Latest Standish Group CHAOS Report Shows Project Success Rates Have Improved by 50%

Business Wire, March 25, 2003

Business Editors/High-Tech Writers

WEST YARMOUTH, Mass.--(BUSINESS WIRE)--March 25, 2003

The Standish Group International, Inc. announces the availability of its renowned CHAOS research study for 2003. The study has commenced every two years since 1994 with data having been accumulated from a major survey on project success and failure. The latest batch provides insight into 13,522 Information Technology projects. The 2003 CHAOS Chronicles report shows some major improvements since the first CHAOS report.

Project success rates have increased to just over a third or 34% of all projects. This is a 100% plus improvement over the 16% rate in 1994. Project failures have declined to 15% of all projects, which is more than half the 31% in 1994. Challenged projects account for the remaining 51%.

Showing further improvements, fifty-one percent of challenged projects have a lower overrun ratio than in 2000. In fact, forty-six percent of this fifty-one percent had a cost overrun of less than 20% of the estimate. This is a 5% increase over the 2000 numbers and a three-fold increase since 1994. This was a major contributor to our estimate of a 43% average overrun cost, down from 180% in 1994. The lost dollar value for US projects in 2002 is estimated at $38 billion with another $17 billion in cost overruns for a total project waste of $55 billion against $255 billion in project spending. In 1994, The Standish Group estimated US IT projects had a waste of $140 billion ($80 billion in failed projects) against $250 billion in project spending.

However the report does not show all good news. Time overruns have significantly increased to 82% from a low of 63% in the year 2000. In addition, this year's research shows only 52% of required features and functions make it to the released product. This compares with 67% in the year 2000.

About The Standish Group

The Standish Group International, Inc. is a research advisory firm built on a solid foundation of primary research techniques. Through proactive advice, case-based reasoning tools and monthly statistical deliverables Standish delivers custom research services for the cost of a general research service. Founded in 1989, Standish is headquartered in West Yarmouth, Massachusetts. For more information, visit www.standishgroup.com.