The final damnation of the BBC's £100m digital disaster and some tips for others

Profile picture for user slauchlan By Stuart Lauchlan April 9, 2014
Summary:
The BBC’s abortive Digital Media Initiative (DMI) may well be dead, but it won’t stay lying down as this week legislators in the UK Parliament slammed the state broadcaster in the strongest possible terms for its £100 million digital disaster.

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The BBC’s abortive Digital Media Initiative (DMI) may well be dead, but it won’t stay lying down as this week legislators in the UK Parliament slammed the state broadcaster in the strongest possible terms for its £100 million digital disaster.

We’ve covered the basics of this story before several times. DMI was an ambitious - ridiculously over-ambitious as it turns out - effort to deliver new technology for BBC staff to create, share and manage video and audio content, and programmes from their desktops.

The BBC originally contracted Siemens in February 2008 to build the DMI system but the contract was terminated by mutual agreement in July 2009 after which the BBC brought it in-house, predicting that in-house delivery would cost £133.6 million and generate £97.9 million in benefits.

The BBC cancelled the project last year but not before blowing close to £100 million of taxpayers money (in the form of the compulsory license fee payment from all TV set owners) on an initiative which has become a benchmark against which public sector project management incompetence will be measured for many years to come.

Since the scheme was cancelled, the BBC has flung itself into a public display of ‘mea culpa’ and commissioned PricewaterhouseCoopers to conduct an investigation into what had gone wrong at a cost of £250,000. This was followed by the National Audit Office (NAO) laying into the DMI failure in its own report.

Hodge rising

This week it was the turn of the House of Commons Public Accounts Committee (PAC) to weigh on the scale of the ineptitude behind the collapse of the project. The PC chairman, the fearsome Margaret Hodge MP stormed:

“The BBC’s Digital Media Initiative was a complete failure. Licence fee payers paid nearly £100 million for this supposedly essential system but got virtually nothing in return.”

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Dot Branning's heard the news

Criticising the BBC’s senior management for their complacency as the project fell apart, Hodge also criticised the fact that when BBC managers faced the PAC in January 2011, they did not supply “important evidence” in the form of a 2010 report from Accenture about the DMI, which “contributed to our false impression of the progress by DMI”.

Hodge said:

“When my committee examined the DMI’s progress in February 2011, the BBC told us that the DMI was 'an absolutely essential have to have’ and that a lot of the BBC’s future was tied up in the successful delivery of the DMI.

“The BBC also told us that it was using the DMI to make many programmes and was on track to complete the system in 2011 with no further delays. This turned out not to be the case.

“The BBC was far too complacent about the high risks involved in taking it in-house. No individual had overall responsibility or accountability for delivering the DMI, or took ownership of problems when they arose.”

The report by the PAC catalogs a long line of failures and embarrassing statistics:

  • The only part of the DMI to be delivered has just 163 regular users and costs £3 million a year to run.
  • The Infax tape-based system it replaced cost £700,000 a year to run.
  • The BBC admits that the new archive database is 'clunky', difficult to use and takes around ten times longer to use than Infax.
  • Just one show, Bang Goes the Theory, has ever been made using the DMI database.

So a failure all round.

Lessons learned etc etc etc

But as ever the organization left standing in the ashes pledges to have learned valuable lessons from pouring public money down a techno-drain and promises that it won’t happen again.

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Even the Doctor can't fix the DMI

So it is that the BBC promises “crystal clear accountability” from here on.

A spokeswoman for the BBC Trust, the corporation's governing body, said:

"As we have said before, this represented an unacceptable loss to licence fee payers.

"Acting on the conclusions of previous reports into DMI, we have strengthened reporting to the Trust so that problems are spotted early and dealt with quickly.

"We are also carrying out follow up reviews once projects are completed to make sure the lessons from DMI are being implemented."

The BBC has yet to outline in detail exactly what changes have been put in place. But the PAC has helpfully provided the broadcaster with its own clear suggestions. Some are BBC specific, but most are highly applicable to any organization embarking on an ambitious digital transformation project:

  • The BBC should ensure that governance and assurance arrangements match the scale, strategic importance and risk profile of its major programmes and projects.
  • Projects like the DMI need to be led by an experienced senior responsible owner who has the skills, authority and determination to achieve transformational change, and who sees the project through to successful implementation.
  • In its reporting on major projects, the BBC needs to use clear milestones that give the Executive and the Trust an unambiguous and accurate account of progress and any problems.
  • The BBC Executive should apply more rigorous and timely scrutiny to its major projects to limit potential losses that will ultimately fall on licence fee payers.
  • The BBC Trust should set out in response to this report what changes it will make to be more proactive in chasing and challenging the BBC Executive's performance in delivering major projects, so that it can properly protect the licence fee payers' interest.
  • The BBC Executive should report back to us on which of its original requirements for the DMI are still essential, how and when it will meet them, and at what cost.

Verdict

For the BBC, this is the final digging up of the DMI.

Everyone’s had their shout now and everyone’s said the same thing: a textbook example of how not to manage a massive digital transformation programme.

The lessons the BBC has learned the hard way should be pored over by any organisation to ensure that its own project management skills are up to scratch.

Meanwhile as a license fee payer, I'm mightily hacked off about how few - and which - heads have rolled over this.

But as that's still subject to ongoing legal process, I'll leave that for another time.