“Big is beautiful” is a concept that has been readily embraced by business. Size has been the main driver for many mergers and acquisitions. For example, supermarkets (both on and off-line) are wielding frightening influence in the market with their wide distribution footprint and huge buying power. And, after all, who would have backed David to beat the giant Goliath?
In the world of information technology systems, however, the concept of “big is beautiful” so often ends in tears. Big IT projects have frequently led to big catastrophes. An oft-cited example is the abandoned NHS patient record system, reputed to have cost nearly £10 billion. There are many other examples, albeit with less public profiles. In general, such failure is not widely publicised.
Past evidence shows, again and again, that big IT projects invariably overrun on both time and budget yet still fail to deliver the initial vision. But, despite this, too many large organisations keep falling into the same trap. They spend enormous amounts of time and money producing weighty specifications that try to articulate the needs of the business, resulting in long and lucrative contracts for Goliath IT companies.
Interestingly, the public sector responsible for the NHS debacle now champions smaller, smarter, cost-effective delivery.
Led by Mike Bracken, The Government Digital Service is reshaping the way that the Government manages large IT projects, seeking to ensure that overspend and overrun are things of the past. They have proved that success for digital services comes from shorter discovery phases involving end-users, together with faster delivery of prototypes for evaluation, testing and refinement. They are finding that a willingness to fail fast at the outset, coupled with the ability to evolve the solution quickly, delivers better results. And, within this, they find that smaller external contracts, with smaller IT organisations, are proving more effective.
The evidence is compelling. In one case, 98.5% of the cost of an existing project was saved by adopting this method and transferring a contract from a large multinational to a smaller British technology company.
Opening procurement to smaller, agile companies is often one of the first steps to new thinking and radical improvements. Replicating the past is not good enough if something different and better is needed. After all, the belief that Goliath couldn’t be beaten, or even challenged, proved to be a costly mistake.