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Everyone assumes its about connections and kickbacks, but its actually more to do with procurement policies. The people who sign off on large contracts need to

by PaulAJ 6y ago

Everyone assumes its about connections and kickbacks, but its actually more to do with procurement policies. The people who sign off on large contracts need to be able to demonstrate due dilligence, because if they don't then when something goes wrong they will be blamed for hiring cowboys instead of professionals. But this merely creates a series of hoops through which the candidate contractors must jump. Ultimately the process of getting these contracts becomes so cumbersome, expensive and risky that only a few large companies do it. They naturally become experts at hoop-jumping, often to the detriment of actually doing the work. I once saw the bid evaluation criteria for a large company I worked at. Over half the scoring points could be summed up as "one of the usual suspects" (e.g. big company, has track record in industry, has staff with industry experience, has done similar work in the past). If you weren't one of the usual suspects you had no chance of getting the job.

buran77 6y ago
> (e.g. big company, has track record in industry, has staff with industry experience, has done similar work in the past) That's the classic CYA, or the "nobody gets fired for buying IBM" adage. I've dealt with procurements for eye watering amounts both in the private and public sector. But no matter how much you struggle to get the good product eventually some hard requirements (either legal or institutional) will be shoved down your throat and you end up with the Accentures of the world. They must have comparable revenue to the customer. They must have had similar projects going at least 10 years back. They must be able to deliver the service 24/7 in any corner of the world even if we only have one office. You can't say anything about past performance in projects even if it's objectively measurable because it would put one competitor at a disadvantage. So what if Accenture blew the budget by an order of magnitude and delivered a year+ late on every single project they had with you, that's the past, we're starting with a clean slate every time. Then the contractual conditions can't be harsh enough that even Accenture says "not for us" because that all but guarantees that you have no bidders. So now every startup is out the window and all you're left are the big ones. And when the project bombs - and bomb it will one way or another, Accenture will guarantee that because they make money by underbidding and then overcharging you through your nose for CRs and fixing what they failed to deliver under one contractual loophole or another - the people in charge from the customer side always have good cover. They picked the best offer. Nobody could have done it better. This goes hand in hand with Gartner recommendations, the company that came to me with 2 conflicting reports and let me choose which one I want to present to management depending on what version I wanted to push. I laughed them out the door and when going face to face with the higher ups the first thing that came up was "what does Gartner say?". Try answering "anything I want"... They need plausible deniability so you're there to plausibly shield them from the reality of this farce. So you call Gartner back and ask for that report "we first talked about". Nobody gets fired for buying Accenture (or the likes). They'll just leave in disgust.
- heavenlyblue 6y ago
  In other words, you could hire Accenture and pay some big cat a lot of money, or you could pay 10 startups that money and let 90% of them fail and let someone to become big again.
  - buran77 6y ago
    Mathematically yes (a la "9 women can deliver a baby in 1 month"). But in practice no because there's almost no way you can write fair requirements in a procurement that will apply to all and somehow exclude only Accenture (&co.). This is their actual power, officially they tick all the boxes and look as qualified as one can be, and they can also underbid almost any startup. Because they have far more qualified lawyers than engineers to help the make up for it later. It's only when they start work do you get the real Accenture experience: hundreds of inexperienced, unqualified, overworked, or underpaid people under the careful eye of someone who's paid to delay and overcharge under any possible interpretation of the contract. They are better at this game than almost any startup because their game is "winning bids". They are ridiculously connected and able to operate almost exclusively in the grey area, with a lot of detours in dark as hell area. And they are always seen as the "safe choice". If Accenture fails a CEO can say "we did our best, picked the experts". When a startup fails the CEO has no plausible deniability. They went with the risky, unproven option and have to pay the price. You can either go the fair competition route and Accenture can easily tick the boxes on paper and then win on price, or you can go for direct award (in a private company) but you'll be living at the gates of hell until the project is successfully completed.
blaser-waffle 6y ago
Absolutely correct. Saw it on the Gov't/Defense side of the house and in the civilian Enterprise sector. To be blunt, the reason big firms get the contract is because we know where they live, we know they'll deliver something, even if it's utter dogshit, and we know they won't go out of business in 3 years, so if we need to support the build -- or just sue them -- then we know where to find them 36 months from now. The Big 4 may only bat .500 but I can bet against ~50%. There is also a selection bias: no one has heard of the small-fry shops that fuck up, and when they do they can quietly re-brand, disappear, or dissolve. Anyone here ever get burned by YellowOps? Probably not. But everyone here has heard of KPMG...

by PaulAJ 6y ago

buran77 6y ago

> (e.g. big company, has track record in industry, has staff with industry experience, has done similar work in the past) That's the classic CYA, or the "nobody gets fired for buying IBM" adage. I've dealt with procurements for eye watering amounts both in the private and public sector. But no matter how much you struggle to get the good product eventually some hard requirements (either legal or institutional) will be shoved down your throat and you end up with the Accentures of the world. They must have comparable revenue to the customer. They must have had similar projects going at least 10 years back. They must be able to deliver the service 24/7 in any corner of the world even if we only have one office. You can't say anything about past performance in projects even if it's objectively measurable because it would put one competitor at a disadvantage. So what if Accenture blew the budget by an order of magnitude and delivered a year+ late on every single project they had with you, that's the past, we're starting with a clean slate every time. Then the contractual conditions can't be harsh enough that even Accenture says "not for us" because that all but guarantees that you have no bidders. So now every startup is out the window and all you're left are the big ones. And when the project bombs - and bomb it will one way or another, Accenture will guarantee that because they make money by underbidding and then overcharging you through your nose for CRs and fixing what they failed to deliver under one contractual loophole or another - the people in charge from the customer side always have good cover. They picked the best offer. Nobody could have done it better. This goes hand in hand with Gartner recommendations, the company that came to me with 2 conflicting reports and let me choose which one I want to present to management depending on what version I wanted to push. I laughed them out the door and when going face to face with the higher ups the first thing that came up was "what does Gartner say?". Try answering "anything I want"... They need plausible deniability so you're there to plausibly shield them from the reality of this farce. So you call Gartner back and ask for that report "we first talked about". Nobody gets fired for buying Accenture (or the likes). They'll just leave in disgust.

heavenlyblue 6y ago
In other words, you could hire Accenture and pay some big cat a lot of money, or you could pay 10 startups that money and let 90% of them fail and let someone to become big again.
- buran77 6y ago
  Mathematically yes (a la "9 women can deliver a baby in 1 month"). But in practice no because there's almost no way you can write fair requirements in a procurement that will apply to all and somehow exclude only Accenture (&co.). This is their actual power, officially they tick all the boxes and look as qualified as one can be, and they can also underbid almost any startup. Because they have far more qualified lawyers than engineers to help the make up for it later. It's only when they start work do you get the real Accenture experience: hundreds of inexperienced, unqualified, overworked, or underpaid people under the careful eye of someone who's paid to delay and overcharge under any possible interpretation of the contract. They are better at this game than almost any startup because their game is "winning bids". They are ridiculously connected and able to operate almost exclusively in the grey area, with a lot of detours in dark as hell area. And they are always seen as the "safe choice". If Accenture fails a CEO can say "we did our best, picked the experts". When a startup fails the CEO has no plausible deniability. They went with the risky, unproven option and have to pay the price. You can either go the fair competition route and Accenture can easily tick the boxes on paper and then win on price, or you can go for direct award (in a private company) but you'll be living at the gates of hell until the project is successfully completed.

blaser-waffle 6y ago

Absolutely correct. Saw it on the Gov't/Defense side of the house and in the civilian Enterprise sector. To be blunt, the reason big firms get the contract is because we know where they live, we know they'll deliver something, even if it's utter dogshit, and we know they won't go out of business in 3 years, so if we need to support the build -- or just sue them -- then we know where to find them 36 months from now. The Big 4 may only bat .500 but I can bet against ~50%. There is also a selection bias: no one has heard of the small-fry shops that fuck up, and when they do they can quietly re-brand, disappear, or dissolve. Anyone here ever get burned by YellowOps? Probably not. But everyone here has heard of KPMG...