✎✎✎ Project Failure Examples
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When Projects Fail (A Framework For Examining Failed Projects)
Lidl didn't want to change its way of doing things, so the SAP implementation had to be customized, which set off a cascade of implementation problems. Combine this with too much turnover in the executive ranks of Lidl's IT department, and finger-pointing at the consultancy charged with guiding the implementation, and you have a recipe for ERP disaster. National Grid, a utility company serving gas and electric customers in New York, Rhode Island, and Massachusetts, was facing a difficult situation. Their rollout of a new SAP implementation was three years in the making and already overdue. If they missed their go-live date, there would be cost overruns to the tune of tens of millions of dollars, and they would have to get government approval to raise rates to pay for them.
If they turned on their new SAP system prematurely, their own operations could be compromised. Oh, and their go-live was date was November 5, — less than a week after Superstorm Sandy devastated National Grid's service area and left millions without power. In the midst of the chaos, National Grid made the fateful decision to throw the switch , and the results were even more disastrous than the pessimists feared: Some employees got paychecks that were too big, while others were underpaid; 15, vendor invoices couldn't be processed; financial reporting collapsed to the extent that company could no longer get the sort of short-term loans it typically relied on for cashflow.
The first go-live date was November But then things began to slip. But came and went and still no rollout. The lawsuit is still ongoing. When British telecom provider Vodafone consolidated its CRM systems onto a Siebel platform, they ran into problems: not all the customer accounts migrated properly. The company didn't go out of its way to advertise this, of course, but people started to notice when their accounts weren't properly credited for payments made.
And while this incident was concluded with just the fine paid, Crouse points out that regulatory oversight can, somewhat surprisingly, lead to private litigation down the road. But that litigation can go both ways. For instance, students at Washington State's community colleges have been paying a portion of their tuition every year to help the schools upgrade to a PeopleSoft ERP system that was supposed to go live in Instead, the project is still limping along. One cause of delay was internal: the 34 campuses in the system had widely varying business processes that needed to be standardized, which wasn't clear until well into the rollout.
Crouse says that this sort of mutual animosity is not uncommon. Then you have the third parties that sometimes get involved from a vendor reseller perspective. You can see either side being the plaintiff or the defendant, based on who got mad first. The Australian outpost of the venerable department store chain, affectionately known as "Woolies," also ran into data-related problems as it transitioned from a system built 30 years ago in-house to SAP. One of the biggest crises that arose was that profit-and-loss reports tailored for individual stores, which managers were accustomed to receiving every week, couldn't be generated for nearly 18 months.
The problem lay in the change in data collection procedures, but the root cause was a failure of the business to fully understand its own processes. The day-to-day business procedures weren't properly documented, and as senior staff left the company over the too-long six-year transition process, all that institutional knowledge was lost — and wasn't able to be baked into the new rollout. None of that works. Many companies rolling out ERP systems hit snags when it comes to importing data from legacy systems into their shiny new infrastructure. When Target was launching in Canada in , though, they assumed they would avoid this problem: there would be no data to convert, just new information to input into their SAP system.
But upon launch, the company's supply chain collapsed, and investigators quickly tracked the fault down to this supposedly fresh data, which was riddled with errors — items were tagged with incorrect dimensions, prices, manufacturers, you name it. Turns out thousands of entries were put into the system by hand by entry-level employees with no experience to help them recognize when they had been given incorrect information from manufacturers, working on crushingly tight deadlines.
An investigation found that only about 30 percent of the data in the system was actually correct. Some rollouts aim to tackle this sort of problem by testing new systems with production data, generally imported from existing databases. This can ensure that data errors are corrected before rollout — but production data is valuable stuff containing a lot of confidential and proprietary information, and it needs to be guarded with the same care as it would in actual production. They then failed to supply any of the protection a real production database would need. Well, it certainly didn't help Hershey's operations during the Halloween season in or make Wall Street investors thrilled. So I guess a failed technology project can't actually take down a Fortune company for good, but it can certainly knock it around a bit.
This was all back in , and the horrendous results were due to a bold ERP, supply chain and CRM project that aimed to upgrade the systems into one superstar system. Nike's tale is both of woe and warning. You see, in , HP's project managers knew all of the things that could go wrong with their ERP rollout. But they just didn't plan for so many of them to happen at once. Said Gilles Bouchard, then-CIO of HP's global operations: "We had a series of small problems, none of which individually would have been too much to handle. But together they created the perfect storm. She has been managing the Planview blog strategy for more than 7 years.
She writes about portfolio and resource management, Lean and Agile delivery, project collaboration, innovation management, and enterprise architecture. She has more than 15 years of experience writing about technology, industry trends, and best practices. She earned a Bachelor of Science in Business with a concentration in Marketing. Customer Success, Project Portfolio Management. American Airlines merger with US Airways created an overlap in technology and programs.
They knew spreadsheets were insufficient for managing resources and complex projects. To gain visibility into the broader divisional and global priorities, they began using portfolio and resource management for time entry, resource management, and capacity planning. As a result, the airline went from capitalizing 10 percent of their IT labor to 20 percent, which equated to a multi-million-dollar net positive impact on their balance sheet. Now, they have access to better, more reliable data to make critical decisions on projects and resources.
The Royal Bank of Scotland RBS needed to establish consistent, reliable data to inform financial and resource decisions. With data in different formats and hundreds of projects managed by different systems, they wanted to get a grip on their data to see their total portfolio more clearly. They could deliver on their business case and achieve ROI within 12 months. Cengage Learning was unable to forecast capacity effectively. Managing projects and resources with spreadsheets was creating complexity for the medical and education publishing company. They wanted to integrate the planning and execution stages of product delivery. They chose portfolio and resource management investment and capacity planning to show executives all the great work they could tackle if they just had the sufficient resources.
Now, they can prioritize and push projects down the timeline and more easily identify which groups need new hires. Excellus BlueCross BlueShield had limited visibility into resource capacity as many decisions were based on inaccurate data.
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