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Software Project Risks

Can you give me an example of risk management in the software industry?

Software and Risk

·      Considering the rate of failure in the software project industry

·         You would expect risk management to be more advanced

·      One way to reduce risk, and cost

·         Is to adopt commercial off-the-shelf software

·         Known as COTS for short

·      However, few COTS products fit requirements exactly

·         Some customization is necessary

·         Making risk management an essential activity

Adopting COTS products

·      Using COTS software

·         Decreases some risks

·         Such as will our purpose-built solution work?

·         But increases others

·         Such as will the COTS software work for us and in our environment?

·      As always with project risk management

·         The objective is to

·         Identify, track, manage and mitigate those risks

Customer Satisfaction

·      The risks must be established

·         Within the context of the customer's organization

·      The problem with COTS software is

·         Compromises must be made

·         Which may or may not be acceptable to the users

·         Hence, a close working relationship with the customer and the actual users is essential

·      The following slides suggest some technical risk issues to consider

Technical Risks - 1

The following are both positive and negative

·         When comparing COTS versus fully custom-built software

·         Using COTS software makes for easier and surer project estimating

·         Depending on the ratio between COTS and custom building

·         Rapid prototyping is easier with COTS software

·         To test the proposed system's concept and usability

·         It can also be done earlier in the software development cycle

·         When alternative approaches can also be compared

Technical Risks - 2

·         So, in general, a COTS solution is much cheaper

·         Because a lot of the development and testing work has been done

·         And the product should be available sooner

·         While successful commercial software requires less testing

·         Compared to all-custom built products

·         Integrating several such products requires more testing

·         COTS software usually has support available

·         But coordinating multiple sources complicates maintenance and support

·         And may stretch beyond the support available

Technical Risks - 3

·         Successful commercial software provides a de facto standard

·         Reducing risk of user rejection of the interface

·         But the customer is at the mercy of the COTS software supplier

·         And every upgrade that comes along

·         And consequent rework and testing every time

·         Worse, if the supplier abandons support

·         The customer is left with a legacy application

·         Controlling the technology is also difficult

·         Especially if proprietary protection is a concern

Customer risk issues - 1

Specific risk issues for the customer to consider

·         Staff's comfort and stress level

·         Especially if the interface is unfamiliar

·         Performance evaluation and incentives

·         The new software/system may require less qualified people

·         People's jobs and job security

·         Especially in the systems department

Customer risk issues - 2

·         Training and education effort

·         Changing the demands on the personnel department

·         Organizational changes

·         Leading to changes in the management structure

·         Managerial power and influence

·         That may be lost or gained

Summary - 1

Benefits of the COTS approach

·         More sources

·         Better quality

·         Newer technology

·         Cheaper implementations

·         Faster availability

·         Easier interconnection

Summary - 2

Disadvantages of the COTS approach

·         Exactly the right solution may be elusive

·         The COTS product may be subject to changes

·         Driven by other users

·         Or market forces

·         A newer and better product arrives

·         That essentially serves the same purpose

·         But requires a reworking of the custom system

·         Shelf-life is typically limited

·         And product support is abandoned by the supplier