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ERP
THE DEVILS TRIANGLE
IN ACTION

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The Devils Triangle in Action
Friday, February 22, 2013

I came across this article in the Computerworld magazine (following) which highlights the interaction of the different players in the “Devils Triangle”.

The scenario unfolding here is one of an organisation not knowing what they were doing and over-relying on third parties to supply implement an ERP system in the belief the third parties had the clients interest at heart.


Key points: (observations company)

Did the company have a model with specific operating requirements to simulate software through?

Was there a thorough risk analysis carried out?

Were the contractors properly checked for experience before being allowed on site?

Were contract payments linked to successfully achieved milestone achievements?

Did company’s own project manager raise concerns with top management?

Were top management involved other than at a superficial level?

Clearly the company had a lot of things it could have done to mitigate the disaster.


Key points: (observations vendor)

Did the vendor even attempt to match client requirements with product?

Did the vendor misrepresent the product and skill capability?

Did the contractor staff have necessary skills that the client required?

Did the vendor mislead the client

Was the vendor/contractors aware of the inherent risks and advise the client at a level of management relevant to the unfolding probability of failure?

Did the vendor/contractors even recognise the potential problems and the impact on the project outcome?

Undoubtedly a settlement will be made or the courts will decide the level of culpability in the matter but as always the client will be the victim in the end run.

Avantor has suffered tens of millions of dollars in monetary damages, as well as taken a hit to its reputation among partners and customers, the suit states.”

In all cases all parties have to accept responsibility for the project succeeding or failing. (The Devils Triangle) The real question is: Who sold their services and should have known the risks and probable outcomes based on the information available to them and their touted or implied expertise?

Who took the money (and in great amounts) for a service they allegedly ultimately did not deliver on?


Now read from the article!

Manufacturer sues IBM over SAP project 'disaster' (Excerpts from article out of Computerworld)

“IBM has been slapped with a multimillion-dollar lawsuit by chemical products manufacturer Avantor Performance Materials, which alleges that IBM lied about the suitability of an SAPbased software package it sells in order to win Avantor's business. In 2010, Avantor decided to upgrade its ERP (enterprise resource planning) platform to SAP software, according to the lawsuit, filed Thursday in U.S. District Court for the District of New Jersey.

"Seizing upon Avantor's decision -- and fully aware that, given the competitive pressures of Avantor's industry, and the specialized demands of its customers, Avantor could not tolerate any disruptions in customer service -- IBM represented that IBM's 'Express Life Sciences Solution' ... was uniquely suited to Avantor's business," the lawsuit states. "The Express Solution is a proprietary IBM pre-packaged software solution that runs on an SAP platform." But Avantor discovered a different truth after signing on with IBM, finding that Express Life was "woefully unsuited" to its business and the implementation brought its operations to "a near standstill," according to the suit.

IBM also violated its contract by staffing the project with "incompetent and reckless consultants" who made "numerous design, configuration and programming errors," it states. In addition, IBM "intentionally or recklessly failed" to tell Avantor about risks to the project and hurried towards a go-live date, the suit alleges.

"To conceal the System's defects and functional gaps, IBM ignored the results of its own prego- live tests, conducted inadequate and truncated testing and instead recommended that Avantor proceed with the go-live as scheduled -- even though Avantor had repeatedly emphasized to IBM that meeting a projected go-live date was far less important than having a fully functional System that would not disrupt Avantor's ability to service its customers," the suit states.

The resulting go-live, which occurred in May, "was a disaster," with the system failing toprocess orders properly, losing some orders altogether, failing to generate need paperwork for U.S. Customs officials and directing "that dangerous chemicals be stored in inappropriate locations," the suit states.

Avantor has suffered tens of millions of dollars in monetary damages, as well as taken a hit to its reputation among partners and customers, the suit states.”

This scenario could have been avoided by the application of the 26 points whereby the company would have been in control from the start and have identified the product fit was not suitable for the company by simulating the software through the model and identifying the shortcomings. This would have been a show-stopper from the beginning.

They could have saved themselves millions of dollars in losses by taking a bigger picture look at the entire project and not simply believed the ERP supplier and his implementation partners/contractors.