Magazine article CMA - the Management Accounting Magazine

A Strategy for Reducing Investment Risk

Magazine article CMA - the Management Accounting Magazine

A Strategy for Reducing Investment Risk

Article excerpt

Are your new information technology solutions enhancing cost effectiveness and delivering expected results? Ongoing project review is a key mechanism to provide the assurances you need.

IT project failures make the headlines every day. With growing financial pressures and the need for successful deployment of information technology, management is increasingly focusing on the results of its IT investments. IT project review can be an effective mechanism for senior managers to ensure that their IT projects are "in control" and will deliver results.

IT project review provides an opportunity for management and the IT project team to revisit the issues and manage the risk throughout the entire project life cycle. And using strategies to reduce risk increases the likelihood of a successful implementation.

To assess the overall risk the organization needs to manage, interviews should be conducted with management, project staff and key users across the organization. A frank and open discussion will identify the issues and risks, and assist the project team in highlighting actions needed while there is time for pro-active adjustments.

Project review questions

Questions to consider in the project review process include the following:

Are we doing the right things?

* Are project objectives clear?

* Will the proposed IT solution support the business activities?

* What changes should be considered?

Are we doing it in the best way?

* Have alternative ways to meeting the needs been explored?

* Are there emerging technologies that should be considered?

* What changes would increase the likelihood of success?

How do we know how well we are doing?

* Are there performance standards?

* Is there regular progress reporting?

* What is the trend of staff feedback?

* What actions should be taken?

What impact are we having?

* To what extent have the project objectives been achieved?

* Are the project clients satisfied?

* Is the satisfaction improving, stable, or defining?

* Is support for the project improving, stable, or declining?

* What are the major concerns with the project and planned solutions?

* What actions need to be taken?

Is the project cost-effective?

* What are the significant costs the project could influence?

* What is the trend of costs? Causes? Action needed?

* What are the significant variances from the budget? Actions needed?

Is there clear accountability for the project outcomes?

* Is it clear who is responsible for doing what? Are the right people involved?

* Is senior management supportive?

* Is performance monitored and reported? Results to date?

* Do all those involved in the project understand their roles and tasks?

* What changes are needed?

Are key assets protected and controlled?

* Will the IT infrastructure handle the deployment of the application?

* Is IT security considered and is it adequate? What needs to be done?

* Are risks identified and monitored?

* Are incidents analysed and appropriate actions taken?

* Is ongoing continuing education required? Is it occurring?

What are the key lessons learned from the IT project?

* What would you do differently?

* Do you feel the solution is cost-effective? Why or why not?

* Where should the project go from here?

Lessons Learned

Among the lessons learned, here are some common themes raised during recent IT project reviews:

* The need for effective communication is increasing.

Organizations cannot afford to work by assumption. Open communication channels and frequent discussion among management, business staff, and IT project members must be encouraged and promoted. …

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