It's the new year so it's time for another lawsuit about a failed ERP implementation. The contestants in this upcoming battle are Avande (a joint venture between Microsoft and Accenture) and South Carolina based ScanSource, who are filing suit for an overpriced and rather late system. The suit claims that Avanade promised a Microsoft Dynamics AX system for $17 million to be delivered in 11 months. What they say they got was a system that ended up costing $66 million delivered after three years. The lawsuit goes into a number of other issues such as Avanade's misrepresentation its "skills and abilities" in order to win the contract, but then staffing the project with a revolving door of consultants who knew little or nothing about implementing Microsoft Dynamics AX". It's not like we haven't heard that one before. ScanSource terminated the contact with Avanade last September and has now hired another company to fix their problems. The estimated cost of fixing the current issues is in the range of $58 and $72 million, and may not be finished until 2014.
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I work for an end-user after working 10 years for consulting firms, like Accenture and Bearingpoint. I found that each project I went on the consultants were younger (just out of college) or from abroad with little understanding of the product we were implementing, the work culture in the US, and in some instances the language. I was glad to get out of those companies and to a firm that was established, cared about the customers, and did what they say they are going to do. Our company hires very few consultants and in the most part they are independents with very many years of experience. If you think you are getting a deal with the big companies, you may find you are not.
I was a consultant for a “BIG” SAP implementor in France and I came to the US to work on a project. The company we helped implement SAP (and Peoplesoft) decided that after we implemented that they thought it did not fit their design, although we did not design their system, they did. But it did not got to court, as the company I worked or decided to refund almost half of the implementation fees back. But this was never on the news, and never saw anything in the media. In fact it was like the implementation never existed and I was told (when I was back in France) that I should not put that project on my resume. So I wonder how many other projects end up like this with the client deciding that they want refunds for a poor job (or not a poor job).
Our company implemented Microsoft Dynamics about three years ago with an implementation partner that no-one had heard of, but they had staff who had been in consulting for fifteen to twenty years. They brought the team to the orals and said this was the team, no changes. Accenture, Bearingpoint and EDS came to the orals with a bunch of sales people and a few consultants who it seemed were just unassigned and looking for something to do to keep them busy. When we asked where the teams were all three companies gave us a list of resumes of consultants who may or may not have been on the team. I think all three firms believed that they would win the work on cost, and yes they were all cheaper than the firm we selected, but we actually got to talk to the team who showed up, questioned them, picked their brains, and in the end we felt very comfortable with them. So I am not surprised when I hear of Accenture or other firms having a revolving door of consultants.
Never been a big fan of Accenture since they helped us with a Peoplesoft implementation a few years ago and it was over budget and delayed at least three times. Was the failure their fault, perhaps not totally, but you would think that with years of implementation experience that they would figure out that low-balling the client as far as overall cost and proposing a short timeline is not the way to win business, or perhaps it is?
I was a developer on a SAP project for a big medical project in Canada. The problem for us as developers was that the functional specifications created by the implementation team were very poor. The team was made up of young consultants will no knowledge of the medical industry, so they did not really understand what they were designing. So when we developed the code it was wrong. We followed the specifications, but they were poor. The project was very late and I am not sure if it ever did what the company said it should do.
After university I joined a large consulting company as a junior SAP consultant. I did not do much computing at university, but I was told that I would be good at it by the recruiters. My first project was in Toronto and I was asked to review the design specifications that had been developed by a previous consultant. I had no idea what I was doing, I had not worked in any industry before I joined the consulting company and the customer expected me to have years of experience. I felt very bad for them as they were paying a lot of money for me to learn. But I am told this is normal for some consulting companies. I still felt very bad.
Having worked for a company who was implementing Lawson software a few years ago I can attest to the fact that these big consulting firms bring in totally green folks and expect companies to pay top dollar while they get on the job training. The company I worked for complained time and time again but got nowhere and in fact at one point it seemed as they were being held hostage by the consulting firm. It was a total waste of money. The project was not completed on-time and when the consulting firm’s contract ended, the budget was already exceeded by 30%. In the end, the company brought in a few independent consultants and a couple of experienced consultants from another big firm to finish it off.
I was working with someone who was part of the Ingram Micro project. It was an Australian SAP project that seemed to go on for ever, but finally made the top 10 list of ERP failures for 2011. That company lost a bunch of money over a six month period because the software didn’t let them ship products. Not sure if it was SAP or the implementors fault.
Consulting firms don’t have good reputations because of these exact reasons – over price, extending the length of the project and bringing on junior consultant to learn on the job.
Accenture is the old Andersen Consulting. Look what they did at Enron! Why do you think we now have SOX? They come into the client company and replace the long-time employees with their expensive recent-college-graduate consultants, thereby inflating the cost and reducing the expertise.