Software disasters are often people problems

Big software projects -- whether to manage supply chains, handle payroll, track inventory, prepare finances -- tend to begin with high expectations and the best intentions. They're all about efficiency, reliability, cost-savings, competitiveness.

Companies might develop their own programs internally, outsource the job or buy from a company such as SAP AG, Oracle Corp. or PeopleSoft Inc. Regardless of the route, it's usually a major undertaking to get things right. Often, however, the first step toward total disaster is taken before the first line of code is drawn up. Organizations must map out exactly how they do business, refining procedures along the way. All this must be clearly explained to a project's technical team.

"The risk associated with these projects is not around software but is around the actual business process redesign that takes place," said Bill Wohl, an SAP spokesman. "These projects require very strong executive leadership, very talented consulting resources and a very focused effort if the project is to be successful and not disruptive."

A 2002 study commissioned by the National Institute of Standards and Technology found software bugs cost the U.S. economy about $59.5 billion (euro48.35 billion) annually. The same study found that more than a third of that cost -- about $22.2 billion (euro18.04 billion) -- could be eliminated by improving testing.