Slashdot Mirror

← Back to Stories (view on slashdot.org)

BSkyB Wins £709m Lawsuit Against HP-EDS

Posted by kdawson on from the pants-on-fire dept.

E5Rebel writes "In a massive legal case in the UK, HP-EDS has been found guilty of 'fraudulent misrepresentation' by their sales team when winning a major CRM project. Settlement could cost £200M out of an initial claim for £700M. HP's only relief was that parts of the claim were dismissed, but the core claim was upheld. HP is likely to appeal. Outsourcing will never be the same again. HP workers have been on strike against pay cuts last week; no doubt management will try and screw them further to pay for this debacle."

41 of 187 comments (clear)

  1. Overstated. by Itninja · · Score: 2, Insightful

    The summary: "Outsourcing will never be the same again."

    TFA: "Nigel Roxburgh, research director at the National Outsourcing Association, previously told Computerworld UK that if the case is upheld in favour of BSkyB, "it could lead to a real scratching of heads, particularly among lawyers."

    --
    I judt got a nre Kinesis keybiartf so please excusr ant egregiou typos.
    1. Re:Overstated. by machine321 · · Score: 2, Funny

      it could lead to a real scratching of heads, particularly among lawyers."

      At least they've been practicing scratching the other end.

      Sorry, I mean practising.

    2. Re:Overstated. by reebmmm · · Score: 5, Informative

      IAAL. I work with technology contracts. I think that the only reason a lawyer will be scratching his head is because of the genuine unlikelihood that the customer could actually prove a fraud case against a vendor. That's not to say it's impossible, just so unlikely. What's clear is that this was not a contract case. If it was merely a contract case, it would have looked to the four corners of the agreement. The plaintiffs (the customer) had to work extra hard (i.e., $40M in legal fees hard) to prove the fraud.

      Customer-clients regularly come to me with contracts that have:
      1. no objective criteria to measure success/failure
      2. all of the liability for delays, failure to perform, etc. allocated to the Customer
      3. do not have sufficient input from the technical people that will actually be working on the project.
      4. no contractual remedies for failure.
      5. no change management process.

      Point #1 is the most important. In this case, if there were objective criteria to measure success, then the breach of contract case is simple to prove. It is like engaging in the design/plan phase of development before you even sign the contract. If a customer can't figure out what objective criteria it needs, it's probably not a good time to enter a $40M contract. Take for example, the objective criteria that the EDS software will meet the minimum process per second with 150 active users. Easy, does it do? If not, see points 2 and 4.

      Point #2 is often overlooked. Customers regularly sign contracts that permit a vendor to deliver something non-conforming on the delivery date and not be in breach. The contracts are also usually written so that the additional time spent correcting the non-conforming deliverables are paid by the Customer. These are usually sneakily inserted under the "right to cure" a breach provision. At some point, the vendor (not the customer) should be paying.

      Point #3 is necessary in order to establish point #1 and point #2. Management has this idea: oh we need ___ system. Let's find a vendor of ___ system. However, it is the technical people that need to set the objective criteria and then be able to test that it was met.

      Point #4 is the stick with which you beat the Vendor into meeting those requirements. Every customer should be asking, "what happens if they don't deliver?" I say, "show me the money." Of course, you can customize however you see fit. Customers however don't usually ask.

      Finally, point #5 is so painful its hard to write about. A lot of time and money is lost because the customer does not have a good internal change management process. In addition, the customer does not put that change management process in writing with the vendor. Any change management process should be coordinated through a project manager. The process should require 1. estimates of cost and 2. affect on time line. These should require signature of someone higher up the chain than the project manager if there is a big impact on price or time--what constitutes a "big impact" should be spelled out (e.g., more than $10,000 or more than a 1 week).

      As a last tidbit: technology people need to STOP SIGNING AGREEMENTS WITHOUT A REAL LEGAL REVIEW. This includes the stupid little EULAs that you click ok to. That includes the purchase of off the shelf software. That includes signing up a third party for professional services. Those words mean things. Spending $1-3K now saves a boat load on the backend.

  2. Stupid Ads in TFA by Amasuriel · · Score: 2, Insightful

    From TFA:

    Amanda Bucklow at mediation firm In Place Of Strife said that even “a long and extraordinary mediation process would have taken only a few days and cost a lot less” than the legal fees spent by both parties.

    And now breaking news! Random person trying to sell you some services thinks you should buy their services!

  3. SAP by 16K+Ram+Pack · · Score: 3, Insightful

    Somewhat off topic, but perhaps related to the topic:

    Has anyone ever worked in a company where they had a SAP implementation where overall the users and management (and I don't mean snr management who are above it) are actually happy with the outcome?

    1. Re:SAP by BlueBoxSW.com · · Score: 4, Insightful

      There was a slashdot article awhile back about an SAP implementation at Waste Management that went bad.

      Similar situation to this one.

      I really think large companies buying these systems are going to start recording the sales presentations, burn them to DVD, and insist on including them in the contract.

      That way the sales representations BECOME part of the whole agreement, and are actionable.

    2. Re:SAP by cyberjock1980 · · Score: 4, Interesting

      When I was in the U.S. Navy I was lucky to be at a command that was a test platform for an SAP implementation for the Navy(ERP was the Navy name for it). When I was there, if you were a "power user", even if not a computer junkie, it was very easy to get a grip on the program and use it very effectively. Of course, we had alot of complaining by alot of older people that didn't like change (every group will have these people). The actual rolling out of the platform was painful, but once it was in and operating it was great.

      Our only issue was that we needed to be able to store classified "Confidential" information. This was information that was simply above public release, but below "Secret". Our procedures required certain safegards that were not easily implemented into SAP at the time. We had a plan to get it to work, but at a pretty significant cost.

      Googling I just found www.erp.navy.mil, so it looks like the Navy has started using it more broadly. As much money as the gov't dumps into crazy stuff, I would be the first to say SAP/ERP was money well spent! Just don't mention NMCI(Navy and Marine Corp Intranet).

  4. Outsourcing suxors, but ... by Anonymous Coward · · Score: 4, Insightful

    AC disclosure: I work for BSKYB, but not in CRM ... thank f**k.

    Yes, the CRM system has problems, and from a tech perspective I'd agree that it's not worth £48M (OMFG!). However, I think it's amazing that things got this far. If we're in a capitalist society then I also want this to be a meritocracy and I want someone in Sky to publicly take the blame for this 3rd party POS. Regardless of the internal or external software teams, it should never be allowed to degenerate to this level of incompetence.

  5. Re:Scope creep? by Espen · · Score: 3, Informative

    Confused much? EDS is HP. The customer was BskyB.

  6. Re:Scope creep? by curmudgeous · · Score: 4, Informative

    BSkyB was the client in this case, EDS was the company contracted to provide services. EDS has since been bought by HP and so HP is now on the hook for the EDS fubar.

  7. Re:Scope creep? by Sunshinerat · · Score: 2, Informative

    You are almost right.
    HP does not play a part in your conversation until 2008.
    EDS told BskyB that they would deliver a CRM system with golden monkeys, BskyB changed their idea for the system to blue unicorns.
    The whole delivery tanks, HP buys EDS in 2008 and gets the bill for another 900m pounds.

    --
    Load New Commander (Y/N)?
  8. If EDS has to tell the truth it is dead. by HornWumpus · · Score: 4, Insightful

    Has anybody ever heard of (or better yet been involved with) an EDS project that went well.

    Anyone?

    EDS is characterized by: lots of promises, no delivery, never saw the experts present during negotiations again, lots of low GPA recent college grads doing 'work' they are not qualified for.

    I don't know how EDS stays in business. Kickbacks to purchasing officers with no stake in the projects is my guess.

    --
    John McAfee 'It was like that time I hired that Bangkok prostitute; to do my taxes, while I fucked my accountant'
    1. Re:If EDS has to tell the truth it is dead. by Anonymous Coward · · Score: 3, Informative

      Although it's possible things have changed in the past decade, having worked for EDS as a new graduate, I take issue with your assertion. It's full of high GPA recent college grads, with a seriously over-inflated sense of their own competence, doing 'work' they are not qualified for, managed by people whose sole qualification is that they are the sub-set of that group who lacked the ambition to leave their employment in order to do something less pointless long enough to be promoted.

    2. Re:If EDS has to tell the truth it is dead. by Cederic · · Score: 2, Insightful

      lots of promises, no delivery, never saw the experts present during negotiations again, lots of low GPA recent college grads doing 'work' they are not qualified for.

      This hardly differentiates EDS from their competitors. :(

    3. Re:If EDS has to tell the truth it is dead. by rocker_wannabe · · Score: 4, Insightful

      Apparently you are not familiar with the Navy NMCI Contract with EDS. I haven't been following it lately (as in the last few years) but it had VERY overpriced systems on the contract and mostly hired people who didn't have much experience because they were cheap. That contract would keep even the worst managed company in gravy for quite a while. I don't know what most of the military guys thought about it but just ask any civilian employee for the Navy what they thought of NMCI and listen to the expletives fly.

      I'm not sure how any company can sell computer software or services without lying, even unintentionally. Anything worth bidding on by EDS is going to be complicated enough to keep them from knowing what they really have for a month at least.

      The worst part is if you're going to expect technology salesmen to tell the truth then you're going to eliminate at lot of material for the Dilbert comic strip, among others.

      --
      "Meaningless!, Meaningless!" says the Teacher. "Utterly meaningless!"
    4. Re:If EDS has to tell the truth it is dead. by asdf7890 · · Score: 2, Informative

      I don't know how EDS stays in business. Kickbacks to purchasing officers with no stake in the projects is my guess.

      Government contracts for one thing. Hardly anyone (or no one) else of notable size bids for them most of the time as they simply don't want to deal with the red tape and other hassle (taking part in a procurement process can be very expensive in terms of time and effort, especially for large projects, especially for governments), so EDS get some fairly lucrative contracts due to being the only real contender in the procurement process.

      I've worked alongside EDS (they managed the IT and other infrastructure for a company we did a pile of work for over the course of a few years) and I can tell you there are some very good people in there. A lot of chaff too, but that is the way of things (in a large organisation chaff that know they are chaff can hide behind others, and once found can be difficult to legally sack), and they often move at the speed of a snail with severe alcohol poisoning (again, this I saw as mainly a function of the size of the beast). I've never dealt with the sales or management teams though, so things could be very different up those parts. There did seem to be notable communication disconnects between some levels of management and the people doing the work (I can't comment on sales - I never had reason to deal with them at all).

    5. Re:If EDS has to tell the truth it is dead. by jhol13 · · Score: 2, Informative

      In Finland there is company called Tieto (formerly TietoEnator). The sole reason why it stays in business is size. It is almost the only big player in the field.
      No small company can compete with their claims.

      TietoEnator has horrible track record. Just to point two (of many):
      1. Parliament voting system. Took several years as the first(?) system was overloaded by the votes - maximum of 200. Yes two hundred votes (given within few seconds) overloaded the system, the tests showed pretty much random output. BTW, there are as many as three possible votes (yes, no, abstain).
      2. Car registry. Finland has 5.2 million inhabitants and less cars. Their system could not cope with the amount of updates to the database.

      The biggest problem is that the buyer, usually government, will happily extend the price to several times the original to get something working ... so it makes sense for the TietoEnator to put the least capable into the work.

    6. Re:If EDS has to tell the truth it is dead. by twiddlingbits · · Score: 2, Informative

      Having worked for EDS as Senior Technical Staff I can tell you that you EDS was greatly burdened with incompetent, underperforming, meddling middle managers who had nothing better to do but get in the way. HP has sacked most of that level. Technology wise EDS has a few very sharp good people, lots of good processes (commonl NOT followed), many hard workers who put in ungodly hours to try to fixing the mess the meddling managers created but seems to like to overcommit and underdeliver. They do a good job of things like hosting and infrastructure (in fact they host most of the airline reservations systems worldwide) but seem to stumble badly on new development work.

    7. Re:If EDS has to tell the truth it is dead. by dkleinsc · · Score: 2, Insightful

      The old saw that seems applicable here: The difference between a software salesman and a used car salesman is that the used car salesman knows he's lying.

      --
      I am officially gone from /. Long live http://www.soylentnews.com/
    8. Re:If EDS has to tell the truth it is dead. by afabbro · · Score: 2, Funny

      They do a good job of things like hosting and infrastructure (in fact they host most of the airline reservations systems worldwide)

      Hopefully you just chose a bad example ;-)

      --
      Advice: on VPS providers
  9. It's the relationship, stupid! by rickb928 · · Score: 2, Interesting

    I've done a lot of contract work, but nothing on the scale of a CRM install. Despite that, there are somem things that are the same, no matter the size of the job;

    - The relationship is key. If you don't forge a good relationship with your client, you will always suffer. Always.

    - If the relationship is good you can overcome any obstacle. Even total failure. Yes, even if your solution turns out to not work at all, you can work out the relationship.

    - Relationships are give-and-take. If you succeed wildly, you will get more and better. If you do fairly well, you get what is due. If you mostly fail, you work it out. Sometimes it doesn't work out, true. If you fail totally, well, you get what you deserve.

    - Importantly, don't get into a relationship you don't intend to actually work on, and don't have any real expectation of success. Someone on the engineering side of HP-EDS needed to tell the sales side 'we can't do all this'.

    - Most important, don't go into a relationship with a crazy partner. Sky may have violated this one. Money makes contractors crazy. Trust me on this. The more money, the crazier. Those of you who have real-life relationships with real-life people will find corollaries to this, and they are indeed true. You do not need to waste your 401K to learn this, ok? The tabloids will offer proof enough. Same thing in business. Almost the same process.

    --
    deleting the extra space after periods so i can stay relevant, yeah.
  10. Interesting implications by BigSlowTarget · · Score: 2, Insightful

    FTA it sounds like the salesmen lied and the contract didn't include the lies. The court found EDS liable for what the salesmen said (and prolifically emailed) rather than the signed contract. If that holds it's not outsourcing that will become difficult but selling many complex and high priced products. Each sales meeting could be a contract negotiation with legal implications as well as a demo or whatever. You sales guys might need to drag the lawyer to all your customer meetings going forward. Sales support would become a major pain as well.

  11. HP is run by greedy idiots by Anonymous Coward · · Score: 3, Interesting

    Being an HP/EDS employee myself, I can guarantee you that I will get screwed.
    They already cut my pay once by 5%(plus 15% for one month). After doing this, they also cut several employee's salaries in a "job code alignment", which was just a pay cut in disguise.
    This is before and after laying off hundreds of employees, replacing them with morons from India and Malaysia because they are "equally efficient but cheaper".
    On the bright side, our CEO make record income thanks to his salary/compensations and his tremendous bonus. Apparently flushing your company down the shitter puts you at the top of the bonus queue.
    HP/EDS is run by greedy morons, who outsource all the work to poor morons.
    I'm happy to have a job and I hope this whole event doesn't affect me(although I'm sure it will), but HP/EDS can suck it for all I care.

    1. Re:HP is run by greedy idiots by ledow · · Score: 3, Interesting

      Ha, I'm laughing at the "put food on the table" crowd. Putting food on the table is a day-to-day chore. Job satisfaction, a suitable home life, unstressed parents and most importantly JOB SECURITY are a million times more important in the long run. It's short-sighted to claim that you have to be completely disrepected as a person in order to feed your family. Baby doesn't care that dad's a road sweeper, or a baker, or an IT manager, so long as he's home after work, and happy, and that he'll *probably* have a job tomorrow.

      Working for companies that treat their employees like that is *not* security - security for today, maybe, but not for tomorrow. And the more you "suck it up" and "just deal with it" by continuing to work with employers that are *abusing* you as a human, the more they'll take you to the cleaners. And the more those employers will thrive and really not care about their employees at all. When do the companies stand up and listen and improve pay and conditions? When all their employees start to walk (and no, I'm not and never have been a member of any union, because I have a tendency to believe that other people are just as wet and short-sighted as some of the posters on this thread and I don't want them dictating what work / pay I'm limited to).

      Think I'm just mouthing off and haven't ever been in the position? Been there, done that, several times, with a wife, newborn, toddler, etc., with a mortgage to pay, bills everywhere, loan payments, and balancing a thousand other spinning plates. Every time that I got screwed (or sensed it coming), I moved onwards and upwards and got happier in my work (and higher-paid, but that's neither here nor there). One of those times was when my daughter was barely a month old and I walked from a job because they wanted to treat me like shit (they also thought that the *best* candidate for my replacement wasn't suitable because "He's been working at a supermarket for the last month" in the middle of a economic crisis... so f***ing what? He's working, when he could be sitting at home, and he has more than enough experience / skill to do the job). Call me an idiot if you want, but my daughter did not go without at any point and within a week I was working somewhere else for infinitely more respect and a little bit more money.

      I'm sorry, but I owe it to my family to keep my self-respect, to teach my daughter that I'm not a faceless, numbered drone, to come home healthy and happy, and if that means we eat bread and water rather than smoked salmon, so be it. And if a large company offering me huge wages for screwing other people over and / or a paycut that I haven't agreed to has to be told to stick their offer where the sun don't shine, I can, will and have done that (on both counts actually - I've turned down jobs that were handed to me on a plate purely because I didn't agree with how the company were making their sales).

      Your family need to be fed, but they also need to know that Daddy isn't a robot that can be stepped on by everyone around him. That's teaching your kids nothing but subservience to people with money, and they'll grow up to hate you or follow you in that path. Like any sensible parent, I want my kid to grow up to question things that are wrong, learn the value of money, the value of respect, and to do better at life than I have. In a modern, developed country, starvation is a *long* way off and, if you seek proper help, almost impossible. If it means a choice between giving up my mortgage and making me / my daughter unhappy, it's an easy choice. Sorry, but my daughter's respect for her father cannot be bought for any job, price or token gesture. And nothing buys my daughter's happiness except my own, and that can't be had by knowing I'm "only" putting food on the table.

      Live your corporate existence being abused and trodden on because there "aren't many jobs about". But it's not for me. I'll take my kid to the park rather than to a stadium, I'll show her how to cook masses of cheap soup instead of takeaways and restaurants, and I'll end up having more fun and gaining more respect in the process.

  12. Outsourcing by SimonTheSoundMan · · Score: 3, Informative

    Anyone know of any large outsourcing company that deliver what they promised, to a decent quality?

    Capita are another company that comes to mind. They have ripped off most public services in the UK with their poor products. Capita did a good job at ripping Birmingham City Council off with their new web site.

    1. Re:Outsourcing by Locke2005 · · Score: 2, Insightful

      What planet are you from?!? Everyone knows you don't get to be the lowest bidder on a project by giving the customer everything they want! All salesmen lie; the really good salesmen actually know when they are lying. If you didn't fully specify the list of deliverables, the acceptance criteria, and the liquidated damages for failing to meet the criteria was in the contract, then shame on you for signing that contract in the first place! Sure, if you're doing it in house or buying from somebody that gets paid by the hour, then you can incompletely specify and make changes later. But good luck doing that once somebody has agreed on a fixed price for the whole contract!

      --
      I've abandoned my search for truth; now I'm just looking for some useful delusions.
    2. Re:Outsourcing by 16K+Ram+Pack · · Score: 2, Interesting

      Anyone know of any large outsourcing company that deliver what they promised, to a decent quality?

      No. And I'd never in my life hire one.

      If you're a big company with a reasonably bespoke requirement for software which isn't going to die after a few months, then you should treat it as part of your company. I'm amazed when companies think they can treat their complex data like something as simple as business stationery or the car fleet.

      The one time it's worth going 3rd party is for highly specialised expertise or non-bespoke software.

  13. Re:I'm confused by ebcdic · · Score: 2, Insightful

    Presumably they incurred costs as a result of EDS not providing what they were supposed to.

    Sky and EDS - it couldn't happen to two nicer companies. With luck no-one will win except the lawyers.

  14. Re:Scope creep? by Horza66 · · Score: 5, Interesting

    I worked as an independent consultant at GM (run by EDS) and at Sky, cleaning up the mess they left behind.

    Firstly, on behalf of all the independent consultants and contractors at both sites let me say thank you to EDS. Thank you for our fees. Without your stunning incompetence all down the line none of this would have been possible.

    The reality at Sky:

      I joined a couple of years after EDS was slung out. Sky had a creaking legacy (green screen) customer installs system. They needed a comprehensive, fully architected CRM system capable of handling their millions of customers. EDS came in, did a brilliant sales demo, then sent in the drones. This is their standard operating procedure. They have smart people to call on - for sales calls. When it looked like they were about to get slung out of GM suddenly the kind of guys who wrote RFCs were all over the place. Once the attention was off they disappeared back to sales calls. This is how all outsourcing operations run.

    Sky discovered pretty quick that they were being handed a pos that could never scale to a multi-million customer operation. Pretty quick being after a couple of years of pointless development. After they ditched EDS things didn't really improve: every department (customer services, billing, actuarial, etc etc) chose a "best of breed" app (more like "best of sales demos" app) then spent years customising it to fit. Then a bunch of said indy contractors tried to integrate it all together. We did the best we could.

    Counting the bodies in the development halls, and allowing for what Sky had to pay to get people to work in Livingston (Detroit was comparable, if rather bigger) I'd estimate their costs at £50+ Million a year over rather more than five years. This settlement would put a big dent in that, but it certainly won't cover the cost of EDS's truly monumental incompetence.

    Coda:

    Between the GM and Sky gigs I had a drink with Compaq's top salesman in Toronto. I related the disasters at GM for amusement value, only for him to express his undying affection and admiration for EDS. What goes, I asked, for there was a twinkle in his eye. He explained thusly.

    EDS would come to him for a quote for 10,000 PCs in their upgrade cycle for a major client. Said salesman would provide a quote for top of the line PCs at below cost price. A massive loss for Compaq. He would put this deal on paper, fully specced, and pass it across the desk for signatures.

    *Three years later* EDS would come back with the sign-off and a purchase order. Compaq would give them 10,000 of the dregs of the warehouse. They would all surpass the three-year-old spec in the contract. Massive profit for Compaq.

    I imagine the salesman made a pretty decent bonus too.

  15. Re:No comment... by Anonymous Coward · · Score: 3, Insightful

    If your employer's finances are so bad that not working 1-2 months of unpaid overtime will bankrupt them, I advise that you start looking for another job.

  16. Re:Scope creep? by b4dc0d3r · · Score: 2, Informative

    Not sure you read the article. HP completed purchase of EDS after the trial ended, so the only thing HP has to do with this lawsuit is it owns the losing party, which it didn't during the contract. The judgement took 17 months to reach from the end of the trial in July 2008. So the trial ended, and the judge sat around meditating for 17 months, and HP bought EDS.

    EDS did not want some sort of CRM, BSkyB did. EDS is an outsourcing company (was, now it's part of HP) and would provide CRM, not purchase it. EDS, now owned by HP, had fraudulently misrepresented itself in a sales pitch in 2000 for the system

    It's more likely that EDS promised some sort of a system, and BSkyB led EDS around through as you said scope creep. EDS thinks it upheld its end of the bargain, BSkyB thinks its requests were within reason. Of course, I don't know the details of the contract, nor any more specifics than what's in the article, but your version is completely wrong.

  17. Re:Scope creep? by mgblst · · Score: 2, Interesting

    Yeah sure, despite your obvious confusion, you are still wrong. You are only looking at one side.

    The other side is that HP/EDS (the same company), over promised on what they could deliver to Sky.

    Both are common problems in outsourcing, both are equally likely to be true. In this case, according to the judgement and HP, it seems to be that EDS overpromised more than scope creep occured.

  18. Re:F |_| C K EDS by BitZtream · · Score: 2, Funny

    You realize that we're adults and that you're retarded use of ascii isn't required since no one cares if you say 'fuck' right?

    As for their employees, it sounds like they fucked up enough on their own and are too stupid to get a job anywhere else.

    Its funny that you talk about 'screwing over the employees' when ... well, they just lost the company 200m

    --
    Persistent Volume manager for Kubernetes - https://github.com/dwimsey/openshift-pvmanager
  19. Re:No comment... by asdf7890 · · Score: 2, Interesting

    If your employer's finances are so bad that not working 1-2 months of unpaid overtime will bankrupt them, I advise that you start looking for another job.

    While most economies are starting to recover from recent event, decent well paying jobs are still thin on the ground. He may well be looking for alternative employment while working the current job. No point going until you've got somewhere to go to...

  20. Re:Douche bag editoral summary by HornWumpus · · Score: 2, Insightful

    When a fuckwit sales team promises the impossible they have given you license to not work.

    The outcome is inevitable. As you state it's an 'impossible solution'.

    Just stop working, look busy and focus on getting another job.

    Remember who gains/loses if someone somehow implements the 'impossible solution'.

    The sales maggot gains, his lies are now truth. His commission is now from a successful project. He will be telling new lies for the foreseeable future.

    The developer loses, he worked his ass off to implement an 'impossible solution' and now has to support the monstrosity for the foreseeable future.

    The client loses, sooner or later the impossible solution will fall over.

    The out-sourcer wins, their scumbag methods work again. The client will be back for a fix.

    When a sales maggot does this the project must be allowed to fail as quickly and publicly as possibly.

    --
    John McAfee 'It was like that time I hired that Bangkok prostitute; to do my taxes, while I fucked my accountant'
  21. Re:No comment... by stephanruby · · Score: 2, Insightful

    Let me guess, you're exempt and don't get over-time. And the sales people are mostly commissioned-based, and their commission is not based on the completion (nor the success) of the project (but just on having a signed contract with the client).

    If that's the case, and if you don't rise up, expect this kind of pattern of behavior to continue. I've seen sales people take down companies because they were chasing poorly structured commissions (instead of worrying about the viability and profitability of each deal they were making).

  22. Oh my God by TRRosen · · Score: 2, Funny

    Sales people lied...I'm Shocked.

  23. An insider perspective from a different case by Anonymous Coward · · Score: 2, Interesting

    I was called into the middle of a $110 million dollar contract between a very well known multibillion dollar company and HP. I was a subcontractor for HP that was assigned to make things work on the front lines. The vendor promised a migration of tens of thousands of computers without any need for desktop engineers other than simple boxing and unboxing. Over 800 packaged apps were on the line and over 50 desktop platforms had to be made to move to a single standard image.

    The client at the time had an almost exclusively 10Mb hubbed network. They also had a contract with AT&T that stipulated everytime a port on a hub, switch or router was touched AT&T made $400. Found out an entire 24 port switch was set to half duplex? That will be $9600 to switch the single switch to full duplex. We had dozens of such switches and over 200 sites. The contract with the client demanded that the network upgrade to a fully switched 100Mbps network would be completed before the migration of the tens of thousands of computers.

    Turned out the vendor promised the client their software would be so good that the client could reduce internal IT headcount by 25%. This was discovered by the clients IT department, and along with a contractual guarantee that no field engineer would be needed resulted in a perfect storm of non-cooperation with the clients IT department. It also turned out that the client postponed the network upgrade until after the migration to avoid those $400 a port switch costs as the contract with AT&T was due to expire in eight months.

    I got involved as I was one of only three people assigned to migrate tens of thousands of desktops with no client cooperation on a network that was primarily 10 Mbps hubs. The vendor promptly assigned package creation to India which resulted in fewer than 100 of 800 packages being available at migration start due to their incompetence.

    It was a perfect storm of incompetence and I was in the middle. I started keeping track of progress and wrote a daily report of what was successfully migrated, what wasn't and the reason for failure. For months the project dragged on, getting farther and farther behind as time went on. Unknown to me the client and the vendor started using my reports as a basis for daily fines that were in the six figures per day. Over the course of several months I unwittingly dictated how literally tens of millions of dollars were spent on fines between the two companies.

    At the end the client was suing the vendor for fraud (which was true) and the vendor was suing the client for contractual non-compliance (which was also true). I had two well known multibillion dollar companies getting ready to sue each other, with each having decided ahead of time that I was their preferred witness on why things went bad. I had law firms from both companies tell me to prepare for dispositions the following week as I was advised that I could be in court for several months while the court case progressed. In America when you are an witness you are not allowed to be paid for your time in court as that would be considered a bribe. (Expert witnesses can be paid as they are not material to the case and are outside it).

    I explained to both teams of lawyers that I of course cooperate with court and tell the truth. I also let them know that neither side would care for what I had to say. The case was settled the next day. I lost my job along with everyone else as part of the settlement. However I was able to get another job right away and was able to avoid personal financial disaster with being a witness in the middle of battling multibillion dollar behemoths.

  24. Re:Scope creep? by twiddlingbits · · Score: 2, Insightful

    The judgement couldn't happen to a nicer firm. HP screwed a lot of EDSers when they took over, and cut benefits and salaries to BELOW the level the "real" HP people were making. And they raided the pension fund for billions (HP has no pension plan)/ And they were going to keep the EDS brand...and they did for less than a year. Bad Karma comes back at you in many ways. That said there are a lot of good people at HP-EDS who may be hurt by all this crap even if they had nothing to do with it.

  25. Re:No comment... by micheas · · Score: 3, Informative

    I am not a lawyer. This is not legal advice. And even if I were a lawyer, I am not your lawyer. That said, the limits on verbal agreements are pretty narrow in the US. Basically:

    • Agreements to sell tangible property, such as a computer or car, worth more than $500
    • Agreements regarding the sale of real estate
    • Agreements that can’t realistically be completed in less than one year, such as a project with three six-month deliverables
    • Agreements that someone else will pay you, such as when someone who does not have authority to speak for the company promises that the company will pay you
    • Any transfer of copyright ownership

    Are not able to be made with a verbal contract. Everything else goes. For example, multi million dollar stock transactions are done verbally every work day. (yes end of day settlement does turn into a he said she said discussion with millions on the line during market downturns.)

    So, in the US a company sales team that promises that it can duplicate Google.com in six months for ten million dollars, could be screwed if the company cashes the check. Even if no executive officer signs off on it. (Then again a company that is depositing ten million dollar checks without oversight is screwed anyways.)

    --
    Work bio at MMWD
  26. It doesn't have to be this way by GordianusTheFinder · · Score: 2, Interesting
    Outsourcing companies and system integrators use a number of tricks to ensure the project is profitable whilst being the lowest bidder. These include:
    • Removing highly qualified engineers from the team early and replacing them with new graduates
    • Ensuring that changes to the specification are expensive
    • Over-promising during the sales process

    None of these is healthy and when it goes wrong, the only winners are the lawyers. I worked with a Major European Telco which outsourced the development of a large software system. It went wrong quite quickly and no useful code was delivered for two years while they sorted out the mess - expensive.

    It doesn't have to be this way. The construction industry has similar issues with large projects, due to the same root causes. The collaborative contract for the construction of Heathrow Terminal 5 was very successful and resulted in the project being delivered on time and on budget, with very few disputes:

    http://www.iaccm.com/contractingexcellence.php?storyid=368

    I wonder if the IT industry will attempt to learn from this ...

    Gord.