Australia's worst-ever IT Project Failure?

On October 12th, one day after the October IT Governance Letter was published, Australia experienced an IT project failure of potentially catastrophic proportions.  The Australian Customs Service introduced the Imports Module of the Integrated Cargo System, bringing to a climax its multi-year program of re-engineering the way imports and exports are handled.

Within a few days, Australia's sea and air cargo terminals were choked with unprocessed imports.  But it took two weeks for the disaster to be acknowledged to the extent that Customs allowed importers to revert to the old system indefinitely.

The damage caused by this project will be immense, and perhaps incalculable.  Already, the federal government has moved to change management of Australian Customs, with the appointment announced on November 10 of Tax Commissioner Michael Carmody to the top post.  But the real consequences are not in the public service.  Delays in import deliveries have hurt importers, transport firms, customs agents, retailers, manufacturers and probably many others.  They have carried extra costs, they have lost sales, and in some cases, the damage may be terminal.

How could such a catastrophe have developed?  We spent all our spare time over the last month pondering this question.  We worked through our news archives, and found mountains of material covering the Customs Cargo Management Re-engineering Project spanning two years.  As we put the pieces together in sequence, it became obvious to us that the October Imports Debacle was as predictable as the crowd at the Melbourne Cup.

So we wrote a story about it.  For those who like to have it on a page - we're sorry.  There is a single sentence version, which reads: "If you don’t ensure that ALL the conditions for success are satisfied, your project will fail and no amount of spin will change that reality!"  It's ten pages, packaged conveniently in a PDF, and, according to our reviewers, it's "a compelling read".  One said: "Wow - I was aware of each article, but seeing them all together in one paper is stunning".

Click here to read the first page summary.  Click here to read the whole paper.

Infonomics believes that catastrophes such as this should be avoided by effective corporate governance of IT.  The news gives us some insight to the potential omissions in governance.  Only a formal investigation will reveal the extent of governance failure.  We hope that the investigation starts soon, is fully transparent, and that we are involved. 

Do your IT projects have any of the characteristics of the Customs project?  Should you check?  Why not ask us how you can find out quickly?

Do you have something to say about Customs, or about IT Governance in general?  Tell us, and we will publish your views in the next IT Governance Letter, due for release on December 12th.