Fulfilling customer requirements is a weapon at IBM
There are several new data points this week in the ongoing cratering of IBM as an IT vendor. The state of Pennsylvania cancelled an unemployment compensation system contract that was 42 months behind and $60 million over budget. Big Blue has been banned from the Australian state of Queensland after botching a $6.9 million SAP project that will now reportedly cost the people of Queensland $A1.2 billion to fix. That’s some botch.
Credit Suisse analyst Kulbinder Garcha says IBM has a cash flow problem and downgraded the stock. At IBM’s Systems & Technology Group, management announced to employees a one week mandatory furlough at the end of August or beginning of September. And finally, I’m told that there is now a filter on the IBM corporate e-mail system that flags any messages that contain the word Cringely. I’m flattered.
These are acts of desperation and I can only conclude that IBM can no longer make the decisions necessary to save itself. It is so fixated on its goals and so sure its process is the only right way of doing things, it cannot see alternatives.
The Australian IT project debacle is a classic example of IBM’s unique way of managing projects. The core of project management is "documented deniability". It will do exactly what you tell it. It will document it. It will work against the documented requirements. When done, you have to pay the firm because it did exactly what you told it. The key problem to this approach is "does it work?"
The ultimate goal of every project is to build something that produces value or income. A factory makes products. A bridge assists transportation. In IBM’s project management IBM does not care about the ultimate goal. That is its customers concern, not IBM’s. This is very important for IBM’s customers to understand. It is the reason so many big IBM projects are failing.
This is the way IBM historically does its business, even in better times. Remember the mantra has always been to fulfill customer requirements. But somewhere along the line the whole idea went horribly, horribly wrong.
IBM will sell you hardware, software, programming, and support services. What you do with it is your responsibility.
When a highway department wants to build a bridge, there are both stated and unstated requirements. The project manager and engineers start with the stated requirements and find and analyze all the unstated requirements. A highway department will have a general idea where the bridge should be built. In the analysis the bridge building firm may discover important reasons to build the bridge in a different location. The firm will look at traffic patterns and recommend and optimal design to meet the highway departments ultimate requirement -- to make long term improvements in transportation.
If IBM built that bridge, it would build it exactly where the highway department suggested and how it suggested. If the foundation was weak and the bridge started to tilt, it’s not IBM’s fault. You told it where to build the bridge. IBM did what you told it. It also never analyzed every aspect of your requirements. It did no testing. It did no prototyping. It just does what you tell it to.
It fulfilled customer requirements.
Fixated solely on its 2015 earnings target, IBM is making decisions based solely on its balance sheet. It is ignoring and damaging the overall operation of its business. It has the time and the money to save the company. Yet it is doing more and more things that are ultimately destructive to the very survival of IBM.
Reprinted with permission
Image Cedit: zetwe/Shutterstock