Fixing the Payment System at Alvalade XXI: A Case on IT project Risk Management

This case describes the implementation and subsequent failure of an innovative system installed in the bars of Alvalade XXI, the recently built football stadium in Lisbon, Portugal. Casa XXI, the company running the bars, had entrusted the project to an IT supplier who had limited experience with large systems. During the inauguration, the system failed spectacularly creating a chaotic situation. The fiasco meant not only a financial loss, but also a blow to the reputation of the company. The management blamed the supplier for the failure. The supplier, however, claimed that the problem was not technical but organizational, that is, poor planning of operations. Subsequent tests were inconclusive and failed to restore trust. At the end of the case, the CEO is considering the possibility to switch to an alternative supplier. He also wonders what they could have done to manage the project and the associated risks more effectively. The case highlights risk and project management issues in large systems implementations. The discussion can be structured around cost/benefit analysis, risk assessment, and project management. Relevant dimensions include: company operations, project scope, degree of innovation, technology used, system architecture, supplier selection, and project organization. In addition, the case raises governance questions: Who is responsible for the project? Even if the project is outsourced, how should the roles and responsibilities be apportioned between the company and the IT supplier(s)? What mechanisms should be used to plan and execute IT projects, and control their risks?