A WHITE ELEPHANT IS NOT A BLACK SWAN: WHY YOU CAN DO MORE ABOUT IT PROJECT RISK THAN YOU THINK (A REPLY TO FLYVBERG AND BUDZIER)

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Abstract

Failed IT projects destroy value on a massive scale. Failure occurs because traditional efforts to improve IT performance treat project delivery as an operational endeavor driven by technologists. Progress, these technologists say, lies in ever more complex implementation methodologies. In reality,
an IT project is a business endeavor which must be evaluated in financial terms, both as a standalone effort and in relation to other efforts competing for resources. Moreover, a client or vendor’s projects represent a rolling collection of endeavors. They are best analyzed and managed as a portfolio. Proof of success will not only come through better project delivery and business ROI but the ability to insure IT projects for timeliness, adherence to budget, and full functionality.

Keywords: Risk Governance, Public Sectors, Insurance, Asymmetric Information, Moral Hazard and Adverse Selection, Econometric, Actuarial and Statistical Methodology

How to cite this paper: Zafft, R. (2012). A white elephant is not a black swan: Why you can do more about it project risk than you think (a reply to flyvberg and budzier). Risk Governance and Control: Financial Markets & Institutions, 2(3), 54-63. https://doi.org/10.22495/10.22495/rgcv2i3art4