A catalogue of management and technical errors led to
the "potentially damaging failure" of a £17m project to modernise
the IT systems at the government's housing agency, documents
obtained by Computer Weekly reveal.
The report, based on a 10-month investigation by external
consultants, analyses the performance a flagship IT project, which
aimed to transform the workings of the Housing Corporation by
replacing legacy IT systems with a modern Citrix-based IT
system.
The Housing Corporation, which invested £1.9bn in building
affordable homes last year, released the report last week following
an
18-month battle with Computer Weekly under the Freedom of
Information Act.
Chief executive Jon Rouse
commissioned Methods Consulting in May 2005 to investigate the
troubled project, which at one point consumed a quarter of his
management time.
" We fully accept the report findings and its recommendations.
The purpose of the review was to find out what went wrong and to
identify lessons of the future," said the Association's chief
executive, Peter Marsh, in a statement last week.
The
ASP project, which started in 1999, aimed to give housing
associations direct access to its IT system and to deliver desktop
applications to its 450 staff through a Citrix thin client
infrastructure.
But the project failed to meet its deadlines, failed to deliver
to cost, and damaged the moral of the Corporation's staff and the
organisation's reputation, the
independent investigation by MethodsConsulting
concluded.
The report draws detailed lessons on the project's failings and
makes recommendations for the conduct of future IT projects, which
will be widely applicable to other public and private sector IT
projects.
The investigators point the finger at a culture of weak
management, a lack of openness combined with the corporation's lack
of technical and procurement expertise.
It allowed
poor staff relations, particularly in its IT department, to
"develop into a mutually distrustful environment in which the
executive appeared to have little control."
The project team lacked managers with strategic IT
understanding, procurement strategy, and contract management
skills.
Decisions went unrecorded, and minutes of meetings were poor at
all levels. User needs were not properly defined, and governance
and management resources were overstretched.
"Important detail was frequently overlooked and decision-makers
were often presented with substantial documentation and little time
to review it. Strategic procurement mistakes were made at strategy,
final award and implementation stages," it said.
"There was no systematic assessment of risks, no evidence of
implementation or resource planning, and unrealistic expectations
were raised of an early timetable for implementation,"
Although the procurement route followed a well thought through
procedure, the procurement team missed warning signs a key stages
in the process, leading to the contract being awarded to an
inexperienced supplier the report concludes.
Time pressures led managers to pay insufficient attention to
detail in the preparing the contract schedules, and mistakes were
made in agreeing the service code of practice. The corporation did
not consult its legal advisors in the early stage of the contract,
and failed to manage it until the relationship was in substantial
difficulties.
Although the corporation's external advisor, KPMG, endorsed
using Citrix as a general, industry-standard tool, it not
specifically endorse the ASP project. The outcome was, however,
presented within the Corporation as an endorsement of the ASP
strategy.
The project suffered from repeated difficulties during pilots,
including service failures and poor performance levels, but, the
report concludes, neither the Corporation nor its supplier, Elonex,
now in liquidation, appeared to have understood Citrix sufficiently
to find solutions, said the consultants.
Executives at the Housing Corporation were unable to
sufficiently understand the technical issues involved in the
project, and presented a view of the project to the Corporation
board that "unintentionally underestimated the emerging
problems."
The chief executive of the Housing Corporation
terminated the contract with Elonex in December 2005, on the
grounds of material breach of contract, the report reveals. It
passed responsibility for the ASP server to Elonex subcontractor,
Netstore.
The Housing Corporation has taken
steps to turn around its IT strategy, the report concludes. An
independent Office of Government Commerce review of its
current IT work concluded that it was well managed and that
lessons have been learned from past experience, the Corporation
said.
Findings of the investigation
- The Corporation lacked the expertise to manage the project. As
a result managers relied too heavily on technical advice from a
single freelance IT consultant, despite warnings that this posed a
risk.
- The business case was "inconsistent" and "incomplete". It
contained misleading assumptions and contradictory data.
- Business users had little input in the design of the system,
which suffered from
technical problems and did not meet their needs.
- Managers did not challenge the technical solution, despite
reservations from independent advisors.
- Executives gave repeated but mistaken assurances that the
project was under control, despite difficulties in the pilots
Time Line: Computer Weekly's FOIA Battle
September 2006
Computer Weekly applies to the Housing Corporation for a copy of
the Methods Consulting Report.
October 2006
Housing Corporation grants itself an extension beyond the
statutory deadline to review Computer Weekly's request.
November 2006
The Housing Corporation refuses to release the Methods
Consulting Report, arguing that publication would prejudice its
commercial interests. It claimed that disclosure of the report
would prejudice the effective conduct of the government's Gateway
Review Process. The report, it argued contained personal details
that were exempt from disclosure, and that publication could expose
it to claims of breach of confidence.
The Corporation agrees, however, to disclose 55 items of
correspondence relating to the report.
January 2007
Computer Weekly asks the Housing Corporation to review its
decision to withhold the Methods Consulting Report.
Computer Weekly lodges a complaint with the information
commissioner.
February 2008
The Housing Corporation reconsiders its objections and publishes
the report in full with only minor redactions.