Government IT Project Woes and Estimating Total Ownership Costs

A recent government report showed 81% of budget or $57 billion in IT projects in danger of failing. Detailed reports on the hearings can be found here.     Of 413 IT projects identified by OMB and federal agencies NEARLY 80% OF THEM WERE IDENTIFIED AS HAVING BEEN POORLY PLANNED. The scorecard for IT projects shows much progress but much work left to do.

Some of our recent analysis of IT costs seems to indicate that software development may be the smallest of four components:

1. Software Development
2. Software Maintenance
3. IT Infrastructure
4. IT Services

In this example sanitized system we see software development costs (the costs many track the most.. and for good reason.. these are the highest risk items) were about 10% of the total cost of ownership.  Meta analysis shows IT Infrastructure & services can be 60% or more of the system's total ownership cost.