Why do Software Development Projects Fail?

Sharon Muniz
May 16, 2022
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Why do Software Development Projects Fail?

Why do Software Development projects fail?  

When I started NCN Technology we knew that there was a need for high-quality software development services. What we did not realize was how many software development projects fail. Did you know that between 70% to 90% percent of software development projects fail?!

Why do software development projects fail? Let’s review the top four reasons this happens and how to manage these risks.  

The first reason software development projects fail is the development methodologies being used. According to the Standish Group Chaos report, projects executed using traditional Waterfall methodologies have a much higher likelihood of failure than projects executed using Agile methodologies. According to some studies, Agile software development projects are 3X more likely to succeed!  What does this mean for your project and the best approach? If you lock yourself into a set of deliverables that are not flexible you will be disappointed. Reduce this risk by understanding Agile development and why it is best for your project. Focusing on result-driven development versus feature-driven development is key in your project.

The second reason software development projects fail is a misunderstanding of the business requirements. Too many times companies don’t fully understand the needs of the business and how the one solution that is being built fits into the overall business. Without this understanding, the development project might fall short of its true objectives for the project. The Business Analyst and/or Product Owner play an important role in ensuring that the development project meets the overall business needs.  Their job is to meticulously evaluate and document the potential solutions with the company goals guiding the way. The Business Analyst strategically identifies the gaps between proposed solutions and other areas of the business to increase the product success rate. This value helps keep the project costs down as well because the development team is more likely to succeed in meeting the overarching goals of the business. The Business Analyst and/or Product Owner will set clear requirements to lead the development team and will manage the sprint cycles in a fluid manner making sure that the client’s feedback and vision remain at the forefront of priority. This means there will be changes throughout the project development, and that is a good thing. When a team is only allowed to develop something without adapting to changes throughout the lifecycle of the project, it is less likely to deliver on the objectives. This reduces the risk of the development team working in a silo to develop a product that does not meet the client’s needs.  

The third reason so many software development projects fail is a lack of client involvement.  Iterative development feedback is imperative! A set communication schedule with updates on functionality and feedback is essential to the project. When the team does not have direction, they may take a wrong turn unknowingly which ends up costing more money and time. The development team must understand if they are on the right track before going too far and what was originally planned might change, and that is ok. That is why the communication lines need to stay open because no one has a crystal ball and is all-knowing at the beginning of a project.  

The fourth reason is trying to do too much too fast. This is true for an MVP (minimum viable product), but can also be true for ongoing large projects. The goal is to have successful iterative deliverables that are tested throughout the development lifecycle and confirm the functionality’s usefulness and true value. It is not to be interpreted as going slower; instead, it is being more thoughtful and ultimately delivering what the end-user really wants. This approach will help Product Owners and entrepreneurs truly understand real client needs by allowing for change when necessary to meet their desired requirements. The product needs to solve a problem and going at a pace that allows for this feedback is critical to delivering a viable application. This MVP process is introduced in the book The Lean Startup and is widely embraced by many companies.

Three critical components that are often overlooked include Discovery, Requirements Gathering, Story Mapping, and Prototyping with a clickable design. Without having a good roadmap of where you are trying to go, it becomes a guessing game and teams are more likely to miss the mark. Yet many individuals tend to want to just start developing without putting thought into these integral parts of the process. When these areas are missed, it ends up costing more, or the project fails.  

We hope this high-level summary outlining the four reasons software development projects fail has provided you with some insight to consider before your next project. If you have questions or would like to learn more about Agile software development processes and how they might benefit your company, please contact us at consulting@ncntechnology.com.


About the Author

Sharon Muniz

Sharon Muniz established her software development consulting firm in Reston, VA after 15 years of working in the software industry. NCN Technology helps clients implement best practices and software to drive their business to success. Ms. Muniz is skilled at strategic planning, business process management, technology evaluation, project and agile software development methodologies.

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