IT Risk Measured.

• Position: Brief Article

It may not shock you to learn that 84 percent of a group of surveyed financial executives said that information technology projects they had been associated with ran over budget or failed. But more than 20 percent of that group said they routinely budget at least a 26 percent contingency to cover potential overruns.

The findings were developed from a polling at the FEI Summit in May by Gladwyne Software Surety, a King of Prussia, Pa,, firm that has developed a methodology for measuring IT risk and offering insurance against overruns. Gladwyne, which became an FEI associate partner this past spring, compiled more than 200 responses from conference attendees. The results of several key questions follows.

Q. On a strategic information technology project, what contingency do you build into your IT services budget for anticipated cost overruns?

1. 0% to 10% 28.8% (of responses)

2. 11% to 25% 50%

3. 26% to 50% 154%

4. 51% to 100% 3.8%

5. 101% or more 1.9%

   Q. Which aspect of your business is impacted most by an IT project failure?

1. Customer/supply chain relationships 45.2%

2. Employee effectiveness and stability 21.2%

3. Financial performance 16.3%

4. Competitive position 11.5%

5. Time to market 5.8%

   Q...