Best Practice for Business Transformation Projects
Updated: Oct 12
From a project management perspective, transformation projects resemble most large scale technology or system implementations because at the heart of each of these initiatives is an enterprise business application. In some cases, a new implementation or upgrade is included as part of the project to make sure the organization is on the latest release or that the consolidated entities are on the same platform.
However, because of the changes to business operations and organization dynamics, transformation projects present a few additional challenges:
More vendor / partner involvement: As part of the project, a service provider may be taking over business processes, technology operations or both. In addition, due to risk, contracts and service levels may be fixed and provide rigid requirements for change requests.
Employee uncertainty: Part of the potential cost savings are realized through decreased headcount. Some employees will be transitioned to new roles, some may be transferred to the service provider and unfortunately others will lose their jobs.
Increased change management: Additional change management may be required because not only is the organization moving to a new application, but also a new business model.
Increased scope-creep: Because contracts and timeframes are negotiated up front, often without detailed business process analysis, scope, timeline and project complexity may expand as vendors uncover additional requirements or realize the complexity of running the client’s operations.
Duration: Based the size and complexity, transformation projects can last between 18 – 36 months and are often divided into multiple phases based on transitioning business process, functionality or entities to the new business model.
Given the additional complexities associated with business transformation initiatives combined with IT project failure rates between 50-70%, it is important to incorporate a project assurance program into your business transformation project. Project assurance is about identifying and closing the gaps that lead to the project failure by conducting periodic assessments through the project lifecycle. These assessments should be conducted by an executive consultant from outside the project team to provide objective third party analysis and create an environment for collaborative issue resolution.
Having project assurance as part of a large-scale business system implementation helps you: control/reduce project costs; ensure milestones are met; minimize surprises and provide objective analysis. The incremental costs you will incur by having an additional resource periodically conduct project assessments will be far less than the cost of project delays caused by unrealized project gaps and will provide the peace of mind that the project is on the right track resulting in a sunnier forecast for you and your project.