Australian State Bans IBM From All Contracts After Payroll Bungle 212
renai42 writes "If you don't follow Australian technology news, you're probably not aware that over the past few years, the State of Queensland massively bungled a payroll systems upgrade in its Department of Health. The issues resulted in thousands of hospital staff being underpaid or not paid at all, and has ballooned in cost from under $10 million in budget to a projected total cost of $1.2 billion. Queensland has now banned the project's prime contractor, IBM, comprehensively from signing any new contracts with any government department, until it addresses what the state says are IBM's project governance issues."
Language Barrier (Score:5, Funny)
Obviously, you Aussie blokes need to learn Hindi if you want to partner effectively with IBM.
Re:Language Barrier (Score:4, Funny)
The Aussies would have learn English first.
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^ to
pot / kettle
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As an American, I find it easier to understand Australian English than many American-born English speakers.
Re:Language Barrier (Score:4, Insightful)
"Today Chinese build roads and buildings as the locals don't want to bake in the desert sun,..."
Perhaps one day they will even build a railway through America...
Re:Language Barrier (Score:5, Insightful)
Not likely given China's propensity towards spying on everyone.
Did you say that with a straight face?
Re:Language Barrier (Score:5)
Just because the Americans are spying on people doesn't mean the Chinese aren't doing it too.
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Damnit, Entropius, now I have coffee all over my display.
Re:Language Barrier (Score:5, Funny)
:P
I don't see why we don't just outsource all our snooping to the Chinese. The outcome will be the same but it'll be cheaper for the American taxpayer, and the Chinglish translations will be hilarious.
Lol (Score:5, Informative)
Deflection, Qld health are the worst run bureaucracy in country. I've heard first hand they put non IT on the project and were forever changing scope then pushing forward with little or no testing.
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That came up in the various stories I read yesterday about this issue - and I'm more inclined to believe IBM's side of the story.
Re:Lol (Score:5, Interesting)
Indeed. IBM's reputation is pretty well established. They are slow, tedious and yet effective. They are a glacier in IT. But I see it everywhere -- people making decisions in an IT project that have know knowledge of what it takes to make things happen. The illusion that "it's all so easy" has really gotten buried too deep in someone's head somewhere.
Re:Lol (Score:5, Informative)
Indeed. IBM's reputation is pretty well established. They are slow, tedious and yet effective. They are a glacier in IT. But I see it everywhere -- people making decisions in an IT project that have know knowledge of what it takes to make things happen. The illusion that "it's all so easy" has really gotten buried too deep in someone's head somewhere.
The magic phrase is "All You Have To Do Is..."
Those six words have destroyed more IT projects than anyone can count.
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And the man-month. The mythical man-month. Let's not forget the man-month. Have I mentioned the man-month yet? :)
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And the man-month. The mythical man-month. Let's not forget the man-month. Have I mentioned the man-month yet? :)
Ahem. PERSON-month. Can't offend the PC crowd, now.
"person" months are computed in units of AYHTDI. So the two are related.
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Ahem. PERSON-month. Can't offend the PC crowd, now.
Particularly when everyone is moving to tablets.
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RabidReindeer and nwf, thank you. No fizzy drinks nor keyboards were harmed while reading those posts. Only barely so.
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Indeed. IBM's reputation is pretty well established. They are slow, tedious and yet effective. They are a glacier in IT. But I see it everywhere -- people making decisions in an IT project that have know knowledge of what it takes to make things happen. The illusion that "it's all so easy" has really gotten buried too deep in someone's head somewhere.
The magic phrase is "All You Have To Do Is..."
Those six words have destroyed more IT projects than anyone can count.
My favorite requirement is: "Works as designed"
Re:Lol (Score:4, Insightful)
The illusion that "it's all so easy" has really gotten buried too deep in someone's head somewhere.
I think it's because PC's are the new 'old car'. In my youth, when men were bored, they would go tinker around with their cars. This tinkering began and ended at home, simply because there was no translation to the workplace. Today, though, with all the gee-gaws and doohickeys that are on modern cars, men have less to tinker with. What we do have, though, is a home PC. We can tinker, we can figure, we can play with the home PC and not really screw stuff up. SO, to people like that, it really is a simple transition between home PC tinkering, and systems design.
Or, it could be because most people HAVE to have say in what goes on around them, regardless of skills or knowledge.
One of those two things.
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That's half the problem. The other half is the 'business logic' that never made any sense in the first place. What is actually being done is multiple individuals' interpretation of a tremendous mass of confusing and conflicting rules combined with unwritten assumptions and word of mouth 'folk wisdom' that may or may not bear any relation to what is documented. Further, there is a good chance that nobody actually knows where all of the documentation is or how inclomlete what they have may be. Implicit in tha
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The illusion that "it's all so easy" has really gotten buried too deep in someone's head somewhere.
Sure, but payrolls are easy. They were easy when I was doing it for local and national governments in Europe 30 years ago, and I don't see that they could possibly have got much harder since then, even if staff do get demoted/promoted five times a day.
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India Business Machines is among the worst information technology outsourcing and consulting services in the world.
You're talking about a completely different company. "IBM" in this context refers to "Itty Bitty Machines". Or the opposite, as in "an elephant is a mouse with an IBM operating system". Take your pick...
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It does seem unbelievable that IBM and IBM alone is responsible for the project's failure given the fairly small piece of the pie they had.
Re: Lol (Score:4, Informative)
Ditto. I know one of the IBM Admins for this job, she said Qld health signed off at every stage before going live. I'd like to see who has the greater budget for a court battle - the qld govt is broke.
Re: Lol (Score:5, Interesting)
The telling part is that IBM only got $25M for their efforts. I say this as a government PM. We are absolute, miserable failures at buying software. We don't know what we want, which begs IBM, SAIC, SAP, et al, to bid low and then increase the price every time we go "shit, we didn't really mean that."
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That Dilbert cartoon was based on a reality I think we all share. The business comes in and says "we want the WhizBang package." The giant IT wheels kick in and someone says "you must follow procurement procedures, specify requirements, find vendors, get bids, select vendor, etc." So IT asks "what are your requirements", and the business says "we want what WhizBang does."
From then on facts no longer seem to matter. Some analyst copies WhizBang's brochure into a spreadsheet and labels it Requirements.xls
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I know one of the IBM Admins for this job, she said Qld health signed off at every stage before going live.
By itself, sign-off is a red herring in these issues. The contractor is supposed to have the expertise to propose viable solutions before the sign-off, and then to implement them effectively. If the client went against good advice or repeatedly changed its mind, then it carries a share of the blame that can reach 100%, but you cannot establish that from the sign-offs alone (after all, the contractor also signed off on the same things at the same time.) The sign-offs are useful only as corroborating evidence
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No amount of expertise will tell you that while the client insists they want X, they really want Y. And even if it does, you will never get them to sign off on solution B that provides Y, they will only ever sign off on solution A that offers X.
It will not be until the project is nearly done that they will suddenly claim they wanted Y all along even if you did everything but cram Y down their throats on day 1.
Re: Lol (Score:2)
My take is that its a lot like paying somebody to build a house. There are expectations of meeting building codes and energy efficiencies you would "just expect" a builder to follow. The model house had all those things... So a middle manager signs to start building the house... And gets a structure with no plumbing and no windows... The bathroom is in the glossy picture, but the document didn't say "plumbing to utilities" so they come back and ave to chop up your basement with a NEW QUOTE to put the plum
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Ok then what's the purpose of HAVING a sign-off if not to say "I understand this, think it's a good idea, approve of it, and am willing to put my name to it?" QED.
Exactly. The productive work, in contrast, consists of figuring out what is to be done and how it is to be done, and doing it. If things work out well, the sign-off itself is moot.
Re:Lol (Score:5, Informative)
I worked on a large project for a quasi-government body building software for Queensland Health as a customer.
They had reservations about us being able to deliver. We delivered a rock-solid piece of software on time and budget. They, however, took 8 _years_ to take that piece of software and put it into production.
Yes, they are that bad.
They were a basketcase _at least_ a decade before the payroll bungle.
Re: Lol (Score:2, Insightful)
âThe job of an IT department is to block or delay any solution implementation"
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I am Mordac, Preventer of Information Services.
Re:Lol (Score:5, Insightful)
Requirements:
Make it better than the old system.
Make it work the same way as the old system.
Make it compatible with every else's system.
The only trade-off allowed is cost, since it's just tax dollars.
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IBM Pulled out after the costs really started to balloon.. as in the 10's of Millions... And then it really went down hill.
Re: Lol (Score:2)
90% of the blame goes to the ones making the request.
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Wrong! (Score:5, Insightful)
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That's how software procurement works in the private sector too.
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"Well, we have a lot of experience working closely with them"
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I tend to find "Working closely" = "We have given them a quote 6 months ago"
Jason
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A company that has failed to deliver on multiple contracts in the past should be given priority, because it has significant experience in government contracting work!
And a company that was ready to sell a $1.2 billion product for only $10 million should be praised as benefactors of Australia!
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You could have said : "oh you're from that world too?".
Everywhere in the world where I lived and worked, it was more of the same.
$1.2 billion payroll system (Score:5, Insightful)
If I were paying $1.2 billion for something as rote as a payroll system, it better be fucking amazing. It's estimated that the entirety of Linux could be recreated from scratch for $600 million. A payroll system twice as complex as the entire Linux operating system! Think of the possibilities! I have no idea what the possibilities are, but they must be amazing to justify that cost!
Re:$1.2 billion payroll system (Score:5, Insightful)
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Are you implying a manager only works for 5 hours and 20 minutes a day?
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Re:$1.2 billion payroll system (Score:4)
If I were paying $1.2 billion for something as rote as a payroll system, it better be fucking amazing.
The real WTF is that IBM still don't have an off-the-shelf payroll system.
Paying people's wages is almost the original computer application.
Re:$1.2 billion payroll system (Score:5, Insightful)
Every consulting company out there has multiple off the shelf, turnkey payroll options. Just that no one wants them. Most of the time, the "consultants" just customize one of the options as per the customer's unique needs. Then the customer has even more extremely special and unique needs. Some clearly poor practices and some just not feasible. About 1/2 way through the project people realize that the customer never wanted an off the shelf, turnkey solution. They want a custom built solution. But they just keep going cause its hard to stop a train; even thou they all know the wreck that is coming.
Funny thing is that if people just bit the bullet and understood the limits of a turnkey or that they wanted a custom solution, they would certainly save a lot of money. It would cost more than the original budget but it would cost a LOT less than the end result. This is why people just don't be honest up front. No one likes approving a $100k project while there is a $90k option. No matter how wrong the second is, they just spend $9.9k figuring out how make the later look good in the summary reports.
I have spent an unfortunately amount of time & cost convincing and proving to the decision makers what basically to me was 2+2 can not equal 5. It feels insulting most of the time cause they bring us in for our "expert" opinions, but don't trust said opinions. Until there is a cost that is big enough to show up as a line item in a report or some high up gets red in the face. Its sad, but just the way of the world.
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I've seen and played with a swedish accounting/payroll package that ran on Luxor's ABC 802 computers, with data stored in an ISAM database on a CatNet server (a niche swedish networking system). The entire package was written in BASIC and was reasonably nice in use, IIRC. Now this wasn't a port of the relatively poorly performing Microsoft BASIC. ABC 800 BASIC was an original design and performed well enough to implement such a system. I've seen it run in a small business with dozens of employees and millio
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I'm afraid that calling this a solved problem is like saying that because we've successfully created nanofibers, we should already have a space elevator. There's an enormous gap between a mere accounting system to help balance a single checkbook, and the tracking and integration necessary to actually handle paychecks. And in a large government bureaucracy, the number of distinct systems and workflows that have to be replaced or integrated to will be enormous, and fought tooth and nail by people who perceive
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$25 million has gone to IBM. This means the Qld government has wasted the other $1.175 billion on 'consulting', 'implementation' and 'training'. IBM is just a scapegoat here for the state government's incredible incompetence in, really, everything they touch.
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It wouldn't be Slashdot without someone finding a way to mention Linux in an article that isn't even relevant to it. :)
Re:$1.2 billion payroll system (Score:5, Interesting)
In fact IBM did comment on this:
As the prime contractor on a complex project, IBM must accept some responsibility for the issues experienced when the system went live in 2010, however, as acknowledged by the commission’s report, the successful delivery of the project was rendered near-impossible by the state failing to properly articulate its requirements or commit to a fixed scope.
IBM’s fees of $25.7 million accounted for less than 2 per cent of the total amount. The balance of the costs is made up of work streams which were never part of IBM’s scope.
Re:$1.2 billion payroll system (Score:5, Insightful)
In fact IBM did comment on this:
As the prime contractor on a complex project, IBM must accept some responsibility for the issues experienced when the system went live in 2010, however, as acknowledged by the commission’s report, the successful delivery of the project was rendered near-impossible by the state failing to properly articulate its requirements or commit to a fixed scope.
IBM’s fees of $25.7 million accounted for less than 2 per cent of the total amount. The balance of the costs is made up of work streams which were never part of IBM’s scope.
There is an expectation that engaging a large professional specialist contractor would avoid the problems of using a smaller outfit or running the project in-house. You'd expect a specialist mega-corp would be able to help you define the scope and requirements of the project, as it's something of which they supposedly have prior experience.
IBM should have been the one asking the right questions at the start, and requesting access and authority to do their job. It's not like a health care payroll system is something new that no one's ever seen before. The QLD government is essentially employing IBM to be the experts in this area to deliver a suitable system.
I see this crap from these big end of town software outfits all the time. They sell products and customisations that the client doesn't need, features that in most cases just get in the way and make the systems unusable. They charge 10s to 100s of millions to build websites that are unstable and too cumbersome to maintain and use. And generally overcharge for a final product that they shoehorn to fit the actual requirements of the customer (and by extension, the customer's customers).
I don't think the general tendering/bidding process helps much either, as it doesn't always give enough access to scoping and requirements gathering to be able to generate a valid cost estimate. In many cases it comes down to the sales team getting a huge bonus contingent to signing off on the sale. And they'll say and promise anything upfront, and let the weasel^wlegal team rewrite the contracts to make every request for something that should have been included seem like an out-of-scope up-charge.
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He wasn't saying that it should be called GNU/Linux; he was saying that the cost of creating the Linux kernel, vs. the cost of creating the Linux kernel + gcc + everything else, might be very different.
Perspective (Score:2)
"Hey honey, I'm going to McDonald's to grab a bite to eat, be back in 10!"
(A few hours later)
"... Umm, honey, how did you manage to spend $710 dollars at McDonalds?"
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* Footnote: The average meal at mcdonald's costs around $6. The ratio is accurate: This is like going to McDonald's to order a happy meal and winding up spending more than you do on rent for it. Whups.
Re:Perspective (Score:4, Insightful)
"Hey honey, I'm going to McDonald's to grab a bite to eat, be back in 10!"
(A few hours later)
"... Umm, honey, how did you manage to spend $710 dollars at McDonalds?"
But let's be fair, the actual breakdown is probably more along these lines:
$6 Happy meal (expected budget)
$250 consultants and managers haranguing you about how you are hungrier than expected
$200 to replace provided hamburger with a specialty burger
$250 "expert eating" trainers who advise you on the how to insert hamburger into mouth
$4 extra hamburger you ate because the above three took so much time lecturing you that you got hungry again
IBM only got $25 million of that $1.2 billion. The rest was a result of "the state failing to properly articulate its requirements or commit to a fixed scope." [delimiter.com.au]
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Such a cost increase would probably be due to similar bungling on the part of the seller, I imagine, who is not able to articulate clearly what, exactly, he wants. It's not like QLD was buying off-the-shelf software that required no customisation.
"A burger, please!"
"Wait, no, I'm allergic to peanuts. Did the packaging of any of the food you sell say it may contain traces of nuts? Please throw away all of the stuff you have cooking, sterilise the food preparation area, and re-make my burger."
"That's a meat b
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The answer to that is very obvious.
The person helping him at McDonald's was a student that moonlighted as a McDonald's server, but secretly made money on the side as a stripper.
There. Simple explanations are lovely.
Australia could have learned from New Zealand (Score:5, Insightful)
IBM were the contractor for New Zealand's largest IT cock up INSIS (Integrated National Crime Information System, http://en.wikipedia.org/wiki/INCIS [wikipedia.org]) which was a total flop and cost $110,000,000.
Funny thing is though, we didn't learn from our own mistakes and hired an Australian company called Talent2 for our Education Payroll. It has been a runaway failure (with more new bugs being found than being fixed over any given time period).
Re:Australia could have learned from New Zealand (Score:5, Informative)
Geography lesson: New Zealand is NOT a state of Australia.
However, we've got provision for you in our constitution, just waiting :P
6..."The States" shall mean such of the colonies of New South Wales, New Zealand, Queensland, Tasmania, Victoria, Western Australia, and South Australi
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It's New Zealand's choice as to whether they become a part of Australia or not though, iirc? Although if they do I don't think Australia then gets a choice in the matter, it just happens. I can't see NZ wanting to do anytime soon though...
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In the US, there was a "three-fifths compromise" in the drafting of the Constitution, where the South got to count 3/5 of the slave population in determining representation in Congress. Could NZ do something similar with sheep?
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And they call American imperialism bad. At least we just overthrow democratly elected governments we don't like. You Aussies are laying claim to a sovereign state.
Queensland Health Payroll were a joke already (Score:5, Informative)
My wife is a doctor who works for Queensland health. To be honest, they had comprehensively mucked up her payroll numerous times prior to the IBM System. Unfortunately, they now feel the need to deduct her pay based on shifts she did 4 years ago (as the new system has slightly different data than the old one). The staff of QH are basically comprehensively useless, and even prior to the new system they would do things like email her other people's personal details and salary information. The staff always have been lazy and careless, and the new system couldn't handle users that didn't give a shit about doing a good job. IBM has undoubtedly ballsed things up, but QH Payroll are genuinely amongst the least competent people in the world. In fact, pretty much anyone in a government position in Queensland is useless, which is why they are in the process of firing 16,000 of them...
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I've known Managers in the QLD government system who would move office equipment around the building so that it slowed down workflows and many more staff where needed to do the same job.. Why? Because they got pay rises when they went over certain staff numbers.
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That sounds like a systemic management problem rather than "staff are lazy".
Every time I've heard of issues like that it's because some bright spark has - quite by accident - directly related people's annual review to how imaginatively they can screw colleagues over.
Same thing here (Score:3)
Project governance issues (Score:5, Interesting)
I thought these contracts were just an excuse by suppliers to wildly overcharge governments on the daily rates, software licences and support fees knowing that once the ink has dried on the contract they basically have them by the balls.
I wonder given the expense of these systems if governments wouldn't be better off to hire teams in-house to write this stuff.
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The London Congestion Charging System was delivered on time, within budget and with no major flaws.
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Hmm, about that successful Docklands Light Railway
i.e. it took five years to fix the issues with it.
It's also overcrowded and the level of demand was grossly underestimated.
Capitalism is a sponge (Score:2)
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That may be true in this case, but Australians get a whole lot more value for money than Americans do when it comes to healthcare. Just look at the numbers:
http://en.wikipedia.org/wiki/List_of_countries_by_total_health_expenditure_(PPP)_per_capita [wikipedia.org]
Healthcare costs are about 50% cheaper per capita than in the US, and Australias get far, far better services.
Airports always give me a chuckle (Score:2)
Every time I'm at an airport, and see the backlit billboards pandering various IT and organizational consulting services, I think of the endless stream of waste of our, the taxpayer's, money those companies have caused, are causing, and will, very likely, continue to cause. Every time some smug suit talks about how great outsourcing is, and how their consultants are going to fix everything for everyone, I just chuckle. It's the stories like this that keep my chuckle going. IBM Australia, thank you very much
$10 million to $1.2 billion (Score:3)
Re:$10 million to $1.2 billion (Score:4, Interesting)
But you'll note only 2% of that money went to IBM. A 25 million final cost on a 10 million dollar project is only a 150% overrun, and quite reasonable given the spec churn that occurs in government. The specs are never final at the time of bidding, and everyone knows that.
It would seem the bigger consumer of resources was by far the "out of scope" costs that the goobermint conveniently ignored while setting the initial budget. There are always costs involved with large deployments, and they usually dwarf the cost of development, especially if hardware and infrastructure costs get rolled into it, such as upgrading everyone's PCs from XP at the same time, but "sneaking" that expense into the budget of the large project. And that happens All The Time.
The common thread is government business (Score:2)
IBM has had some newsworthy problems with big contracts of late and ALL of them are government deals. And at that all of them are at the sub-national level; states, provinces and such. Whatever is going badly wrong has to do with the horrendous problems of trying to do business with 'state' governments be it Texas or Indiana or Queensland. For every anecdotal story about the absurd demands placed on contractors by Federal or National governments - states are that and more. The states seem to think they can
Sounds like what IBM did in PA (Score:2)
The Department of Labor and Industry wanted to upgrade its unemployment compensation system from its mainframe system. IBM initially said it would take 3 years and cost $15 million.
The state finally pulled the plug after the project was 42 months behind schedule and $60 million over budget.
So much for those vaunted project managers and the PMI certs they have. These two projects fall under the 70% of IT projects that fail, a statistic that hasn't changed in 2 decades.
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I think that those big failures indicate something about human nature at a much lower level. The green screen (CICS and such) was something that every developer could reasonably comprehend in its entirety, and there weren't really a 100 ways to do anything and everything (AFAIK based on 2nd hand lore). It was "limited", but those limitations made it mesh with human limitations. Bazillions of CICS and architectural lookalike systems were successfully deployed, and are still in use and under maintenance.
Then
IBM (Score:2)
I remember an IBM project at my old day job where the firm, fixed-price bid was $5 million with delivery in 3 months.
5 years and $27 million dollars later the project was abandoned, no product was ever delivered.
The government project manager was given an award and promoted.
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If you can't get the promotion, leave the company early in the project. I've seen it happen a number of times, in both the public and private sector. Start a new project, often involving a famous ERP product, with much fanfare. Get it running, spruce up the resume, then leave after 6 months for a higher paying job. The poor schmucks who they left behind got the blame for the project failure.
Project governance issues? (Score:2)
I think not. IBM maximized profits, didn't they? Isn't that what a well run project should do? Nothing is as efficient as a private sector corporation in maximizing profits. They should get some sort of award for this, increasing revenue by 12,000 percent. Just think of the taxes they paid!
Right. IBM Needs More Process. (Score:4, Interesting)
WTF? (Score:2)
I understand cost over-runs, but this is a full two orders of magnitude bigger. That's ridiculous.
This sounds like someone went into this with no friggin' idea of what the scope was, or knew damned well it was much larger than the client would go for, and knew they'd make it up on the "time and materials" aspects of it.
C
Are they still using SmallTalk? (Score:2)
I remember back in the day IBM had a few major project failures around SmallTalk.
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What did Smalltalk have to do with those problems? Whatever one thinks of Smalltalk, it does work. Maybe it's a little slow (I'm not even sure), but these don't seem like speed critical applications.
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This was back in the 90's. SmallTalk was IBM's enterprise language which they dropped mid 90's in favor of Java. Specifically the problems centered around the over-use of unary methods and operator overloading. In large applications it would become harder to understand and maintain the whole system.
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ebno's 2nd law: you can write bad code in any language.
It may be a poor choice (I can't really say because I don't know it), but I'm skeptical of blaming major project failures on the choice of language. A good language helps (and reduces the amount of profanity heard from programmers), but successful projects have been built using some pretty awful languages.
This calls for a Professional Superhero! (Score:2)
We need ACTION ITEM MAN! Professional Superhero.
http://professionalsuperhero.com/ [profession...erhero.com]
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They should have gone with Pronto [pronto.net]. An Australian ERP company that is quickly responsive to changes in legislation (for Australian and overseas customers) and very flexible during implementation.
I've recently finished a two year planning and implementation of Pronto for my employer, and we are impressed with the outcome. We were on budget, accomplished within a reasonable timeframe (given some feature creep) and the post implementation support is great.
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don't you need to learn German to work for IBM?
You think IBM likes assisting in genocide? Don't be ridiculous - they just don't care.