When Fixed-Fee Projects Fail: Were You Invested Enough?
So, it seems another fixed-fee implementation project has failed and resulted in a lawsuit pitting the buyer against the implementer. Somehow I don’t think this is the outcome that either of them wanted, yet I sense an undertone of suspicion that hinted at this early on. Implementations go best when the system integrator is a partner with the organization who has purchased the software. It has to be a joint effort or it simply won’t work.
I talk with many organizations who are buying an ERP solution for the first time and we always get around to discussing implementation strategies. I often remind them that they can implement the software themselves, but “trial and error” is not a very good implementation strategy for an effective and cost-efficient project. At the other end of the spectrum, you hire a consulting firm, but you can’t expect them to do 100% of the work and produce anything meaningful. You, as the owner must make certain decisions, change business processes, and generally make an investment in your software to properly prepare yourself to take ownership of your new solution. To allow the system integrator to make every decision, set-up every table, and develop every interface is a recipe for another failed project.
While a fixed-fee approach can work in certain situations, it rarely creates the bond or partnership needed to share effort, responsibility, and even blame, especially in a large project. It has tangible, inherent risk by its very definition It tends to draw a line in the sand that neither the owner nor the implementer are willing to cross. Unfortunately, that chasm is more often than not too much to overcome and reach a successful outcome.
In fact, the outcome usually ends with lawyers, not celebrations.
Something to consider when thinking about how you want your next big project to go.
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More links:
MIPRO Consulting main website.
