Management Digitaler Transformationen führen gleichzeitig zu gravierenden Veränderungen an organisatorischen Abläufen:
Disruptive Solutions oder der Umgang mit neuen Technologien
Disruptive Solutions stehen im Zusammenhang mit digitalen Transformationen für technologische Lösungen, die das Zeug haben, die Transformation eine neue Richtung zu geben und so Prioritäten und Roadmaps durcheinander wirbeln. Problem ist nur, dass der disruptive Charakter dieser Trends zu Beginn Ihres Aufkommens schwer einschätzbar ist. Aktuelle Beispiele dafür sind Web3 und Metaverse. Beide Technologien wirken sich gravierend auf die Geschäftsprozesse oder gar auf das Geschäftsmodell aus. Mein Tipp: wenn man nicht gerade an der Spitze der Digitalisierung stehen möchte, reicht es ruhig zu bleiben und die Entwicklungen zu beobachten. Je besser Sie die Herausforderungen im Management Digitaler Transformationen kennen und entsprechend agieren, desto schneller sind Sie auch bei der Berücksichtigung möglicher disruptiver Technologien. Dies gilt besonders für hier als erstes beschriebene Herausforderung ein daten-orientiertes Unternehmen zu werden. Ist erst das Datenmanagement optimiert, kann man innerhalb kurzer Zeit auf Entwicklungen im digitalen Zeitalter reagieren ohne Wettbewerbsnachteile zu erleiden.
Picture by rawpixel.com – www.freepik.com
New approaches in the project management of large-scale IT projects
/by Christian ArentzenEvery IT executive struggles with the implementation of large-scale IT projects. Studies consistently show that two out of three large programmes regularly fail to meet the original budget, miss the schedule and fall short of user goals and expectations after a long period of implementation. Often by a multiple.
These lapses are particularly detrimental to companies, as large programmes are usually of critical importance. Whether it is a global consolidation of ERP systems, the system-wide harmonisation of operational processes, or the merging of financial data across locations.
A number of new methodologies and tools that have emerged in recent years can significantly improve the implementation of large programmes. Combined with disciplined and experienced project management, the success rates of complex large-scale technology projects can be significantly increased.
We’ll show you how.
We show you below how programme management can be supported with the help of modern and partly digital applications.
Using agile methods
Even companies that are committed to agile development often resist using agile methods for large programmes. This is not about black and white thinking, either agile or not, but rather using the advantageous components of agile management for themselves. From our experience, these are:
.
.
.
An agile mindset also encourages project staff to work more closely together, to break down possible silo thinking, to react more quickly to change, and to keep testing and learning.
The use of agile methods in large-scale projects also brings some advantages. The conversion of programmes that have already been running for some time to agile development also pays off – despite the late timing of the conversion:
.
.
.
.
.
Using design thinking
.
Many large programmes meet functional requirements but not the true needs of users. To meet the users’ requirements, design thinking comes into play. This is a method of problem solving that helps deliver products and features that users want and need and are therefore more likely to use. Another benefit is savings, as teams only develop the features that are really needed.
For large programmes, design thinking starts with identifying user requirements, through a mix of quantitative survey and qualitative research. This gives a clear picture of how users want to use the product, what their experience has been so far and what needs have not been met so far. It would be a mistake in a long-running programme to see this as a one-off. Rather, it needs regular and intensive user involvement throughout the programme’s life, for example in the creation of prototypes and in user tests. The comparison with the traditional approach should make clear how design thinking can work.
In the traditional approach, the user would be involved in the design process.
In the traditional approach, one would start with the collection of requirements from R&D, production, sales and customer service. This collection is often done in isolation from each other and then recorded in a requirements and specifications document. This is usually so complex that a review by the technical department more or less follows.
In contrast, within the framework of design thinking principles, cross-functional workshops and interviews take place to collect current problems and requirements together. Today, the use of a “digital twin” (Digital Twins) can be helpful. This is a digital simulation of a process on the computer. This makes it easier for those involved to identify problems and necessary interactions. This leads to an early exchange of information between the departments concerned, users, suppliers, providers and developers. On the one hand, an understanding of the true requirements is created for all, and on the other hand, the basis is laid for close and successful further cooperation during the course of the programme. This approach also speeds up the release of functions and facilitates the prioritisation of requirements in the product backlog by the product owner.
Cloud-based services
.
Many executives tend to reduce the benefits of the cloud to efficiencies in infrastructure management. However, the possibilities inherent in cloud services can also be seen when applied to complex large-scale projects. The features offered by many cloud service providers give programme managers flexibility in deploying different environments. Cloud solutions make it possible to scale development environments within a short period of time, allowing prototyping or testing of novel solutions in a short period of time. The creation of project reports, which is usually resource- and time-intensive, can also be done much faster with the help of the cloud.
On the software development side, using a Platform-as-a-Service (PaaS) solution can significantly increase productivity and provide access to thousands of innovative services.
But it is not only during project realisation that the cloud can be used sensibly; even when determining the basic solution architecture, numerous cloud services now open up new options. Opting for a software-as-a-service (SaaS) solution, for example, can avoid the effort of custom development and lead to an equivalent solution that is also easier to maintain.
More flexible through microservices and modular components
.
Many companies are moving to more modular, flexible architectures that allow for the inclusion of microservices, for example. This move allows companies to rely on multiple vendors in a programme, reducing dependence on just one major implementation partner. This also solves one of the biggest problems in managing large programmes: with single-vendor solutions, it is almost impossible to exert constant cost pressure, as fixed-price contracts often include a significant risk premium and change orders are common. On the other hand, time-and-material contracts create incentives for providers to extend or expand programmes and thus increase their revenue streams.
Modular architectures, on the one hand, allow clients to collaborate with multiple providers as mentioned, and on the other hand, individual providers can be replaced as needed. If several development companies work together in the programme, they can either compete against each other in each project phase or each receive smaller work packages (microservices), e.g. front-end designs or development and testing services. As the programme progresses, the best-performing providers – who bring in consistently competent staff at a reasonable cost – can then win the contract for a larger portion of the work.
Conclusion
.
Large-scale IT projects continue to pose immense challenges to corporate executives. Their implementation has a significant impact on company operations. Not least, such programmes require massive budgets over several years, tie up a large number of employees in the company and are crucial for the careers of many executives involved in the project. Whether such programmes are successful certainly depends to a large extent on the leadership qualities of the people involved. In recent years, however, new approaches have been developed and technical possibilities have been added that project managers can access. Those who use these possibilities and apply them to their programme significantly increase the likelihood of success of complex projects. The best thing to do is to discuss with the project managers at Arentzen & Partner the extent to which the approaches presented could also benefit you and your project. Contact us!
Images used:
Computer photo created by standret – www.freepik.com