How on earth can anyone manage to overspend £9bn on IT?

After all its all done by cheap labour in India isn’t it? How come it all somehow seems to cost so much?

Context?

Seeing how much time and money 3 people have wasted over 5 years on a small, but pointless IT project where I am, it doesn’t seem that difficult 🙂

Maybe they carried away bidding for a laptop in Ebay?

Well, this was two and a half years ago, but there’s been quite a lot of talk on R4 recently about it

there’s a lot of IT types riding very shiny bikes on this forum

Really? 😯

Given the link, I’d suggest there is another common factor apart from IT (which is also a common factor in various other non-IT overspending projects).

here’s a lot of IT types riding very shiny bikes on this forum

hear hear.

There are also a lot of IT types spending a lot of time looking at this site in office hours. *waves*

a friend of mine worked on a major IT contract for the government. the problem seems to be goalposts that move faster than the speed of light

good rant retraction

Consultancies, basically. IBM, CMG, Logica, they’re all at it. They get govt projects and screw them for all the taxpayer’s money they can grab.

Did you know for instance that a programmer on say £45k a year salary gets hired out for easily £1,200 PER DAY… where does all that money go?

It’s a scam.

S-A-P

They get govt projects and screw them for all the taxpayer’s money they can grab.

Simply not true I’m afraid.

If you take the recent report NAO report that was being discussed this morning on the Today programme, that is the MoJ National Offender Management Information System, you see that no where did the consultants (I think you mean supplier) get mentioned as the prime reason for the project’s failure, I’m not saying that EDS were not culpable in this but what is so often overlooked is that it’s a partnership between supplier and customer and that if the requirement is not made clear, and proper governance is not in place from the beginning then invevitably these things will go wrong.

NAO head Tim Burr said: “These problems could have been avoided if the National Offender Management Service had established realistic budget, timescales and governance for the project at the start and followed basic project management principles in its implementation.”

that’s the project my friend worked on, he left because there was just no chance it would ever work

EDS

There’s your answer

durrrrr, wrong answer

So basically its about bad clients and hard nosed businessmen making sure that the bad client ends up paying because they have
a) no real idea what they want
b) an inability to make their minds up
c) no idea that every time you change something it affects cost and programme

Still is an awful lot of money though

You generally get overspend because the conversation goes something like this

Customer – “we’d like a system to do A, B and C please”

IT company – “certainly, that will cost x”

Customer – “oh, actually, we’d like D as well”

IT company – “okay, but it’ll cost more”

Customer – “oh, and we’d like to change B”

IT company – “okay, but it’ll cost more”

Customer – “oh, and A”

IT company – “okay, but it’ll cost more”

Customer – “oh, and instead of C, can we have F?”

IT company – “okay, but it’ll cost more”

Customer – “er, we’ve changed our mind about D”

IT company – “okay, but it’ll cost more”

etc etc etc…

Imagine you’re a contractor building an office block, and then when you’re up to the fourteenth floor the customer decides they want an underground car-park…

Well Nick, I’m working on a govt project that was started by a major consultancy and then they were fired and another major consultancy, and then they were fired and private contractors brought in. And what you say is true, most govt places can’t spec a project to save their lives, but to be honest for the money that the big six get paid they should be able to take them through the process and make things clear. In our case the requirements were supposed to be extracted by the consultancy not by the customer. This did happen but even their requirements were rubbish. They also sent us down certain technological routes that cost us a lot of time and money.

The project did overrun, but not critically so – we made our last ditch deadline. The thing is, because private contractors were so much cheaper then overrunnning cost us a fraction of what it would’ve done. The big problem with the consultancies has to be cost. They stiff you on rates in my opinion and you don’t get better quality work. Then they insist that you pay through the nose for any changes.

Of course, spec creep is a terrible thing but so is being rigidly not adaptable. When the customer came to us contractors and said that they’d missed something out and needed us to do it, we did it. What we did would never have got done with consultancies – you’d have been reading about it in the papers – as it is, you’ve heard nothing.

Imagine you’re a contractor building an office block, and then when you’re up to the fourteenth floor the customer decides they want an underground car-park…

I give you…

The Scottish Parliament.

cost rising from £40 million to £375 million.

Goalposts moving, scope creep, poorly specc’ed projects, poorly defined requirements, mis-management, too many parties involved without one being responsible for the outcome, lack of decision making etc.

Add to that, incompetence, resistance to change by users, poor adoption of technology, hardware/software issues and bugs, performance problems and poor training and you probably have a checklist for most late, over budget or cancelled IT projects and programmes.

I’m starting to think I could lecture on this stuff after years of bailing out doomed projects as a troubleshooter.

Best advice I’ve ever had/given…. When joining any project point out it is screwed. Then if you turn it around you get the credit, if you don’t it was screwed in the first place!

Well Stoner that was a lesson in bad estimating (40 million for a large development in Edinburgh, you’d have been lucky to buy the land for that), a poor contract that loaded all the risk onto the client, and poor project management (i.e. by committee).

This sort of thing happens everywhere. I think of my job as trying to make sure that the client gets what they need, which is not necessarily what they want or ask for as for the most part they don’t actually understand what the problems are.

+1 on the consultancy thing.

There was a case recently where a (slimey) Cognos consultancy went into a big financial company and spec’d out a new BI infrastructure, the person doing the job had no idea what he was doing (literally) and basically gave them about 4 times as many servers as they needed. the firm stayed there for 12 weeks, then stated that they weren’t getting co-operation from the customer and walked off site, reputation in tact despite not delivering anything. 4 consultants x £1520 a day for 12 weeks. They do this at every site they go to.

good rant retraction

fair cop, mr-m-w. the edit button is a wonderful thing. It was my usual beleaugured and underpaid nhs worker rant by the way. You didn’t miss much.

and yes, ‘client moving goalposts’ is a horrendous problem. We (nhs trust) had an IT company once who would announced that they were going to update a big piece of software and its associated database every so often, and it was up to us to decide what we would like changed and agree it with them before each update. thus grumbles could be ‘saved up’ and dealt with at sensible intervals instead of changing like the wind.

Civil servants are familiar with buidings in a way that they are not familiar with IT. And they know when to stop tinkering with a building whereas may have unrealistic expectations about what can be done in IT at what cost.

Stoner I see you and raise

£511million when that was alot of money 😉
As we privatised the agencies the project management skills were lost to the government.

if my budget constraints got lifted tomorrow, i reckon i could have a good go at spending £9billion on IT stuff here… make up for lost time, so to speak.

A very good friend of mine did some consultancy work for a local council in lancashire, his job was to over see the lcoal council IT department’s buying of a complete new IT system from a scandinavian company. any how to cut it short after 4 weeks he realised they where buying into a complete turkey, he conveyed this message to the powers that be but alas they told him he didn’t know what he was on about. So he left they bought the system costing 12 million and low and behold they realised they had indeed made a massive balls up, but hey what the f-ck it is only the tax payers money!!!!!! 3 years later and they are still using thier old system.

As an IT Consultant (Oracle Apps) I’ve worked in a variety of places and it does wind me up the way the councils I have worked for appear to care far less about getting value for money than private companies. I worked on EDS’s JPA implementation which must have cost a bit – EDS were throwing resources at it so as not to incur penalties; system didn’t work so well initially…you can google it. I wonder how much SAP and Oracle invest in their ERP systems; far more compex than any system I can think of.

a) no real idea what they want
b) an inability to make their minds up
c) no idea that every time you change something it affects cost and programme

In my opinion, for £1200/day, the consultancy should be able to manage this properly. They should not just be there to knock out code and project plans, it should be more guiding than that.

But then again, that’s what they tried to do here and it failed miserably. Like I say the only reason it’s not all over the papers as a great big failure is because of us private contractors.

If the public sector ordered a house they would:
– ask for a top storey flat on a high rise with 3 beds
– then want 2 beds
– then want a patio
– then commplain the garden was too small
– then suggest a bungalow might be better
It’s important to to get lots of people involved as if somebody took responsibility it might be hard for them to shift the blame, and in order to increase your visibility/profile/cock size in the organisation you (and every other cock) needs to be seen to be involved and have their say. I’d suggest continously changing the sign off authority as that’ll make it take much longer and cost considerably more so that you really can ferk it up.

Real life example. I was so impressed with the Bournemouth ‘surf reef’ contract (verbal report on BBC by local councillor) that I will try to get some business out of them:
– how much did it cost? – 3 million
– how much do you get back if it doesn’t work? – 150,000
(or read into that considerably less than their profit margin – punish me big boy ….)

I know plenty of people who work in IT for the DWP and other government projects. Being incredibly slow is their major complaint. Also goalposts change a lot and very quickly. At our place where a project is initiated on Monday, we get engaged on Tuesday, the solution is designed by Wednesday, the change is raised and implemented ON friday and then we’ll spend all weekend fixing the bugs in it. One chap who left here to go to DWP was taken in and was given 2 months to review a solution. 2 MONTHS! And then when he wwent back with the results they asked him if he needed more time.

Suits him but I’d die of boredom.

IT projects going wrong are almost always because the customer is incapable of expressing (or even understanding) what they actually want / need.

Government projects seem to be the worst in this regard – and as others have said, not just in IT.

Dont moan too much, any overspend will help lift us out of the recession 🙂

IT projects going wrong are almost always because the customer is incapable of expressing (or even understanding) what they actually want / need.

Yes. The reason the goalposts keep changing is because they don’t know what they want in the first place. Rather than just pitching up and saying “Right, whaddya want?” consultancies should have specialists to sit down and work out what they actually do need. Oh wait – they do.

Partly that struggles because some of the people think they are experts in everything to do with their job, but they’re not. They haven’t a clue how to specify IT, or what works and what doesn’t.

Read Dilbert daily for an understanding of this type of thing.

Its a two way process – numpties with no idea on all sides.

Isn’t it the case that there are many IT failures of similar scale in commercial organisations but because they are not open to scrutiny these c0kups can be hidden from view?

I bet there are some corkers in the Insurance / Finance world – big legacy systems, data silos, crap data quality = reet old crap.

And read Nurstoons for an understanding of why the NHS is ****?

At least Dilbert is funny.

Nick – nurstoons is too real for words. Not read it for a while but it cuts very close at times