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

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 perspectives – the 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.