January, 2009

What’s the real trend in failed SAP projects?

The big SAP buzz on the web this week is the claim by Shane and Co. that a failed SAP ERP implementation was a catalyst for the jewelry company’s descent into bankruptcy.

Reporters often joke that anything that happens three times signals a trend. So when you consider Select Comfort’s announcement last month that it was halting its SAP ERP implementation as part of a cost cutting measure, it would seem SAP is one step away from being blamed for business failures in this economy.

But what’s the real story?

Josh Greenbaum points out in his recent blog, basically, that it’s not the software’s fault that you didn’t put it in right. He argues that blame for Shane and Co.’s failings lies more squarely with the management team and the system integrator.

The same theme runs through Michael Krigsman’s chronicles of Miami-Dade School District’s SAP implementation, which is over-schedule and over-budget. Krigsman has been focusing a lot of his ink on the systems integrators’ role, plus management’s mismanagement of the project.

As it turns out, it seems a lot more companies aren’t too happy with their system integrators.

According to survey conducted by Forrester Research, a quarter of 1,002 technology decision-makers interviewed were downright dissatisfied with the work, and only 18% are very happy with it, according to research from Forrester Research’s Liz Herbert.

So how do they get better results?

Predictably, one of the ways to ensure success is by management taking a stronger role in the project. One of the biggest mistakes that companies make, Herbert said, is not changing course or correcting problems when they’re detected and just assuming they’ll correct themselves. Missing or forgoing regular check-ins can contribute to this.

So it would seem that in this economy, stronger project management will be even more important, as the margin for error is slim.

“It’s those consensus-driven companies that really cause projects to fail and to take forever because you can never move forward,” said SAP retail vice president Isaac Krakovsky. “It really does come from the top down.”

Will third-party support get a verdict?

SAP just managed to complete another chapter in its ongoing legal saga with Oracle before 2008 came to a close, requesting a jury trial.

SAP filed its answer to Oracle’s third amended complaint, just before the New Year in the United States District Court in San Francisco.

Meanwhile, another settlement conference is scheduled for next month, and a federal judge has ordered SAP and Oracle to come up with a settlement figure in preparation for it.

While the courtroom battle may have little long-term impact on SAP customers it’s certainly interesting reading. There could be one effect, however — its implications on the availability of third-party software support.

If there’s a monetary settlement, and neither party admits to anything, there may be no answer to just what is and isn’t legal when it comes to third-party support. That may discourage start-ups.

Will a jury verdict better clear up these boundaries, and encourage more providers to spring up? Or is a verdict just as likely to be complicated and ambiguous?

Oracle continues to allege that SAP execs knew TomorrowNow could pose legal problems, and knowingly went forward with an illegal operation. SAP has said TomorrowNow did inappropriately download some Oracle support materials, but SAP didn’t know about it.

“Plaintiffs rely on snippets and excerpts of documents to construct a tale of intrigue, when the truth is far simpler, though less exciting,” according to SAP’s latest filing. “SAP bought [TomorrowNow] with the hope that providing ‘Oracle’ customers a choice in maintenance might give them the time to consider alternative, and better, enterprise software.”

“This case…is simply about whether TN exceeded its rights to access Plaintiffs’ computers, whether that harmed Plaintiffs, and, if so, by how much,” the document states.