April 5th, 2008
UPDATE: $3 billion Census Bureau IT failure
The Census Bureau’s $600 million custom-handheld initiative has finally been scrapped. The upshot: the 2010 census will now cost $3 billion more than planned. Guess those pesky handheld computers are a bit too complicated, so it’s back to paper and pencil methods.
Also see: Billion-dollar IT failure at Census Bureau
THE IT FAILURES ANALYSIS
Let’s parse the official press release, translating government-speak into plain English.
Press release:
“The 2010 Census is one of the highest priorities and most important responsibilities of the Commerce Department…. The situation is unacceptable,” [Secretary U.S. Secretary of Commerce Carlos M.] Gutierrez said. “Over the last month or so, a clear sense has emerged: to have a fully successful 2010 Census, we must immediately revamp some programs, refocus priorities and get on top of the challenges. The American people expect and deserve a timely and accurate Decennial Census and the Department and I won’t rest until they have it.”
Translation: We screwed up and everyone knows. Damn, this sucks.
————
Press release:
Multiple internal and external reviews have identified continuing Census challenges across a number of areas, including adequate planning over key systems requirements, key technology requirements, specification of operational control system characteristics and functions and regional center technology infrastructure. Gutierrez outlined conceptually two major problem areas: the management and implementation of the technology needs of the FDCA effort; and non-FDCA related planning challenges and cost increases.
Translation: This thing was hosed from the beginning. I don’t get paid enough to deal with this crap.
————
Press release:
Gutierrez also announced that management and oversight of the 2010 Census would be strengthened and deepened both at the Census Bureau and at the Department.
Translation: Everyone’s watching, so we gotta deal with it.
————
Press release:
Gutierrez said that the Census Bureau will need an additional $2.2 to $3.0 billion in funding over the next five years to meet the replan needs….The life cycle cost for the Reengineered 2010 Census was estimated at $11.8 billion in the FY 2009 Budget Request, including $1.8 billion for the American Community Survey which replaced the long-form. The new estimated life cycle cost for the 2010 Census is $13.7 to $14.5 billion.
Translation: Glad we could bury this in the press release. Maybe no one’ll really notice?
April 5th, 2008
Twitter’s latest crash graphic
Yeah, Twitter failures are nothing new, but here’s their latest error page. If you want to follow me on Twitter, just click away.
April 4th, 2008
Sales-driven IT failures
The roots of enterprise IT failure often lie in the sales process:
- Sales guy promises the world to customer
- Customer (naively) believes sales guy
- Project fails and customer is shocked
Sales-driven IT failures happen all the time, sometimes leading to serious and highly public recriminations. Waste Management’s recent lawsuit against SAP offers but one example. Larry Dignan summarized the issue well:
At issue is whether SAP promised too much in trying to land Waste Management as a reference customer and whether the customer was duped into using software the German software giant knew wouldn’t work.
Also see: Promises, promises: A look at Waste Management’s case against SAP
Most sales-driven failures are not played out in the press. More often, a project manager is tasked with an impossible project that’s setup to fail. A reader described this problem in an email:
The sales team sells a vision, the technology to achieve that vision, and possibly a vague SOW. The project manager, arriving after the sale, is faced with a big problem: the customer expects great results, there’s new technology on site, the business processes will require major re-engineering before the “real” project can begin, and the time frame is unreasonably short.
We care about this problem because the customer sees “a project” and expects the PM to perform and deliver. But we’re out of scope before the project life cycle takes its first breath.
THE PROJECT FAILURES ANALYSIS
Some vendors, especially R&D-oriented ones, simply don’t allow their sales force to exaggerate claims about product features, performance, or implementation costs and time lines. Sales-focused vendors will tend to accept more white lies in the pursuit of revenue.
Also see: 7 common lies told by enterprise software sales people
But what about the poor project manager? When facing a sales-driven failure, I suggest project managers do the following:
- Find a new job. If sales-driven failures are common in your organization, eventually you’ll become a scapegoat and perhaps fired for problems not of your own making. Life is too short, so plan your escape now.
- Engage in collaborative problem solving. Brings the heads of sales and consulting together for a problem-solving session. Make clear that we have a shared problem. Don’t leave the room until everyone acknowledges that shared planning and joint responsibility will be required to make things right
- Do your best. If the no-win problem becomes your responsibility alone, then apply the best judgment you can muster. That’s about all you can do, aside from seeking help from anyone willing to assist. Remember, the politics around failure are treacherous, so please be careful.
Sales-driven IT failures are a scourge of the enterprise software industry. Whether customer or vendor, don’t accept outlandish claims by sales people — they will come back to bite you.
March 26th, 2008
5 tips to prevent IT extinction
Here are 5 tips to help IT avoid extinction.
I pose this question to IT departments everywhere: “Is your department evolving upwards or fading away on a seemingly-inevitable tide of outsourcing?” If the latter, I suggest you study these points carefully.
1. Recognize and embrace change. Survival depends on our ability to adapt, rather than swim against the tide of economic and social forces over which we have no control.
ZDNet blogger and fellow Enterprise Irregular, Dennis Howlett, describes the human and organizational dimensions of IT-related change:
What we’re seeing is the wholly human problem of an organization that has been variously called upon to deliver ‘value’ from an evolving IT landscape that once placed emphasis on control but which now demands productive innovation. Both demand very different ways of working, require different disciplines and absolutely require change.
Blogger Kate Carruthers is more concrete in her analysis:
I reckon that IT is diverging into two separate streams - firstly mission critical systems, that must be highly reliable and resilient. Secondly non-critical systems that are being democratized. I don’t think any of us want to use medical or financial systems that are user generated, not tested and not highly secure and fault tolerant? But for other business systems I see socialprise as taking over.
So we see the divergence. Where high levels of reliability, redundancy and resilience are required IT departments & engineers are critical. But for the rest roll on the revolution!
Whether one agrees with Kate’s view is beside the point: IT must acknowledge, rather than fight, change.
2. Focus on customers with dedication and intensity. Great customer service requires empathy, experience, and a real desire to serve. Unfortunately, merely being “nice” is sometimes confused with adding customer value, a far loftier goal.
Commenter mlaudisa described his organizational mandate:
[From the previous extinction post:] IT leadership is alienated from senior management.
That would be “POOR IT leadership”… I’m a CIO and I don’t speak to my boss the CEO in technical jargon, but ultimately I’m paid to manage technology, so I better understand my portfolio and be able to translate its relevance & risks to the business.
The commenter understands his value to the enterprise; that’s the basis underlying excellent customer service.
3. Add value through innovation. Despite appearances to the contrary, IT is not doomed to be slave of commodity economics.
Enterprise Irregular and EDS fellow, Charlie Bess, pointedly describes the risk:
[T]hose IT organizations not focused on delivering ever increasing business value (”caretakers”) and actively making decisions about their future will be extinct, since someone will step in and make decision for them or their company.
Blogger Kelly Shaw transforms commodity thinking into high-level IT value:
If all a company needs is vanilla IT, then it doesn’t make sense to maintain an internal IT organization. If all you need is standard power, would you bother generating your own, or would you buy it from the grid? In some cases, however, innovative IT is a strategic weapon, not merely a defensive necessity.
4. Improve communication. IT must communicate its value, pressures, and constraints in straightforward business terms rather than in technical, mumbo jumbo.
Marketer David Politis says:
[J]argon in any form between any technical person and a non-technical person is communications death.
UNLESS (of course) the technical person KNOWS for an absolute certainty that the non-technical person understands the basic, underlying concepts/premises of the matter being discussed. The problem is that such certainty is very, very difficult to attain. Hence, in almost all instances, IT does lose credibility by speaking in technical jargon.
Enterprise Irregular and blogger, Vinnie Mirchandani, expresses IT’s perspective in straightforward, eloquent language:
[T]he CIO or IT is not the enemy. Just a bunch of folks trying to juggle a wide range of competing technology initiatives.”
5. Lose the arrogance. Condescending attitudes toward the business destroy IT’s credibility in the enterprise, making IT weak and vulnerable.
A blog called It Ought to be Simple says it well:
If IT’s condescending attitude resulted in nothing more than a few hurt feelings, it wouldn’t be such an issue. But the attitude causes much bigger problems: It gives IT a free pass, the right to blame mistakes on users…who are, after all, too stupid to know what they’re doing.
Here’s what a CNET blog commenter said:
Users are stupid and that needs to be the starting point…for software developers
Such nonsense undermines IT and only hastens its path toward extinction.
March 25th, 2008
More on dinosaurs and extinction
Yesterday’s post on IT extinction caused quite a ruckus. While preparing my follow-up, fellow Enterprise Irregular and Gartner research director, Thomas Otter, sent this cartoon.
Dear reader, please enjoy it as a brief interlude in our discussion.
March 23rd, 2008
Is IT becoming extinct?
Update 3/26/08: Also see 5 tips to prevent IT extinction.
Since the days of punch cards, IT has believed itself to be guardian of precious computing resources against attacks from non-technical barbarians known as “users.” This arrogant attitude, born of once-practical necessity in the era of early data centers, reflects inability to adapt to present-day realities. Such attitudes, combined with recent technological and social changes, are pushing IT to share the fate of long-extinct dinosaurs.
While ITs demise won’t happen overnight, the trend is clear. Here’s why:
IT services have become a commodity. Nick Carr’s article, IT Doesn’t Matter, described infrastructure computing as a baseline of plain vanilla IT services. In this new world, IT is caretaker rather than strategic business partner or visionary. According to Nick:
[As the availability of standardized IT resources] increases and their cost decreases — as they become ubiquitous — they become commodity inputs. From a strategic standpoint, they become invisible; they no longer matter.
Social media empowers users at the expense of IT. Enterprise 2.0 companies marginalize IT by putting powerful tools directly into the hands of non-technical workers, bypassing IT in the process. Dennis Howlett says traction is already there:
The outwardly facing socialprise applications and services I am seeing are not just fundamentally different in approach, they are proving successful.
Software as a service (SaaS) providers are replacing in-house IT infrastructures. Low-cost, external software providers are building and maintaining network, and support, services previously belonging to IT. It’s great for the enterprise, but reduces ITs power, influence, and budget. Phil Wainewright, an expert in these matters, wrote:
The entire framework of how businesses consume computing and thus automate their information and communication processes is moving to a services model that runs on the global Web infrastructure.
IT leadership is alienated from senior management. IT loses credibility by speaking in technical jargon and failing to deliver core projects on time and within budget. Any discussion of poor alignment between IT and business raises basic questions about ITs strategic contributions to the enterprise. JP Rangaswami, CIO of British Telecom, told me:
The idea that you could take a critical function within an enterprise and state that it is “not business” is insane….[E]verybody and everything should be about creating new business value on behalf of the customer. [W]e have conned ourselves into believing there are separations to justify organization charts where people build empires, when actually you [should] have a bunch of people taking accountability for different facets of the business.
[W]e have to get to the idea that we’re all in this together, because we are in business together, and we are in the business of delivering value to our customers.
Corporate leadership doesn’t understand the implications of IT decisions on business strategy. While IT is partially responsible for its own downfall, senior management is also culpable. On this subject, I wrote:
[M]any senior business executives don’t fully understand how IT processes function, nor do they completely grasp the ramifications that technical decisions can have on non-technical business strategies.
Noted author and project failures guru, Ed Yourdon, told me:
It’s amazing today how many senior executives don’t even read their own email. It’s mind boggling, but these people are going to die off sooner or later.
As the older generation of marketing- and finance-oriented, computer-illiterate senior managers die off and retire, you’ll gradually see a new generation coming in that is fully comfortable with the day-to-day activity and the strategic possibilities of IT, and who will be able to work more closely with CIOs.
Volume purchasing arrangements contribute to IT stagnation. Traditional software companies implicitly conspire with purchasing departments to maintain the status quo. Centralized purchasing policies support volume license deals, but inhibit individual users from adopting innovative new products. Although established software companies love this system, dissatisfied users blame IT, further damaging its credibility. Microsoft’s Lawrence Liu commented on a blog post critical of his employer:
Microsoft is the only company in the world that can help organizations effectively integrate the future, present, and past IT capabilities to solve their business problems. Re: all the newfangled social software in the market these days, it’s great to see customers experimenting with this or that, but ultimately, they’ll understand [things are complicated and Microsoft is the answer.]
Microsoft pushes IT, the purchasing department obliges, users become unhappy, and IT moves inexorably towards its own demise, in the form of long-term institutional suicide.
The IT-killing external ecosystem is well funded. Venture capitalists are actively investing in business models that reduce ITs role in the enterprise landscape. Here’s one example from Bryan Stolle, a VC:
Another evolution of the SaaS model is simply offering a software-powered service that is delivered as an outsourced business process. The best example of this is ADP: rather than sell you software to do your payroll, we’ll just do it for you.
Market forces are conspiring against the status quo, to the benefit of users and the detriment of traditional IT.
=========
My next post will offer advice for preventing IT extinction. Whether you’re a senior executive or a technical IT person, be sure to catch our upcoming episode!
Update 3/24/08: Welcome Digg users! Thanks for coming.
March 21st, 2008
QA failure in Yahoo unlimited email
Yahoo’s unlimited storage email service fails under certain conditions that prevent users from accessing their mail. Most likely, poor testing is to blame.
According to The Wall Street Journal, when users leave too many messages directly in their inbox, login becomes impossible:
Whenever we tried to log on, we got a “LaunchCascadeError-ymws:Server.MailboxOpenFailed” error message.
Turns out Yahoo isn’t really prepared for users doing what we do–namely keeping all their mail in a single inbox–as opposed to moving them into sub-folders. (We don’t spend any time sorting because doing so defeats the whole purpose of having a single back-up email system that doesn’t require any thought or tending.) When the number of emails in a single folder gets too big, a Yahoo Mail account crashes and burns.
Here’s how Yahoo describes its unlimited storage email service:
Unlimited storage gives normal email account users like you an opportunity to not have to worry about hitting a storage limit. Basically, the idea is that now you can save your correspondence and memories and never worry about deleting older messages to make room for more.
THE IT PROJECT FAILURES ANALYSIS
I suspect the development and QA folks didn’t think the product would be used as described by the Journal and therefore didn’t test for that situation. Yahoo should have conducted boundary testing specifically to see what happens when a user’s inbox is loaded with lots of messages.
Here’s what the XSLT Cookbook, 2nd Edition says about boundary-condition testing:
In all programming languages, bugs most often appear at boundary conditions. Thus, you should choose test data in which values lie along data extremes. Boundary values include maximum, minimum, and just inside/outside boundaries.
Yahoo responded to the Journal saying: “You’re using the product exactly how we want it used.” Obviously, PR and development don’t talk enough.
Yahoo says the fix will take about a month.
March 20th, 2008
Billion-dollar IT failure at Census Bureau
The US Census Bureau faces cost overruns up to $2 billion on an IT initiative replacing paper-based data collection methods with specialized handheld devices for the upcoming 2010 census. The Bureau has not implemented longstanding Government Accountability Office (GAO) recommendations and may therefore be forced to scrap the program. Harris Corp., the contractor associated with this incompetently managed initiative, was awarded a $600 million contract to develop the handhelds and related software.
In March 5, 2008 testimony before the Senate, Commerce Secretary Carlos M. Gutierrez said: “There is no question that both the Census Bureau and Harris could have done things differently and better over the past couple of years.”
On the same date, Census Bureau Director, Steve H. Murdock, added:
I cannot over-emphasize the seriousness of this problem. My colleagues and I recognize that we must move quickly to address this problem, and implement solutions. While we still have an enormous challenge in front of us, I am confident that we are close to defining and implementing a strategy that will ensure a successful 2010 Census.
The GAO characterized the handheld initiative, known as the Field Data Collection Automation (FDCA) program, as follows:
Of the $11 billion total estimated cost of the 2010 Census, the Census Bureau planned (as of 2007) to spend about $3 billion on automation and information technology in order to improve census coverage, accuracy, and efficiency. Among other things, the Bureau is planning to automate many of its planned field data collection activities as a way to reduce costs and improve data quality and operational efficiency.
The GAO report, dated March 8, 2008, added:
In October 2007, GAO concluded that without effective management of key risks, the Field Data Collection Automation (FDCA) program responsible for the devices faced an increased probability that the system would not be delivered on schedule and within budget or perform as expected. The magnitude of these problems is not clear…. [T]he Bureau has not performed recommended analysis or provided sufficient information to provide a level of confidence in its $11.5 billion life-cycle cost estimate of the decennial census. The Bureau has not itemized the estimated costs of each component operation, conducted sensitivity analysis on cost drivers, or provided an explanation of significant changes in the assumptions on which these costs are based. Together, these weaknesses and actions raise serious questions about the Bureau’s preparations for conducting the 2010 Census.
Computer World blogger, Frank Hayes, summarized the situation succinctly, “The fancy custom handhelds might work. But if they don’t, the Census Bureau will use paper instead.”
THE IT PROJECT FAILURES ANALYSIS
Managing an $11 billion initiative is a daunting task and unforeseen problems are inevitable. Nonetheless, the GAO, going back to January, 2005, repeatedly identified significant procurement, management, and operational risks associated with this project. For reasons unknown, the Census Bureau chose not to follow these recommendations.
The following table summarizes significant project issues identified by the GAO:
How does a failure of this magnitude arise? Clearly, Census Bureau management is ineffective at properly and efficiently executing the organization’s basic mandate. A detailed analysis would probably reveal hidden agendas; conflicts of interest; good intentions gone bad; inexperienced, lazy, and incompetent management; lack of controls; and plain old poor judgment. I believe these deeply ingrained issues are symptomatic of fundamental problems shared by both Bureau leadership and line management.
My recommendation: The GAO must conduct a formal inquiry into two specific areas:
- It should investigate and analyze the management policies and procedures that allowed this situation to develop and persist over the course of several years. We must understand why program controls didn’t prevent this huge waste of dollars.
- It should perform a detailed (and I mean exhaustive) investigation of Harris Corp.’s role. Let an unbiased panel determine what percentage of the billion-dollar waste Harris caused and force the company to pay direct restitution for that amount.
Until the government holds contractors and their agency sponsors accountable, massive failures will continue and more money will be flushed down the drain.
March 18th, 2008
Guy Kawasaki achieves tech support greatness
What will those wild and crazy Web 2.0 guys think of next?
Guy Kawasaki, friendly proprietor of alltop.com, offered a MacBook Air loaner to one of his users — all because the site was too slow on her iPhone. This officially qualifies Guy as offering the best tech support in the known universe. Enterprise software companies take note; this is the level of service we want from you!
Here’s the exchange, which took place on Twitter (click to follow me):
I asked Guy (over Twitter, of course) whether this is standard policy. His response: “? was tyypooo.”
March 18th, 2008
7 common lies told by enterprise software sales people
Ever meet an enterprise software salesperson you could trust? While such paragons of virtue exist, they seem the exception rather than the rule. Here are 7 common lies used by some way too many enterprise solution providers during the sales process.
Also see: Sales-driven IT failures
The lies are drawn from Confessions of an Ex-Enterprise Salesperson (free download), by Doug Mitchell, who founded RentalMetrics, a management consulting firm for the construction equipment rental sector, after working for years in the enterprise solutions business. Doug told me he wrote the book to “break through the hype” surrounding enterprise software sales.
Lie 1. My solution is the one that best meets your needs
When I said, “My solution is the one that best meets your needs,” what I meant was that I’m going to do my darnedest to shoe horn my product into your world so that you’ll buy my stuff versus the competitors.
You [shouldn’t] buy products because they have this or that. [B]uy them because of what they’ll do for you and the ecosystem you operate within.
Key questions to ask the sales person: What 3 companies are your fiercest competitors and what would they say they do better than you? The last time you lost a deal to your competition, what were the main reasons given?
Lie 2. My solution does not require much of your company’s IT resources
When I said, “My solution does not require much of your company’s IT resources,” what I meant was that with a 95% degree of certainty, your IT department will be the biggest roadblock to success that we’ll encounter in this project.
Key questions to ask the sales person: When (not if) you run into smoke screens, road blocks, and obstacles thrown up my IT department, are you prepared to deal with them and how? If we cut through all of the crap, how much time does it really take to deploy this solution, excluding training?
Lie 3. My solution is supported well
When I said that, “My solution is supported well and my company hangs its hat on the best service in the industry,” what I meant was that when you call, a human will pick up the phone and get on your problem right away, delaying someone else’s due date for customized solution delivery.
The bottom line with custom software in the enterprise is that it breaks. How many times have you rebooted today?
Key questions to ask the sales person: Do you have an automated system or a human system when I call your support line? What bug tracking or trouble ticket solution to you use? What your average time from call in to resolution? What is your process for escalation?
Lie 4. My solution will save you time and money
When I said, “My solution will save you time and money,” what I meant was that your company will probably achieve enough Return On Investment to pay for the solution…but you’ll end up using 10% of what the solution can do and end up frustrated after the honeymoon period.
Most enterprise solutions have evolved because complex businesses have insisted that new features be built as a condition of sale.
Key questions to ask the sales person: What percentage of features in this system do your clients typically use? If I want to reduce the training required by half to save money, will you let me?
Lie 5. That will take 2…maybe 3 weeks to develop
When I said, “That will take 2 maybe 3 weeks to develop”, what I meant was I really don’t know how long your customization will take so I’m throwing out a number that will get you to bite…not balk.”
If the delivery dates of complex customizations seems unrealistic…even to you, they probably are.
Key questions to ask the sales person: What is your process for documenting change requests? If your development efforts fall behind schedule, what’s my compensation?
Lie 6. Here are my prices
When I said, “Here are my prices”, what I meant was “My price is totally flexible and within reason I’ll probably say yes to lowering them because we need your upfront money and recurring revenue more than I need my pride.”
Pricing enterprise solutions is far more art than science. Often it’s more about discovering the target’s pain tolerance.
Key questions to ask the sales person: How much does the solution cost? What’s the typical payback or return on investment you’ve measured when companies like mine have deployed your solution and can you provide me case studies?
Lie 7. Here are my contract terms and conditions
When I said, “Here are my contract terms and conditions”, what I meant was “This is pretty much a boiler plate agreement that no one reads so if you challenge some terms…you’ll probably get what you want.”
[M]ost enterprise solution firms don’t even know what the terms in their own contract mean. If something appears strange to you or is unclear, challenge it. Don’t be afraid.
Key questions to ask the sales person: Is this agreement flexible and negotiable? What’s the one contract term that clients challenge the most?”
THE PROJECT FAILURES ANALYSIS
If you’re contemplating an enterprise solution, read Doug’s book to help protect your own hide from evil, miscreant, and wayward sales people. I really enjoy how his sardonic humor matches the subject matter. For example:
On lying:
Is lying requisite? No. Sales people are not lying, they are simply framing the truth in a way that closes the deal and provides a big payday [for the sales person].
On enterprise solution (ES) pricing:
The ES is often quite expensive to buy upfront. This upfront price loading is where the ES software company recovers the immense cost of sales associated with the ES including commissions, bonus payments to company officers, investor dividends, and really nice cars for the President.
On the subject of enterprise sales people:
Better enterprise solution selling organizations send two people on the tactical assault mission: One suit. One techie. The suit acts as translator when the techie…lays out something intelligent for your consumption. That back and forth tech translation orgy is meant to disarm the prospective buyer or baffle him sufficiently into writing a check for the panacea product that will make his boss happy with him…or close out the never ending 6-Sigma project from hell.
My take: Doug’s book will help you recognize and avoid common tactics frequently perpetrated by sales people on unsuspecting enterprise buyers.
Michael Krigsman is CEO of Asuret, Inc., a software and consulting company dedicated to reducing software implementation failures. See his full profile and disclosure of his industry affiliations.
Recent Entries
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