Why does new technology so often fail to deliver its promised outcome?

This article arises out of a Linkedin post by Alistair McLeod and a comment to that post by my former colleague David Morton. I started to post my own comment but ran up against Linkedin’s length limit before I’d even started!

I could write a book on this subject and all its many ramifications so let me begin by setting some ground rules.

This article addresses the use of IT (or “new technology” in general) within business – from the largest global corporations to SME scale – and organisations of any scale.

The question of how to successfully implement new technology into an organisation (turning the title of this article into a positive) is such a large subject that it really does require a book to explain. Something that starts with “How to select the right technology and supplier” through how to develop and manage a successful long-term working relationship with the chosen supplier and how to ensure that the once new technology adapts as the business changes or develops so that it continues to deliver value to the organisation.

Rules set – onward

The original post talked about “new technology” – a term which taken at its broadest could mean anything from a new AI driven photocopier to an enterprise-wide IT system that covers all or the majority of activities in which the organisation engages.

As the original Linkedin post leant to the latter I am going to use the word “system” to describe what I talk about. The term “system” can be used in a very narrow sense.

To give a trivially silly example a common toilet could be described as a “system” comprised of components connected in such a way as to deliver a measured quantity of water in a manner most likely to flush waste into a drain then automatically refill its cistern to a precise level and volume so as to be ready for its next use. Voila! The common toilet is elevated to the level of a “system” – though not “new technology”.

Silly examples aside I use the term “system” in its broadest sense. A more relevant example.

In the IT industry (and business in general) people talk about “IT systems” as if they exist and serve a purpose entirely on their own while disconnected from the world and the people and other “systems” with which they must interact before they become useful.

While it is as clear as clear as can be that no “IT system” can perform any useful function on its own, business leaders and organisation heads continue to say things like “We are busy installing a new IT system to improve ….” – something which usually causes me to fall asleep or move elsewhere rather than answer the inevitable following questions about my opinion on the “new system”.

Listen very carefully – there is no “new system” – only the old one that needs to evolve.

The “system” these people are talking about is no more than a single component in the large system – being the organisation they are in charge of.

Viewed in isolation the “IT system” they talk of is as useful as a heart waiting to be transplanted – and may or may not prove useful depending on how well all the pre-implementation checks were performed.

When I talk about a “system” in the context of an organisation I use the word recognising that any IT system (or “new technology”) viewed in isolation is as useful as a toilet sitting on a supplier’s shelf disconnected from water supply or drain.

This is an article, not a book. So I am going to address just the single most important cause of system failure that I have seen far too many times over decades.

I have no formal research to back up my opinion but my experience is that as many as 4 out of 5 (80%) of “new technology” implementations or “IT systems” fail to meet expectations and can be described as failures – though admitting their failure is often too painful to admit by those who have invested (often organisation threatening amounts of money) in them and continue to pour resources into them rather than casting them aside, before trying to learn why they went wrong and investing those additional resources in a system that is likely to work and deliver value.

So consider 80% an underestimate.

I am heading into big book territory again so I will return to the very narrow topic of this article.

So, quick answer: When considering and implementing any new technology the entire organisation must be considered on a systemic level and the needs, desires and fears of all stakeholders must be taken into account if the new technology is to succeed or provide anything of value.

I suspect a little more explanation is called for so here goes.

As someone who has seen and tackled the issue of using new technology to improve (insert any goal) for about 50 years independently and in organisations of all sizes I’ll describe the single reason that is most commonly missed when trying to implement technology to effect desired change (whether that be productivity, business performance, quality, service levels, share price …) and briefly – this is an article, not a book – touch on a few other common causes of failure.

“New technology” is not a magic bullet that achieves a goal by itself.

If simply imposed on an organisation it will fail to achieve any kind of positive outcome – because those affected by the changes it brings (often enormous) see it as an imposition and the effort demanded by the change process on their existing workload undesirable as a result. Cue system failure.

When implementing new technology for change in any business I ask a simple question:

“What benefits does it bring to every user (stakeholder) that comes into contact with it?“

Simply walking round an organisation and asking staff at all levels from board members to administration staff, to department head, to data entry clerks to production workers will reveal a broad range of hopes, fears and desires from introduction of new technology and the inevitable swathe of changes that come with it.

At board level a director might name a strategic goal (greater profit, improved competitive ability, higher share price …) as the greatest desire. Talk to the head of accounts and they might reply “I’d like to have time to eat my lunch in peace” – a statement that hides a thousand urgently needed changes in working practices – but staying away from a book … A hard-pressed data entry clerk or shop floor worker might respond “I’d like to make the early bus/train home to spend more time with my family rather than being stuck here completing my workload“.

A common fear is that the technology about to be introduced will threaten job security.

These are simple examples to illustrate a point – in the real world expectations, fears and desires are more complex.

The point is …

… If the introduction of new technology is to have any chance of succeeding across an organisation every person that it effects must obtain benefit(s) of value to them – even if the benefit is as simple as having time to finish their lunch-time dessert.

Deliver those individual, personal outcomes (or demonstrate how they will come about from deployment of the new technology) and you have a team that will willingly work together through the the implementation (change management) period and help deliver a successful outcome.

A concept so simple it is missed or ignored by >95% of organisations in my experience.

To anyone who thinks that number is an exaggeration I will say that given half a day of full access to your organisation, staff and IT systems I would find at least a dozen ways you are not using what you already have to best effect. Given a full day I would identify at least 100 areas in which you could better use existing systems or investment in upgrades or replacements would be profitable.

So why do systems fail to meet their desired objectives?

Fundamentally there is no difference between the human body and the largest global corporation. I will explain :

• The human body is a collection of organs (brain, nerves, muscles, eyes …) and processes that together form a system – one that requires all component parts to work in harmony to survive
• A global corporation is a collection of decision makers (its board), production, administration, sales, marketing and functions that collect, analyse, process and provide information – all of these component parts must work in harmony as a system if the corporation is to survive.

A stretch? I don’t think so. My point is that at an abstract level the system – whether a human body or a business or other organisation of any size has many components and it needs all of them to work harmoniously and efficiently if it is to survive.

• If a human body suffers serious illness or injury causing organ failure or blockage of essential fluids the outcome is death. Or, in the abstract, undesirable system failure.
• If a corporation suffers production delays, financial upset or failure to supply information essential to proper decision making it is equally unlikely to survive. Or, in the abstract, undesirable system failure.

There is a lot to learn from this simple analogy. The one I talk about here is that it is ridiculous to take a single component from the whole system and select a replacement – effectively at random without considering its effects on other parts of that whole system

• If an organ, incompatible with a body’s blood type, is transplanted it will die and the body (system) in which it has been placed will fail.
• If an IT system (just one component of an organisation) proves incompatible with its users or fails to keep essential information flowing the organisation is likely to fail.

Very different “systems” but the analogy produces too many simple analogies to write here.

I am trying to get across some vitally important points that concern the outcome of introducing any “new technology” into an organisation of any scale :

1. It is impossible to consider any new technology (corporate IT system or AI driven vacuum cleaner) in isolation. It is essential that its compatibility with the rest of the organisation (processes, information flows, stakeholders …) be determined and verified before it is introduced or consequences will, at best, be poor and at worst, fatal. Outcome = system failure.
2. It follows that the organisation must be viewed as “the system” and any IT or new technology viewed as no more than a sub-system that must be compatible and work harmoniously with every other part of the organisation – the system – as a whole.
3. Extend this understanding and other factors arise such as :
   • Why are IT systems (hardware and software) considered separate from “change management”? These two things are not separate but must work and interact harmoniously if the outcome is to be productive and successful.
   • If the IT systems supplier must out-source the change management function caused by its product then a valid question is how does the supplier know enough about the activity and processes of the organisation (never mind its particular operating methods) to design a system compatible with it. If the supplier does have that detailed knowledge why can it not provide the necessary change management function – clearly they are already better qualified than any third party.
   • Viewed from the other side if third party change management or (far, far worse) management consultancy services are chosen to provide (essential) implementation and successful harmony between new IT system and the rest of the body corporate and (extremely wasteful) supervision and oversight of a technology supplier, that supplier should not have been selected if there is doubt as to their ability to implement their own technology, process and change management included.

What lessons can be learned?

Too many to cover in an article but this is not a book! In no particular order :

• It is entirely possible to ‘square the circle’ of apparent conflict between the desires and fears of operational staff and the strategic objectives of the organisation – simply by recognising that the organisation is the system and that every person, component or information flow inside it likely to be affected by the “new technology” must be considered if success is to be achieved.
• Correct selection of a correct technology supplier is essential. Read that seemingly doubled up sentence again and as many times as you need until you understand it. When I ran my IT services and software development business we were often presented with 6inch (15cm) thick “Invitation To Tender” (or, “ITT”) documents that specified every single field of data and range of acceptable values the sending organisation deemed necessary … but contained nothing about the sender’s activities, methods of operation, consideration of compatibility with other parts of their system and, of course nothing about the needs, fears and desires of other stakeholders or how the implementation (change management) would be conducted or by whom. Such ITTs were always returned to sender with a polite note thanking them for considering us but declining to participate in their selection process. I offer this as an example of the wrong way to select a supplier. A field that holds a code unique to your organisation is a trivial change for any technology supplier worthy of consideration. There are far more important factors to consider when selecting a supplier likely to successfully introduce new technology to an organisation. I hope some of them have become obvious in this article.

What other pearls of wisdom do I have to offer?

The following list is far from complete (it represents thoughts as I sit writing this on a Saturday morning) presented in no particular order. Hopefully they will cause a few ideas of your own to spring into mind.

• As well as being a complete waste of money, effort and time – sending an IT or technology company a finely detailed specification of the new doo-dah you want is the technological equivalent of teaching your grandmother to suck eggs. To those who don’t speak colloquial English you are offering to pay someone else to do something you are convinced you can already do better yourself. Expect inevitable failure. I can guarantee it 100%
• When considering the criteria to be used when selecting a technology supplier take time to understand that you will have need of them long after the contracts are signed and the new technology has been fully implemented. Far more important to have a supplier that invests its time understanding your business, its activities, processes and people and can demonstrate that it will stay and support your business as it evolves over the lifetime of whatever technology it initially provided than put blind faith in a supplier because it happens to be on the Fortune 500 list. Pick up back issues of any IT industry journal (or spend five minutes with any Internet search engine) to see the l-o-n-g list of enormous technology companies that have gone bankrupt overnight or been taken over and absorbed into a competitor leaving their former customers in the dust – and with zero support.
• Never use a consultancy firm to conduct a technology selection process on your behalf. I could at this point give some industry insider examples of what actually happens but will restrain myself to explaining that you will first be charged for writing a specification of the technology or “system” you need (which will bear no more than a passing resemblance to what is actually required and will contain all the above “never do this” examples I gave) then the specification will be posted out to “selected and pre-vetted” potential suppliers – the only ones of which who will respond are those who either invest more money in their sales department than on their R&D budget or any so desperate for business they will feel the have to “play the game”. The consultancy will then produce a “shortlist” for consideration – presented as the result of a detailed and scientific analysis of the market – actually the dressed up equivalent of picking a horse race winner by sticking a pin in a list of runners while blindfolded. Far be it from me to suggest that the selected favourite could possibly have a “friendly” relationship with the consultancy. Eventually you will be encouraged to place a large contract with the “most qualified” supplier. It takes most organisations between 18 months ~ 2 years to realise they have been sold a pup / taken for a ride / sold a product that neither exists nor stands any chance of delivering any value for them.
• The most difficult question anyone can ever ask you is “Why?” Behind that single word lies a can of worms most people have never looked at and even less have the ability to cogently explain. I used to ask “Why?” A LOT! Amazing what is discovered with a single word.

Reality is often hard to face. The field of IT – its range of products and services is so vast and the technologies it encompasses change so fast that no IT professional could truthfully claim to keep up with a fraction of them.

To a businessman – director of a multinational or owner of an SME – or leader of a non-profit my honest advice is that you stand no chance of keeping up with the ever-changing landscape of IT. You must put trust in some IT professional who does have the knowledge, skills and expertise in the fields in which you are engaged to advise you on the best way forward.

Anybody worth talking to will be expensive – but use your common sense and usual supplier checks to satisfy yourself that whatever money you spent delivers value in return.

If your needs are complex and you need somebody with high level and/or wide-ranging business experience then get prepared to spend lots more – after again satisfying yourself that you will obtain value for whatever you spend.

And so to finish

In case you have not been able to pick the important out of the morass that has gone before I advise anyone considering the purchase or implementation of “new technology” to :

1. Get into the habit of asking “Why?” Start by asking yourself why your organisation needs to go through the upset of implementing new technology. It was always the first question I asked any client I engaged with. If you cannot find an answer it may be time to walk away or at least take a step back. As a “hungry” supplier I would always walk away from any client who could not not clearly state their objectives for the new technology they were asking for and clearly explain the success measures they would apply to its implementation. If you get past this stage add “Why?” as a supplementary question to almost every other question you ask in what follows. You could be amazed at what you learn.
2. Look at your entire organisation as a living, changing system, as likely to be harmed by having a part replaced or introduced as being changed for the better.
3. Involve stakeholders at all levels of your organisation in the selection, outline specification and the planning for implementation (change management). Don’t attempt to tell people you might be paying how to apply their skills – let them ask their questions, be open and knowing when answering them and use that process as part of your selection decision. You should be prepared to be surprised how often the most junior member of staff – in the right environment – contradicts their managers. Much happens at the coal-face of an organisation that senior staff are not aware of – not casting aspersions at anyone, nobody can be everywhere at once and staff left to their own devices have a habit of developing creative solutions to problems their seniors cannot find time for. You need that information.
4. Really important … ensure that you obtain the desires, needs and fears from staff at all levels of the organisation – main board to shop floor. Then ensure that each one is addressed. This forms a substantial part of the specification of needs you should be presenting.
5. Do not out-source the job of specifying the technology you are seeking to external consultants. You will gain neither protection nor reduced workload nor access to expertise. In short, if you cannot answer the difficult questions any reputable technology supplier will want to ask after following the process outlined here you will not obtain the benefits – corporate or individual – that you seek.
6. Finally … what is the most difficult and awkward demand you can throw at a technology salesman? “Show me!” If you ask whether the technology or system proposed can be configured to process sales invoices the way you want and the response is “Yes” … then … “Show me!”

If you complete this process successfully you will not only be in a position to engage with potential suppliers who (should) know far more about the technology you seek and how to perform the essential change management and stay alongside your organisation for the lifetime of the technology adapting it as your organisation evolves and its needs change, you will also know far more about your organisation and the components that keep it ticking.

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In case anyone is wondering, no, I am not talking up my own stock – I am happily retired and professionally inactive, resistant to many enticements that have gone before to draw me back to work. I remain involved in IT and business circles as they have been (two of) my life’s passions. I occasionally share my thoughts in articles like this for free – and as with any free advice take it for the price you paid for it.