Saturday, 11 April 2009

ITIL ROI Part 3 / The Myth of the ITIL Project Part 1

There is an accepted, but arguably untested, view that you should implement ITIL as a project.

How can it be untested I hear you say, surely there have been lots of successful ITIL projects?

Well there have, I've been involved in several, in fact I designed (we say architectured these days) two ITIL projects that went on to win the itSMF Project of the Year Award, and was was heavily involved in the execution of a third award winner.

So that proves ITIL can be implemented as a project, yes? Well yes, but that doesn't prove that it is the best way to do so. How much service improvement activity gets thrown into the project that should actually be being done as part of the Business As Usual (BAU) day job?

In all the usually quite spurious claims of proven ITIL ROI one thing you'll very rarely hear factored in is the cost of failed ITIL projects. BTW I'm not saying that ITIL doesn't provide a positive ROI, only that most of the claims are spurious. If you are making a decision to implement ITIL by running a project you would be sensible to factor in the failure rate across the industry.

Very simplistically - There are four ITIL projects each costing $1m. One of those succeeds and generates gross savings of $2m, a net saving of $1m and a positive ROI. Across the four projects though it is a different picture. Let's be generous and presume the other three projects didn't do any actual harm to the long term cost, but didn't generate any saving s either. Factoring that in to the picture we find that ITIL projects as a whole actually generate a negative ROI. They have cost the industry $4m, for gross savings of $2m, producing a net LOSS of $2m.

How many ITIL projects fail? Well it is a tough one to answer, because first of all you need to define what success means. My gut feel is that as many ITIL projects proceed their effective scope is reduced, but they are still declared a success at the end. In fact I suspect that in the great majority of cases what begins as a project focused on cultural change becomes yet another software tool implementation. Part of my argument against ITIL projects is that the IT project management mentality encourages that shift of emphasis.

Personally I was very skeptical of claims emanating from some organisations that they had implemented ITIL v3 within months of publication.

Another issue in judging success is that the delivery of ITSM is, by its very nature, a long term activity. You can not measure the success of an ITIL project the day it goes live, you need to judge it over a number of business cycles. Do that and you find something interesting: In the UK where ITIL has been around a long time some organisations are on their third of fourth ITIL project.

So my first question is this: Does the fact that some ITIL projects are successful mean that ITIL projects are consistently successful?

My second question is: Why are some ITIL projects more successful than others?

My third is: Are they successful because they are projects, or despite being projects?

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