CIO's Beware: Very Large Scale Systems Projects

Abstract

Very-Large Scale Systems (VLSS) play a powerful role in shaping what an organization does and can do in a practical sense. VLSS are deeply embedded in an organization's procedures, business plans, and strategies. These systems evolve over long periods of time, often not according to some rational plan, and for a limited time they provide a significant competitive advantage over other firms. In the long run, however, VLSS become strategic liabilities and must be rebuilt. Many organizations experience great difficulty rebuilding VLSS. Indeed, most organizations attempt to avoid rebuilding VLSS until the last possible moment. Often, the organization is in a state of crisis, a strategic transition. Because of the complexity and size of VLSS, existing methodologies often are not helpful. To make matters worse, the typical management incentive structure discourages rebuilding VLSS. In a typical VLSS effort, participants soon discover that they must rebuild the organization in order to take full advantage of new technologies. A major organizational engineering effort is often required. Senior management as well as systems management routinely underestimate the complexity of the task before them. Consequently, large errors are made in estimating costs and time. Drawing on research in both the private and public sector, this paper examines why VLSS fail, why are VLSS so difficult to rebuild, what are the strategy options, and how can senior management guide the rebuilding process.