Nearly half of the UK's largest companies suffered a failed IT project over the past three years, according to research.

A hefty 40 per cent of businesses experienced project failure between 2004 and 2006, according to consultant Avanade. Poor system specification was the largest cause of problems, contributing to 66 per cent of cases.

A lack of understanding between IT and business departments was blamed in 51 per cent of failures, while 49 per cent cited technology selection as a factor.

But only 28 per cent of companies said they measure the success of their IT projects after implementation. This lack of analysis is depriving UK companies of cost-saving feedback, said Avanade director of enterprise service solutions Brent Kronenberg.

'Businesses clearly understand the value of IT as they are willing to spend money on developing and updating their IT systems, but organisations are failing to receive the business benefits that the investment promised,' he said.

'Cost-implementation assessments will enable companies to achieve optimum levels of performance, so they can see a real return on their investments.'

Avanade interviewed IT and operations managers from 102 companies, each supporting over 10,000 users.