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Comptroller Accuses HP of Overcharging NYC $163m On 911 System
benfrog writes "New York City comptroller John Liu has accused HP of overcharging New York City $163 million on upgrades to its 911 system. According to a statement put out by Liu, an audit of the project revealed that HP did not perform up to spec on the contract between April 2005 and April 2008 and did not bill the city correctly for time and materials on its portion of the contract to upgrade the 911 system. According to Liu's reading, the contract was supposed to cost no more than $378 million over five years, but in January the city projected it would have already spent $307m by mid-April and had to award Northrop-Grumman an additional $286m to do a second part of the original contract, ballooning the cost to $632m, and Liu's office is now estimating that cost overruns beyond this could be as high as an additional $362m. NYC's deputy mayor for operations was quoted defending the contract."
This is a serious question to the technical community of /.; how does this happen? None of the projects I've been on have been this horrifically over budget.
When is the last government contract that DIDN'T go more than 50% over budget?
sudo make me a sandwich
Isn't that considered a huge success for a public project? Is someone going to get promoted?
Bloomberg was quoted as saying, "This is the second prong, after the CityTime project, in my attack on the city's financial obesity problem. Don't worry, you're going to elect me for a fourth term anyway."
How do I get in on the action? I do quite a bit of contract work these days, and it's almost impossible to pursuade any clients to accept any risk (i.e. by billing time, rather than a fixed cost) on R&D projects, even with a heavy element of R. How these large companies manage to pursuade others to write them a blank cheque is beyond me.
And before anyone mentions the government, Oracle seems to be very good at doing that with companies and other non-governmental organisations. I don't think I've heard of anyone who has done business with Oracle and not been fucked over by them.
I think it's just a reality distortion field which large companies have. Perhaps that's why they are large companies.
SJW n. One who posts facts.
The actual cost of any government project divided by its initial estimated cost closely approximates Pi.
You almost have to admire HP for fucking it up so badly that somebody voluntarily hired a defense contractor in the hope that they would be more competent and efficient...
This kind of dispute is fairly typical for a big IT project. The change requests from the customer roll in, some of customers' systems aren't what the vendor thought was agreed upon, some component prices go up, and their are additional execution problems on the vendors' side. So the result is delay and lots of overtime charges.
BTW this happened mostly on Mark Hurd's watch (although the contract was negotiated by his interim CEO predecessor), not Whitman or Fiorina.
I was reading yesterday that HP's person in charge of strategy was being promoted. I wondered at the idea that HP has a strategy in place. Now I know that strategy is fraud.
Just opened my bill and saw a $1 surcharge added for enhanced911. My state's trying to make-up losses. Now I know why.
My AC stalker: " I personally agree with your posts most of the time, but that won't keep me from modding you troll"
This is the second contract software project over $100 million that NYC has screwed up in just the past couple of years. (CityTime was the other.)
NYC is a big city which no doubt has lots of custom software projects it needs to do. Wouldn't it make more sense to hire employees to do this? It couldn't possibly cost more than the $600 million (!) of overbilling on CityTime plus the $160 million overbilling on this new white elephant. And they'd have actual control over the people they hire, and be able to hold them fully accountable if/when something went wrong.
The old jokes about $500 hammers notwithstanding, it's amusing to me how corporations are almost universally blamed when government contracts overrun. Nobody seems to notice that it's only government contracts that do this regularly -- normal companies that do this go out of business or into bankruptcy.
Back here in the real world, we call this piss-poor planning, usually traced back to marketing/sales causing constant feature creep or declaring ex post facto that a certain spec (that THEY WROTE!) doesn't meet customer/program demands.
I wonder, has anyone ever seen a post-mortem review of a government contract? Does government ever even attempt to figure out where the inefficiencies lie and correct them or at least plan for them next round?
Also, in before the NASA boogeyman shows up.
More than half a billion dollars for a project to take 911 calls? WTF? I mean even in my wildest dreams, with mapping and links to other systems and who knows what, how in the heck does it cost that much?
A government IT and infrastructure project went over budget? What a shock. This article would be post-worthy if it was a government contract coming in UNDER budget, this is the norm not the exception. The people in charge of arranging these projects: A) Do not understand the actual requirements. B) Often do not know what they already have. C) Drastically underestimate or do not factor in at all the maintenance costs. D) Don't know what they actually want or how to articulate what it is they think they want. As someone who has worked several 6 figure short term contracts for major airlines, you can hand over enterprise software to these people that they paid you hundreds of thousands of dollars to develop and then shove it on a VM with less power than you can purchase in a home PC with what they paid you per day to develop it. If its software they don't factor in hardware costs, if it's hardware they don't factor in installation and maintenance, if it's maintenance they don't factor in legacy costs, for all of the above they don't factor in training and changeover costs, or downtime. Now if you're willing to be a little bit underhanded, when you're bidding for this contract you smile and nod and accept it knowing that you will never be able to deliver on time. However if you know anything about project management and the likely wording of the contract, the things that will keep you from delivering on time are not outlined in the requirements and you will mark as PCR's(Product Change Requests) and not in scope for the original project and bill out the ass for them which a lot of companies do. The real issue, time and time again, is that the people hired to negotiate these contracts and the people who actually know what they need and what it'll take, never talk. As a result the requirements are always wrong, scope balloons, and so does the cost.
There is no memory shortage. yes I have heard of XFCE. Go away.
In a purely practical and objective standpoint, you are correct. It would make more sense to have employees of the city to do it.
But this is not a practical or objective world. There are politics to be played; Backs to be scratched and palms to be greased. For those in that sort of position of authority, there is a game to be played. Who can they trade this favor of a contract (with the possibility of over-payment) for some future consideration or contribution?
This is not the world of high-school civics that we were taught. These people are not there out of a sense of service to their fellow citizen or because they have good ideas that might make the world a better place.
This is the world where people have ambitions, who want to get ahead and further up the ladder of power. This is the world where people can and do get addicted to the feeling of power that their authority gives them and want only to increase it.
This is also the world where other people, further up the chain of authority tell the lower levels to who and how a contract should be presented. And because it is their boss or their boss's boss or their boss's boss's boss doing this, they fear for their jobs and livelihood and do what they're told instead of going out and shouting to the world of the corruption they've seen.
It was called ECTP, or the Emergency Communications Transformation Program. I worked in the PMO as one of many subs to HP. The fault for this, if indeed there was "overcharging", is with the City of New York. ECTP was run by the Mayor's Department of Information Technology and Telecommunications, or "DOITT", in conjunction with the NYPD and the FDNY. This project was plagued from the beginning with problems of the government's making.On a daily basis, the cops fought the firefighters , the firefighters fought the cops, and they both fought the mayor. No one from the mayor's office wielded the authority and political will to tell both FDNY and NYPD to shut up and get to work. They both fought the (necessary) transformation from beginning to end. Additionally, the program was staffed by the dregs of New York's civilian workforce. We literally had civilian employees who were mentally ill and completely unstable working on the project. You never knew from hour to hour if you were going to get the sweet and smiling personality, or the bipolar crazy screaming personality. They caused massive staff turnover, constantly changed requirements, played one contractor off against another, and generally made a mess of the entire program. It got so bad that at one point, the City borrowed an executive from a private sector firm to help run the project, because none of their own people could manage it. It's actually amazing that ECTP delivered anything of value, and it's hats off to HP, Winbourne and Costas, BearingPoint, and the other contractors involved that the transformation actually got delivered.
big projects get loaded with contractors and subs and that can add lot's of over head and lot's people sitting on there ass waiting for paper work or other stuff to get done.
Part of the problem with government contracts is that the project isn't just a business process with a uniform management struture. There's an operational hierachy that is trying to manage the actual project completion AND a political process capable, willing and actively engaged in influencing key elements of the project which effect it's effective completetion.
In some ways an in-house staff is worse than contrators. Contractors aren't really captured by the political process and once they are awarded a contract should be more willing to resist outside influence. Full-time employees are captured by the political process and more likely to engage in horse trading with the political leadership.
More governments need to nail those bastard that over charge and don't meet spec. Too many people are afraid they will look bad, so the force a bad system out and don't take recourse.
Portlands former Mayor Katz come screaming to mind.
The Kruger Dunning explains most post on
There is no God given right for America to have a job done without us fucking America up the ass so far that whoever pulls it out will be crowned the fucking King of England. .
Carly Fiorina HP CEO, June 14, 2010
There is no job we gave to Americans after we talked Congress into letting us re-patriate the taxes we dodged by relocating our jobs overseas, and with which we promptly paid ourselves huge bonuses and made a huge stock buy-back.
Carly Fiorina HP CEO, June 14, 2010
There is no job that is America's God-given right anymore, except mine.
Carly Fiorina HP CEO, June 14, 2010
There is no job for the 20,000 Americans we laid off so we could pay ourselves tens of millions in bonuses for that quarter...
Carly Fiorina HP CEO, June 14, 2010
There is no job for Americans at HP anymore because HP is going down like a crack whore in a housing project
Carly Fiorina HP CEO, June 14, 2010
There is no job that is America's God given right anymore.
Carly Fiorina HP CEO, June 14, 2010
http://videocafe.crooksandliars.com/heather/carly-fiorina-election-about-economy-and-d
(ducks)
I have worked on many projects like this, including many with NYC government. The spec is usually written by an outside contractor who has no clue about the real requirements. They just take a spec from another similar contract, and copy-paste it. It is usually so vague, you can deliver a box of bricks - or a launch system for the shuttle - and be either totally compliant, or totally non-compliant, depending on who you ask. The people working on the customer side are dumb and incompetent, and terrified of answering even a simple question, for their idiotic answers can be used against them when things head south. They are also mortified of upsetting their unions - and their unions use any such occasion to get upset, as their poor members' jobs get infinitely more challenging with any such system upgrade. They all need to learn which new button to press, and such. They need to attend many long hours of training. The list of grievances the unions submit for any such contract is a mile long.
All vendors, knowing all this, underbid the original contract knowing full well that there is plenty of money in change orders that are billed at T&M. The winning vendors then engage in a complex game of charades and chicken to find out the real requirements and get paid for them. My bet is that HP earned every penny of that T&M money, and Liu is blowing smoke.
... what software they're running for the 911 center.
Let me say that someone I know very well worked for the vendor who supplied the hardware and software for the City of Chicago 911 system in the late nineties. They heard that the vendor, PRC, which was first part of Litton, but sold around 2000 to Northrop-Grumman, had sold the system, Altaris, based on a prototype, *then* they had to make it actually work. By '97, they had, mostly, and it was to upgrades and enhancements. All of this ran on DEC Alpha failover clusters. By 2000, it ran really, really well.
IIRC, they said that NYC was looking at the software for their use.
Lessee, article says DEC, er, Compaq, um, HP for hardware, and Northop-Grumman for software..... Wonder what enhancements NYC wanted that were worth that much... oh, I know, they wanted it ported from C to Java-on-rails, or whatever.....
mark "deponent sayeth not"