With the year drawing to a close, one thing seems abundantly clear: There are still an awful lot of ERP and other software projects running off the rails out there.

Software project failures are no fun for anyone involved. They lead to piles of wasted money and effort, heaps of accusations and recriminations, and even to lawsuits. Here’s a look at some of the highest-profile problem projects to surface this year.

UK government scraps the £12 billion National program for IT in the NHS
In September, U.K. officials pulled the plug on what is considered to be the largest public IT project of all time, an attempt to provide electronic health records for all of the country’s citizens.

The sprawling effort was begun in 2002 but failed to produce a workable system, despite massive spending outlays that have been estimated at about £12 billion (US$18.7 billion).

The U.K.’s Major Projects Authority concluded the project was “not fit to provide the modern IT services that the NHS needs.”

“The higher they fly the farther they fall,” said Michael Krigsman, CEO of the consulting firm Asuret, which helps companies run successful IT projects. “They tried to impose a centralized solution onto just an enormous geographic and political base. It was a massive undertaking filled with political differences and technical failures, and in the end it serves as an example of what not to do.”

New York City’s CityTime project
Fallout continued this year over New York’s massive CityTime payroll system project, which has been wracked by cost overruns and a criminal probe into an alleged kickback scheme involving former employees of systems integrator SAIC and a subcontractor, TechnoDyne.

CityTime originally had a $63 million budget, but costs since skyrocketed astonishingly, with total estimates reportedly reaching $760 million.

In June, officials indicted TechnoDyne executives Reddy and Padma Allen. Others, including a number of former SAIC employees, have also been charged.

New York officials are seeking to recover money paid to SAIC. Earlier this month, SAIC said it had set aside a $232 million loss provision in connection with the case.

SAP project woes impact Ingram Micro’s profits — twice
In April, massive technology distributor Ingram Micro announced that problems with an SAP project in Australia had made a significant dent in its first-quarter profits.

Net income stood at $56.3 million, a drop from $70.3 million in the same quarter the previous year, Ingram Micro said at the time. The shortfall was “primarily attributable to difficulties transitioning to a new enterprise system in Australia,” it said.

Ingram Micro went on to stress that the system would provide a great deal of value and efficiency once in place. However, it also warned that its financial results may yet again be impacted by the project’s issues, a premonition that proved true.

In the second quarter, net income stood at $59.7 million, down from $67.7 million in the same period last year, Ingram Micro reported in July. However, the SAP project’s issues had been largely resolved, it said.

Montclair State University sues Oracle over a PeopleSoft project, but Oracle returns fire
In May, Montclair State University in New Jersey filed suit against Oracle, claiming the vendor had completely botched a PeopleSoft project that was supposed to replace the school’s aging legacy systems.

Because of Oracle’s alleged misdeeds, it might cost up to $20 million to finish the project, Montclair has claimed.

But Oracle quickly fired back, claiming that the problems were the school’s fault.

“When issues arose during the course of the project, it became clear that MSU’s leadership did not adequately understand the technology and the steps necessary to complete the project,” Oracle said in a court filing. “Instead of cooperating with Oracle and resolving issues through discussions and collaboration, MSU’s project leadership, motivated by their own agenda and fearful of being blamed for delays, escalated manageable differences into major disputes.”

Montclair recently filed an amended complaint that adds a wealth of detail to its claims, including an allegation that Oracle ran a “rigged” software demo during the sales process and was also guilty of extortion.

Oracle hasn’t commented on Montclair’s latest claims.

Epicor sued by customer over ERP project that turned into a ‘big mess’
Some ERP failures are bigger than others with respect to scope and cost, but they all can have a serious impact on a company’s operations.

Commercial outdoor furniture seller ParknPool took Epicor to court in late November over a “big mess” of an ERP project that it says will results in it taking a loss this year.

ParknPool was looking to move up from its QuickBooks system, which it was outgrowing, Jim Fonner, administrative manager of the Lexington, Virginia, company, told IDG News Service in a previous interview.

It chose Epicor over a Sage system because Epicor’s product seemed more tightly integrated, Fonner said. But nothing seemed to go right once the contract was signed, according to ParknPool, which has about 20 employees.

“Epicor said they could do it in seven weeks. We gave them seven months, and we got zero,” he said in the interview. “I couldn’t even look at a profit-and-loss statement. We couldn’t process orders. We were saying, ‘QuickBooks is so much better than this’ and we were paying $3,500 a year for it.”

In a previous statement, Epicor denied wrongdoing: “Our products, consulting personnel and partner performed well, all of which Epicor believes will be borne out as we defend our position in any proceedings.”

Related Posts:


Comments are closed.