CIO analysis: Marin County vs. Deloitte and SAP, part 2

Summary:This post is part two of a series examining implications of Marin County’s lawsuit, against Deloitte Consulting and SAP.

This post is part two of a series examining implications of Marin County’s lawsuit, against Deloitte Consulting and SAP, on the enterprise software ecosystem. Also read part one, which explains why this case is important.

Related: Marin County claims racketeering against Deloitte and SAP, part one

Marin County's lawsuit against Deloitte Consulting and SAP raises important issues relevant to enterprise software buyers working with virtually all software vendors and system integrators. This case illustrates how conflicting goals and agendas, coupled with misaligned incentives, can drive failure rather than success on business transformation projects.

Because these relationships are so fundamental to technology-related business transformation projects, the topic deserves careful study. For this reason, I use the IT Devil's Triangle concept to help explain interlocking, overlapping, and conflicting agendas among enterprise customers, software vendors, and system integrators.

Related: Exploring the Devil’s Triangle The IT failures blame game (part 1) The IT failures blame game (part 2) ‘Pain chains’ and the IT Devil’s Triangle

Business transformation projects are complex undertakings that involve multiple stakeholder groups and project participants. In theory, all these groups should work together toward a common goal, which is supporting the customer's business objectives. In practice, however, each group may possess divergent goals and mutually exclusive metrics for defining success, which leads to conflict.

Although Marin's lengthy lawsuit (PDF download) makes many points, it raises three key issues:

  • Marin claims it had little knowledge of ERP, and therefore relied completely on Deloitte to perform the implementation
  • Deloitte allegedly misrepresented its capabilities to complete the implementation work successfully
  • SAP was allegedly complicit because, the lawsuit claims, it knew Deloitte had a track record of failed public sector implementations

Because Marin's legal position is so extreme, it provides an excellent platform for defining reasonable expectations among members of the IT Devil's Triangle.

Enterprise buyer issues

With respect to buyers, the fundamental question is: "What is the customer's responsibility when working with external software vendors and system integrators?"

Marin's position seems to imply that all responsibility lies with these external vendors, because the county had "little or no prior knowledge of SAP software or experience with complex ERP implementations."

On the surface, this position perhaps seems reasonable; however, enterprise implementations always require shared involvement between a customer and its vendors. Therefore, such an extreme position bears little connection to the requirements of actual software deployments. The question is where to draw the line on responsibility.

Part three, which is coming soon, suggests reasonable boundaries of responsibility among major participants in enterprise business transformation projects. Legal issues aside, these are matters of practical concern for which there are no easy answers.

CIO perspective. Scope and boundary issues related to responsibility are difficult to define precisely. Often, resolution across the gray areas depends on context and good will among the parties. Wise CIOs will formulate a reasonable view on these relationships, recognizing that give and take is critical to success. As this lawsuit demonstrates, rigid adherence to self-interested positions yields nothing but trouble for everyone concerned.

Topics: CXO, IT Employment, SAP, Software

About

Michael Krigsman is recognized internationally as an analyst, strategy advisor, enterprise advocate, and blogger. For CIOs and IT leadership, he addresses issues such as innovation, business transformation, project-related business objectives and strategy, and vendor planning. For enterprise software vendors and venture-funded star... Full Bio

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