6 ms·

HP-EDS: the failed CRM project that cost it £200m ...and counting

23 points by monkeygrinder 17y ago

ordinaryman 17y ago
Reminds me of the recent news on http://bit.ly/Sydney-Water-CRM http://bit.ly/Sydney-Water-CRM "expected to cost $55 million, more than double original budget of $21 million and one-and-a-half years behind schedule"
- mseebach 17y ago
  It absolutely blows my mind how these things can be so complicated. There's a pipe and a meter. The meter is read n times a year. Invoice. Done. I can see how asset management can be complicated for a utility, but what exactly is keeping Sidney Water from using an off-the-shelf product for friggin' CRM?
  - weego 17y ago
    If you can sign off $55 million you must be a very powerful person. Anyone can sign off buying a software box. Same reason why in Japan there are bridges that link 2 places no one needs to go to.
    - dreemteem 17y ago
      Same thing in Scotland, with the Edinburgh Parliament building. Started out as costing £40m, ended up costing more than £400m. In this case, the architect died before it was finished. Noone to sue.
- megamark16 17y ago
  I love this part (from your Sidney/Water CRM link): "Once implemented, the project, which also has a second phase, bringing expenditure up to $68.9 million, is expected to reduce operating costs by $1.9 million a year." So they should recoup their costs in about 35 years. Priceless (well, not really).
monkeygrinder 17y ago
The case is unique because Sky claimed EDS was fraudulent, and had dishonestly exaggerated its abilities and resources when bidding for the contract. This case result shows two things: IT suppliers’ sales teams must be more careful about their claims when they are trying to sell a system. Gone are the days when there was a disparity between what is sold and what is delivered. Second, the liability cap is immaterial in fraud cases. EDS had a cap that it would not be liable for more than £30m worth of damages. But because Sky sued for fraud, the liability cap was rendered irrelevant. What do you think?
- va_coder 17y ago
  "Gone are the days when there was a disparity between what is sold and what is delivered." lol
- rogersm 17y ago
  It's a clever way of suing your provider. Accenture was sued using the same strategy: http://blog.obiefernandez.com/content/2008/03/sap-sued-for-ty.html http://blog.obiefernandez.com/content/2008/03/sap-sued-for-t... But Does Sky need to demonstrate EDS sales team was acting in bad faith? These kind of sales processes are so long and complex that badly selling the solution does not imply bad faith. I'm completely sure that the sales team had not all the information of how things were going to be delivered and for sure they took some optimistic assumptions, but I'm sure they're not trying to swindle sky. Just for laughs, I recommend this scribd presentation: http://www.scribd.com/doc/2304178/Confessions-of-an-Ex-Enterprise-Salesperson-by-Doug-Mitchell http://www.scribd.com/doc/2304178/Confessions-of-an-Ex-Enter...
- francoisdevlin 17y ago
  caveat emptor
sailormoon 17y ago
The judge noted in his judgment of the case that the Entire Agreement Clause failed to explicitly cover EDS from claims of negligent misrepresentation. I guess I'm not really cut out to be a lawyer; I can't really imagine having the gall necessary to demand a clause in a contract protecting me from "negligent misrepresentation" ...
- conover 17y ago
  That's what I thought as well. Putting a clause like that in contract says to me, "It's possible we'll do this so badly you will sue us." I'm not sure I'd want to do business with a company like that.
  - sailormoon 17y ago
    It's like those Halliburton contracts which apparently force you to give up your rights to complain if you're raped. It's like .. right, does this happen often? What exactly inspired this clause's inclusion?
artlogic 17y ago
I worked for EDS for 9 years... they were barely able to keep their own internal CRM running. It was a nightmare. I sometimes wondered how the sales staff were able to hide the internal dysfunction so well. Practice I guess.

23 points by monkeygrinder 17y ago

Reminds me of the recent news on http://bit.ly/Sydney-Water-CRM http://bit.ly/Sydney-Water-CRM "expected to cost $55 million, more than double original budget of $21 million and one-and-a-half years behind schedule"

mseebach 17y ago
It absolutely blows my mind how these things can be so complicated. There's a pipe and a meter. The meter is read n times a year. Invoice. Done. I can see how asset management can be complicated for a utility, but what exactly is keeping Sidney Water from using an off-the-shelf product for friggin' CRM?
- weego 17y ago
  If you can sign off $55 million you must be a very powerful person. Anyone can sign off buying a software box. Same reason why in Japan there are bridges that link 2 places no one needs to go to.
  - dreemteem 17y ago
    Same thing in Scotland, with the Edinburgh Parliament building. Started out as costing £40m, ended up costing more than £400m. In this case, the architect died before it was finished. Noone to sue.
megamark16 17y ago
I love this part (from your Sidney/Water CRM link): "Once implemented, the project, which also has a second phase, bringing expenditure up to $68.9 million, is expected to reduce operating costs by $1.9 million a year." So they should recoup their costs in about 35 years. Priceless (well, not really).

monkeygrinder 17y ago

The case is unique because Sky claimed EDS was fraudulent, and had dishonestly exaggerated its abilities and resources when bidding for the contract. This case result shows two things: IT suppliers’ sales teams must be more careful about their claims when they are trying to sell a system. Gone are the days when there was a disparity between what is sold and what is delivered. Second, the liability cap is immaterial in fraud cases. EDS had a cap that it would not be liable for more than £30m worth of damages. But because Sky sued for fraud, the liability cap was rendered irrelevant. What do you think?

va_coder 17y ago
"Gone are the days when there was a disparity between what is sold and what is delivered." lol
rogersm 17y ago
It's a clever way of suing your provider. Accenture was sued using the same strategy: http://blog.obiefernandez.com/content/2008/03/sap-sued-for-ty.html http://blog.obiefernandez.com/content/2008/03/sap-sued-for-t... But Does Sky need to demonstrate EDS sales team was acting in bad faith? These kind of sales processes are so long and complex that badly selling the solution does not imply bad faith. I'm completely sure that the sales team had not all the information of how things were going to be delivered and for sure they took some optimistic assumptions, but I'm sure they're not trying to swindle sky. Just for laughs, I recommend this scribd presentation: http://www.scribd.com/doc/2304178/Confessions-of-an-Ex-Enterprise-Salesperson-by-Doug-Mitchell http://www.scribd.com/doc/2304178/Confessions-of-an-Ex-Enter...
francoisdevlin 17y ago
caveat emptor

sailormoon 17y ago

The judge noted in his judgment of the case that the Entire Agreement Clause failed to explicitly cover EDS from claims of negligent misrepresentation. I guess I'm not really cut out to be a lawyer; I can't really imagine having the gall necessary to demand a clause in a contract protecting me from "negligent misrepresentation" ...

conover 17y ago
That's what I thought as well. Putting a clause like that in contract says to me, "It's possible we'll do this so badly you will sue us." I'm not sure I'd want to do business with a company like that.
- sailormoon 17y ago
  It's like those Halliburton contracts which apparently force you to give up your rights to complain if you're raped. It's like .. right, does this happen often? What exactly inspired this clause's inclusion?

artlogic 17y ago

I worked for EDS for 9 years... they were barely able to keep their own internal CRM running. It was a nightmare. I sometimes wondered how the sales staff were able to hide the internal dysfunction so well. Practice I guess.