UK in-house IT projects plagued by delays & cost overruns

New research suggests that the majority of in-house IT projects in the UK are not completed on time or within budget, with many ultimately being abandoned. Findings indicate that UK businesses are continuing to invest significant resources in building their own solutions, but often face ongoing challenges in delivery, efficiency, and compliance.

Abandonment rates

Data from a survey of over 2,000 IT and security leaders shows that 71% of in-house IT builds are eventually abandoned. The rate increases to 83% in highly regulated industries, such as finance and manufacturing. The research highlights a persistent problem with DIY IT solutions, as complexity and compliance needs make them more challenging to sustain in these sectors.

UK challenges

The UK-specific findings reveal notable difficulties in project delivery. Only 11% of in-house builds in the UK are finished on time. Nearly nine in ten projects miss their deadlines, which ties up both engineering resources and budgets for longer than anticipated. Budget overruns are common: 84% of UK builds exceed allocated costs, significantly impacting return on investment.

One in three UK teams favour internal builds to address compliance and data-residency requirements, indicating that regulatory obligations are a stronger driver than other factors. Despite this focus on compliance, the research suggests that success is still elusive for many teams.

Resource and financial drain

The report outlines the ongoing maintenance burden associated with internal solutions. Around 63% of IT teams spend between 10 and 50 hours every month maintaining these tools, with two-thirds requiring an additional USD $20,000 to USD $100,000 per year to keep them operating. Security and compliance risks remain significant: 64% of organisations have suffered downtime related to security, and 31% cite compliance or data protection as ongoing challenges.

Security perceptions

Security considerations are shaping decisions on whether to build or buy IT tools. In the UK, 51% of IT leaders believe third-party providers offer better protection compared to in-house solutions. In the US, sentiment differs, with 59% of leaders expressing greater confidence in systems built internally. Despite these differences in perception, downtime remains a commonly reported issue in both regions.

Performance gaps

The research reveals that efficiency gains from in-house development are often illusory. Although nearly half of IT teams continue to prefer building their own tools, only 8% of such projects are completed on time and just 11% stay within budget. More than half of internal builds take one and a half to two times longer than planned, while almost half end up costing nearly twice the original budget.

Vendor shift

The analysis identifies a growing shift towards specialist vendors, as organisations weigh the factors of speed, cost, and expertise. The findings show that speed (30%), access to expertise (29%), and reliability (28%) are leading reasons for buying rather than building IT solutions. The trend suggests that efficiency and predictability are now prioritised over maintaining direct control via custom builds.

UK teams cite compliance and control as main motivators for moving towards specialist vendors, a response to increasing regulatory pressure. US teams, while initially motivated by speed, indicate that vendor partnerships are now also attractive for scalability and a reduction in maintenance demands.

Industry insight

"We commissioned this report to bring clarity to a question every IT leader faces: do you build, or do you buy? The data shows that while building in-house can feel like control, it often comes at the expense of time, security, and scalability. At Exclaimer, we've seen how easily operational burden creeps in when IT teams are forced to maintain tools that were never meant to scale. This research helps organisations see the full picture, that true efficiency isn't about owning every line of code, but freeing teams to focus on growth and innovation," said Paul Hammond, Chief Product & Technology Officer, Exclaimer.