IT Failure and the Dehumanization of the Workforce

By Frank Wander

It was serendipitous. By leading five turnaround transformations across four corporations, I discovered the root cause of IT failure: The industrial era dehumanization of the workforce has bequeathed management practices that are incompatible with the emotional, cognitive and collaborative underpinnings of IT today. 

It became clear to me that unsuccessful information technology organizations and projects were failures of corporate management, not of IT processes and technology, and certainly not due to the IT workers. Most of the workers were competent, dedicated professionals, toiling in cultures where the social chemistry was corrosive and ate away at the fabric of the organization. What else could possibly explain our profession’s unbroken track record of failure, one that might be unrivaled by any other industry.   

Consider how long failure has been with us. The first modern, IT mega-project was the development of IBM’s OS-360 mainframe operating system in the early-to-mid 1960’s. When the OS-360 was finally introduced in 1967, a year late, its budget had skyrocketed to more than $500 million, more than four times the original $125 million estimate. By then, the OS-350 had become a threat to both management and the company. In fact, Frederick Brooks, the endeavor’s project manager, noted in his book The Mythical Man Month: “The product was late, it took more memory than planned, the costs were several times the estimate, and it did not perform very well until several releases after the first.” To anyone in IT, this sounds like it was written yesterday, not 50 years ago.

So, when we examine failure today, we see little has changed. For nearly 60 years, IT projects, especially mega-projects, have failed at alarming rates. A recent McKinsey Quarterly study of 5,400 large projects ($15 million or greater) revealed that their collective cost overrun was $66 billion, while 17 percent of the projects actually threatened the viability of the enterprise itself.

No other human endeavor has endured such a track record of repeated failure, with an inability to discover how to get it right. With trillions of dollars of collective experience spanning six decades, how could this be? How did we get here? Why is this problem so persistent in the face of thousands of pundits, robust process frameworks, and maturity models?

Everyone has an answer, but no one has a solution. Until now, that is. A humanizing workplace movement has already begun, so this will change.

A Pattern of Toxic Behaviors

I didn’t see the problem during the first turnaround. Nor did I see it during the second. But by the third, a clear pattern of toxic behaviors and practices was evident. The workers were wrongly regarded as interchangeable parts—nothing could have been further from the truth. They were, in fact, assets, because the institutional knowledge they possessed had been acquired over many years at great cost, and had high productive value. Yet, even today, human capital is often accorded zero value in traditional corporate America, because it isn’t tracked. Human capital accounting still doesn’t exit.

Culture is also an enormous lever of productivity, and one that had been ignored. Consequently, we continue to intimately architect our networks and systems, but often leave the culture to chance; we should be intimate with this, too. Often times, corporate cultures are toxic to productivity; sometimes, even highly toxic.