for Vendors. Pete Swabey on InformationAdvantage explains:
The number of IT projects that end in failure is staggering. According to a 2007 study by researcher Market Dynamics, 62% of all IT projects miss their deadlines, 49% go over budget and 41% fail to deliver the benefits that were expected. That is worrying enough for IT departments.
But for consultants and software vendors, keenly aware that project failure could well result in litigation, it is a constant concern. It is that concern that specialist insurer Hiscox addresses with its offering to IT vendors, insuring them against being sued by their customers. And it is a genuine danger. Stephen Wares, UK manager of Hiscox’s IT practice, tells of a small software development company with a turnover of £5 million that was sued for £18 million for the alleged failure of a project (the suit was eventually unsuccessful).
And the reasons he tells about are so well-know: bad specifications, overselling in the sales pitch, lax or non-existent change management.