PracticePeople In PracticeBusiness paying over the odds for IT

Business paying over the odds for IT

Poor management of software projects mean some businesses are paying as much as seven times more than others for identical software applications, according to a study published last week.

Banks, insurance companies and large government departments paid the most for software projects, according to an analysis of software development projects by the International Software Benchmarking Standards Group (ISBSG).

According to the ISBSG, costs spiralled in sectors using large, old legacy systems with complex architectures. The conclusions were reached by the ISBSG after an analysis of its database of 789 development projects in 20 countries which it has compiled over the last 10 years.

Tony Rollo, of the UK Software Metrics Association, which co-ordinates ISBSG’s activities in the UK, said the study highlighted the need to improve poor software engineering practices which lay behind the inflated costs some users were paying.

‘The discrepancy between what some software projects cost and what others cost is down to inefficient development. A lot depends on the quality of the development environment,’ said Rollo.

Terry Wright, chairman at the ISBSG, said: ‘Organisations can dramatically cut their software costs, reduce time-to-market, obtain a new level of certainty in software development estimation and ensure value-for-money when outsourcing.’

However, some experts were sceptical about the conclusions reached by the study. Phil Payne, of independent analysts Isham Research, said the cost of software projects was more complex than the choice of platform.

‘Software projects involving green field sites are always cheaper and the cost of a project is not a platform question. Direct Line had a very successful project and it used mainframes.’

John Higgins, director general of the Computing Services and Software Association, said the most important difference in the cost of using similar packages for different users is licensing issues. This is because licences can be more expensive in certain configurations.

This article first appeared on vnunet.com

Software Metrics Association

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