Detection of early warning signals for overruns in IS projects: linguistic analysis of business case language

Abstract

Many Information Systems (IS) projects fail to be completed within budget and on schedule. A contributing factor is the so-called planning fallacy in which people tend to underestimate the resources required to complete a project. In this paper, we propose that signals of the planning fallacy can be detected in a project's business case. We investigated whether language usage in business cases can serve as an early warning signal for overruns in IS projects. Drawing on two theoretical perspectivesthe Linguistic Category Model (LCM) and Construal Level Theory (CLT)two sets of rival hypotheses were tested concerning the relationship between project overruns and whether the language usage in a business case is abstract or concrete. A linguistic analysis of the business cases of large IS projects in the Netherlands suggests that concrete language usage in the business case is associated with bigger budget and schedule overruns. For researchers, our study contributes to the existing literature on the importance of language usage. For practitioners, our study provides an early warning indicator for overruns.

Salient Complexities of Engaging External Consultants in Information Systems Projects

“…Information systems (IS) serve a key competitive, operational and strategic role in most organisations [1] [2]. However, despite its importance, the development, implementation and exploitation of IS within organisations remains problematic and has been fraught with failure [3], abandonment [4], escalations [5] and overruns [6]. Seeking to stem the high failure rates of their projects, many organisations have sought to engage consultants [7] [8] [9] [10] [11] [12].…”

The rationality of human behaviour and accuracy in information technology management

“…Some claimed that business cases were seen as being inherently deceptive, and that in situations their creation was obligatory, there was a willingness to purposefully produce a business case that appeared to be untrustworthy. Despite these prevailing opinions, business cases are commonly used in IT management to support gate decisions (Benschop et al [2020]; Berghout and Tan [2013]). One possible reason for their widespread usage could be the fact that business cases are likely more accurate than human intuition when it comes to financial value, even in circumstances where they are wrong (Ward et al [2007a]).…”

“…Business cases normally comprise estimations of the project cost, the post-project cost and the financial benefits (Keen [2012]). It is well recognised that project costs are not easy to estimate (Benschop et al [2020]; Flyvbjerg et al [2022]). Fewer insights are shared on the accuracy of completed business cases.…”

“…Sometimes, organisational changes can only be attributed indirectly to the behaviour of an individual agent. For example, IS projects with concrete language usage in their business cases are more associated with bigger budgets and schedule overruns than projects with business cases described in more abstract language (Benschop et al [2020]). Organisational agents wrote these business cases and the output of that behaviour is used as an indicator for budget and schedule overruns.…”

“…Additional components influencing the behaviour of organisational agents in IT management, not present in C ¸elik and Uslu [2023], such as culture, social presence, digital mindset, consultation, and overcoming anomalies and restrictions, were found in this SLR (Akhlaghpour and Lapointe [2018]; Elifoglu et al [2018]; Hanus et al [2022]; Mallmann and Mac ¸ada [2018]; ; Pinto et al [2018]; Raghavan et al [2020]; Solberg et al [2020]; Ylinen [2021]; Wiesb öck and Hess [2020]). The financial impact of managing IT as a factor in influencing human behaviour was studied by Benschop et al [2020], Flyvbjerg et al [2022] and Zong and Wang [2022].…”