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Why IT projects fail – and will Social CRM make it worse?

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Not what you would call an obvious link perhaps but experience shows that understanding requirements and managing expectations is at the heart of most problems. So moving sharply forward – as it seems we are going to have to do – into Social CRM projects, which are comparatively poorly understood, seems to increase the likelihood of failure. Everyone worries about making sure their project is successful but before we go there, how about the comment in the first sentence about having to go to Social CRM, and fast? What’s that about?

The simple answer is sales! In the current market most enterprises are worrying about what they can do to sustain revenue and maintain margins. The Capgemini Global Trade Flow Index reveals a decline of 8% in the first half of 2011 and that’s a lot of missing sales activity. I haven’t seen a direct report on how prices are being impacted by both business buyers and consumers, but I have to believe that the abilities to search for alternatives and best buys using the Web are having an impact. Some of this behavior is getting pretty sophisticated with new apps that provide savvy consumers with new discount options such as Zorate, which claims to have been the first online discount voucher ‘on demand’ provider with its zApp for smartphones and iPads.

Put another way, the buyers have learnt how to use online and social media faster than many enterprises have learnt how to use the tools to prevent their current market and customer base eroding. Successful players and products are increasingly winning through good use of the medium, but the problem is exactly what is a ‘good’ use of the medium? And that’s what takes us full circle back to requirement definitions, and successful project delivery, only now just to make it even more difficult with new technology as well.

As a take on this, an interesting snippet is that this year one of the market analysts expects Apple to sell 60 million iPads. Add to that the number already out there, and there must be close to 100 million in use. In my experience the iPad has changed browsing habits – iPads are usually floating around the home in the evening, becoming an online magazine that allows people to follow up areas that interest them, and discuss them with the rest of the family or friends. This is a big change from browsing as a solitary activity in a bedroom or study. It’s made it easier to be involved in social networks, post opinions on products, or companies, etc. In short, interactivity levels are rising due to mobility devices and technology, and not because of PCs with their familiar technology.

Back to the challenge of what does ‘good’ look like and the introduction of a very helpful report from the IBM Research labs which have studied this in detail with a significantly large number of people. The results, complete with recommendations as well as findings, are all available in a two-part download from a master site. One of the charts compares the consumer reasons for interacting with companies via social sites, with the business view of why they think consumers are interacting with them (see Download Part 1). It illustrates some pretty big mismatches with the top two consumer reasons being the tenth and eleventh (last places) of the business reasons.

It seems likely that a successful Social CRM project would be measured by improvements in sales, and yet that fact alone seems to suggest that it might not succeed! Other key messages are that ‘build it and they will come’ simply doesn’t work. Instead, it’s ‘interact and dynamically change’ that works. Well, that’s not the usual way that IT departments organize their work. And what about the skills to deliver in a different manner whether you define it as ‘agile’ or something else? In short, we are looking at a rethink of what and how technology is used, delivered and supported, so with this in mind read the new report from Oxford University that shows how one in six IT projects out of a total of 1,500 studied were ‘black swans’. The report defines a ‘black swan’ as “where rare, unexpected events of huge proportions occurred where the risks should have been more obvious at the start.”

What could be the huge proportions in a small Social CRM project? Well, here’s a true personal closing story about buying a new printer and checking for views and comments on the best buy sites on the grounds that even if I knew the make I wanted there were too many models to make the choice obvious. Online interaction made me change my mind about not just the model, but the make too, in favor of another brand with a smaller market share. When I went to the local store in the big national chain I was told that they had started to stock this brand with a selection of models because demand had made it necessary.

That’s quite a huge impact alone, but what was the issue with my original choice? Their online sets of services to enhance their printer beyond its basic functions, by allowing sharing of photos, sending prints over the Web to friends’ machines etc was causing their new high-end machines to lock up, and as of yet no fix was available. Now that’s a really big ‘black swan’ in terms of an IT project failing to deliver a Social CRM project!

About the author

Andy Mulholland
Andy Mulholland
Capgemini Global Chief Technology Officer until his retirement in 2012, Andy was a member of the Capgemini Group management board and advised on all aspects of technology-driven market changes, together with being a member of the Policy Board for the British Computer Society. Andy is the author of many white papers, and the co-author three books that have charted the current changes in technology and its use by business starting in 2006 with ‘Mashup Corporations’ detailing how enterprises could make use of Web 2.0 to develop new go to market propositions. This was followed in May 2008 by Mesh Collaboration focussing on the impact of Web 2.0 on the enterprise front office and its working techniques, then in 2010 “Enterprise Cloud Computing: A Strategy Guide for Business and Technology leaders” co-authored with well-known academic Peter Fingar and one of the leading authorities on business process, John Pyke. The book describes the wider business implications of Cloud Computing with the promise of on-demand business innovation. It looks at how businesses trade differently on the web using mash-ups but also the challenges in managing more frequent change through social tools, and what happens when cloud comes into play in fully fledged operations. Andy was voted one of the top 25 most influential CTOs in the world in 2009 by InfoWorld and is grateful to readers of Computing Weekly who voted the Capgemini CTOblog the best Blog for Business Managers and CIOs each year for the last three years.

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