Home > The following material is a modified excerpt from the very recently
The following material is a
modified excerpt from the very recently published book, ComputingFailure.com,
published by Prentice-Hall April 16, 2001, and edited/written by Robert
L. Glass.
Something odd is happening
in the world of computing failure. Actually, two something odds.
The first odd thing is that
the rate of failure in traditional computing software projects is dropping.
The organization that collects data on these kinds of things, the Standish
Group, says that its latest, hot-off-the-presses data, as we go to press
with this book, shows a "dramatic" fall in failure rates.
The second odd thing is the
rise and fall and rise again of dot-com enterprises. Cruising along
like world-beaters at the turn of the millennium, dot-com companies
fell on really hard times come the spring of 2000, with spectacular
flameouts and massive (for dot-com companies, at least!) layoffs. But
as summer, 2000 evolved into fall, the death rate dropped again, and
the dot-com future appeared, for the moment, assured again.
Before I go on to discuss the
whys and wherefores of this failure information, I suppose I have to
confront a basic problem. You the reader may not care very much about
such failure trends at all! Well, rest assured, if that is the case
(or even if it's not!), this book really is full of failure war stories.
You know, the kind of stories that make interesting reading because
everybody loves to read abut the dumb things that someone else did?
These are in-depth stories full of learning experiences and human pathos
and all those other good and readable themes as well. They are not stories
full of dry-as-dust data on how many companies are failing, and why
that is.
Dry-as-Dust Data!
But in this chapter of the
book we will, indeed, explore some dry-as-dust data. Why? Because I
think that data sets the stage nicely for all those stories that follow.
This data-focused chapter, coupled with the final chapter of the book
(the wrap-up), represents the bread of the sandwich. What follows after
this chapter, the stories themselves, is the meat of the matter.
I hope you'll agree with me, by the end of this chapter, that even this data is not really dry as dust. I think numbers show, with sometimes fascinating clarity, trends that may not be observable if a string of facts is presented only as anecdotes. Let me give you an example.
Standish - you know, the organization
that gathers data on failed computing software projects? - has been
gathering and presenting failure data since 1995 now. When they
first presented their data, they called the report that surrounded it
the "Chaos" report, because their feeling was that the failure
rate of computing projects demonstrated that the field was truly chaotic.
What was that rate, according to the Standish data? 31% of all computing
projects, they said then, were canceled. Another 53%, they went on,
were "challenged" (completed, but behind schedule, and/or
over budget and/or without all features desired). Only 16% were listed
as "successful."
This was damning data. The
software field, at least according to this data, failed much more often
than it succeeded. Other reports, from other sources, chimed in with
comparable numbers. Interestingly, the numbers were not by any means
equivalent - some reports showed 80% and even 98% failure rates! - but
the overall message remained the same. The software field is a
troubled field.
The term "software crisis"
had been used for a couple of decades already, and this data tended
to support the claims of crisis. Many in the software field, especially
gurus and academics, had been claiming that there was indeed a software
crisis, in that most projects were "over budget, behind schedule,
and unreliable."
Now, before I go on and bring
that data up to date (remember, at the outset I said that "something
odd" was happening to this failure data) - I want to interject
myself into this story. I am a professional software specialist who
is also a software failure nut. I have been studying software failures
almost ever since there was a software discipline. I have written and
self-published informal, anecdotal, stories of software project failure.
I have published previous, edited collections of in-depth failure stories
by investigative journalists. I have read and sometimes written academic
studies of failure episodes, and failure trends. I have steeped myself
in failure so much that, if I didn't realize the not-so-hidden message
in the term, I would call myself "Mr. Software Failure"!
The reason I want to interject
myself into this story at this point is that I, personally, do not believe
that there is a software crisis. Now that may strike you as odd, since
(a) this chapter of the book is chuck full of data that seems to support
the notion of crisis, and (b) how could I possibly have created a career
studying and writing about failure if there weren't plenty of failures
to fuel those fires?
Here's my (very contrarian)
reasoning on this subject. Most of our lives, now, are supported and
surrounded by computing and software. We travel using software reservation
systems. We use software word processors to write our letters. We communicate
increasingly often with software email programs. We invest and buy and
research and study using software-driven web applications. We bank using
banking software systems, either at our ATM (especially at our ATM!)
or at the teller's cage itself. Our cars are computer-software-controlled,
and so our most of our appliances. In one of the opening quotes of this
book, we see that "the world is becoming a software world."
And, the most amazing thing of all is, this software works correctly
nearly all of the time. When was the last time your car broke
down because of a software problem, or your reservations were botched
because of a software problem? In our day-to-day lives, perhaps to some
extent unbeknownst to us all, software is doing its thing - and our
things - in a hugely successful way. Given all of that, I find it hard
to see this as a field in crisis.
Couple all of that success
with the fact that there is little consistency in the oft-quoted software
failure numbers, and my own personal conclusion is that the software
crisis is partly real, but mostly bug-a-boo set up by people who have
something to gain if everyone believes there is a crisis. Gurus with
methodologies or training courses to sell. Academics who need
funding for research projects. Anyone who relies on the claims of crisis
to convince you - or someone - that money should be spent on what they
are doing.
OK, enough of self-interjection.
Back when I began that personal aside, I promised you that hot-off-the-presses
computing software failure data.
Standish, in its year 2000
data, has numbers directly comparable to those failure rates I quoted
earlier for the year 1995: 23% of all software projects were canceled
(vs. 31% in 1995). 49% were challenged (vs. 53%). 28% were successful
(vs. 16%). These are very nice improvements. Not as good as we software
folk would like, of course, but improvements nevertheless. I especially
like that rise in successful projects - from 16% to 28% means an improvement
of 75% in five years!
But there's more to this year 2000 data from Standish: The percentage of applications completed 200% or more over the original schedule has fallen from 12% in 1994 to 2.5% in today's report. The cost of failed projects decreased from $81 billion in 1995 to $75
billion today. There was a
"dramatic" shift in cost overruns from $59 billion spent in
1994 to $22 billion today.
Something is clearly happening
in the field of computing and software. This may not be a field in "chaos"
any more. The cries of "crisis" ought to be diminishing in
a way comparable to these numbers. There are still troubled projects,
to be sure, but there are not as many as there have been in the past.
What does all of this have
to do with this book? Well, much of this book is about computing
dot-com failures, and we will return to that subject shortly. But chapter
five of this book is about traditional computing failures, and this
data provides some important background for those chapter 5 stories.
There are still fun and fascinating and frustrating traditional computing
failure stories to share with you, of course, but they are fewer in
number than they have been in the past.
Shout it from the rooftops! Computing and software are maturing into amazing, useful, and - hooray, hooray! - dependable disciplines.
And now, back to those dot-com
failures. When last we spoke on the subject, I promised that most of
this book would be about dot-coms. You know, the companies that make
a presence on the World Wide Web, offering you information, products,
and services in ways that a decade or so ago might have seemed inconceivable?
How about some dry-as-dust
data on dot-com failure? Let me start with some data that shows that
dot-com failure is not only a recent phenomenon, it's one that exploded
onto the scene.
I've been collecting computing
failure stories for some time. I chuck stories about failure into a
folder, later coming back to revisit the folder to see what I have accumulated
there. Prior to the year 2000, there was virtually nothing about
dot-com failure in my folder. What that means is, in my - reasonably
extensive - reading of the computing and general press, I simply hadn't
come across any significant stories about dot-coms that didn't make
it.
Part of the reason for that,
of course, is that the dot-com revolution is relatively new. There would
have been no dot-com failure prior to, say, 1995, because there were
no significant dot-com companies then. And, for another thing, dot-com
companies were the darlings of investors until recently. Your dot-com
isn't turning a profit? Just spend some more of our venture capital
money, please - the sky's the limit on where your company may go, and
we don't want to inhibit your thinking by worrying about mundane things
like profit.
Tick, tick, tick. All of that
was about to change. That change is reflected in the publication dates
of the material I gathered for this book. Prior to the year 2000, I
collected only six relevant stories. In the first quarter of 2000, I
gathered two more. It would be a long time, I guessed, before I would
be able to publish a book like this one, judging by the slow filling
of my failure folder.
Wrong-oh! In the second quarter
of the year 2000, April through June, suddenly 19 more stories fell
into my folder. In the third quarter, there were another 17.
What on earth was happening?
As you probably know by now,
and will soon know from the chapters that follow if you don't know already,
the venture capitalists finally slammed on the brakes. That lack of
profit, the problem that had been overlooked for so many quarters, suddenly
became vital. Dot-com after dot-com fell out of business, and into my
folder. Others teetered on the edge of failure, and also fell into my
folder.
That riches to rags story looks
like it is turning back to riches again. The venture capitalists, as
far as I can tell as of this writing in late 2000, have stepped on the
gas again. I have collected only a few failure stories so far in the
fourth quarter of the year 2000. The shakeout at the middle of the year,
the VCs seems to be saying, has done the job. The weak have been culled
from the herd. Now, they seem to be saying, onward into the future.
We shall see.
But before I turn you loose
to proceed on into our failure stories themselves, I want to present
one more collection of dry-as-dust data. With all of this riches to
rags to riches rollercoastering, you may be wondering how you can spot
another rags trend if one appears on the horizon.
Here's one way. Dot-com corporate
layoffs can be a huge clue. E-Commerce Times, in its July 25, 2000 issue,
reports that large layoffs often "signal the end for dot-coms."
"Of the 122 companies that have laid off workers in the past eight
months," they say, "24 ... subsequently ceased operations."
It's a small clue, to be sure - 20% - but still, in a world of this
kind of uncertainty, any clue is a good clue.
How has their layoff data worked out? Remember that, above, we noted a spike in dot- com failure stories in the middle of the year 2000? In that same period, E-Commerce Times reported in its Sept. 26 issue, layoffs doubled in September vs. the preceding July. There were over 4800 layoffs in September, vs. 17,000 for the whole year to that point (and roughly 2200 in July). Sure enough, there was a layoff spike - just like that failure
spike - in the third quarter
of 2000. (The numbers, E-Commerce Times says, are probably under-reported
because (a) they collect data on large dot-coms only, and (b) there
are tons of one, two, and five-person dot com companies). Why all these
layoffs? E-Commerce Times says "dot-com companies are cutting superfluous
positions with an eye toward profitability."
One of the key phrases here
is "in-depth" stories. If you're a failure fanatic like
me and want a quick fix on computing failure stories, there are web
sites - believe it or not! - that cater to that need! (Why not?
Web sites seem to try to cater to every need!) These tend to contain
one- or few-liners about who hasn't made it, and what their status is.
DotcomFailures.com was one such web site, but, ironically, it added
itself to its list of failures back in September and I suspect that
you'll find the site vacant all too soon! The more famous one
is the unfortunately-named FuckedCompany.com, which uses outrageousness
and a sort-of tongue-in-cheek approach to cover computing failure stories.
(My view on four-letter words such as the one used by this company is
that there are times when one desperately needs to use a four-letter
word, and that usage shouldn't be cheapened by using them willy-nilly
in totally inappropriate contexts). Even this latter web site is up
for sale, so it's hard to tell how much failure will be left in the
web failure world by this time next year!
So there you have it. Chaos-cum-crisis
that veers back toward success. Riches-to-rags-trends that revert back
toward riches. We live in interesting times (that constitutes an old
Chinese curse, as you no doubt know!) And they're getting more
interesting all the time.
About the author
Robert
L. Glass is president
of Computing Trends, publishers of the Software Practitioner. He has
been active in the field of computing and software for over 45 years,
largely in industry (1954 – 1982 and 1988 – present), but also as
an academic (1982 – 1988). He is the author of over 20 books and 70
papers on computing subjects, editor of Elsevier's Journal of Systems
and Software, and a columnist for several periodicals including Communications
of the ACM (the "Practical Programmer" column) and
IEEE Software ("The Loyal Opposition"). He was for 15
years a lecturer for the ACM, and was named a Fellow of that society
in 1998. He received an honorary Ph.D. from Linkoping University in
Sweden in 1995. He describes himself by saying "My head is in the
academic world of computing, but my heart is in its practice."
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