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Litigating the runaway software project case: an incompetent contractor can drag out a software-upgrade project indefinitely and turn it into a bottomless money pit. The business client deserves a remedy.

Article Excerpt
Software project professionals often use gallows humor to describe themselves or their work. "Software project managers believe that Murphy was an optimist," they say. Or, "To err is human. Colossal screw-ups require a computer."

Pretty funny, right? Not if you're a business owner who has contracted for a new computer software system that has blown the budget and still isn't completed. In such cases, the exasperated customer usually cancels the runaway project just to "stop the bleeding." Software projects often go over schedule and budget, sometimes by several hundred percent. Resulting damages can easily run into the millions of dollars.

Small companies typically use off-the-shelf software to handle separate business functions. But as a company grows and becomes more complex, its officers or managers often want to integrate, control, and track all business functions from purchasing raw material to shipping the finished product--using one software system.

This is typically accomplished by selecting a core product, adding some specialized programs, and creating enough custom software to make the parts operate together. When a core product cannot be found, it can be custom-designed.

As a general rule, the more customized the software, the greater the risk that creating the new system will be problematic. If a system has been successfully created by the same vendor or consultant for similar businesses 100 times before, the chances are low that the project will spin out of control in both time and expense. As the amount of customization or the size of the system increases, the risk escalates.

Software system construction is unique because software is intangible; no one involved in building the system can "see" it. For example, if the first story of a proposed office building is too small to support larger upper stories, the flaw is obvious and can be addressed quickly. But if the design of a software system will not carry a business's eventual data loads, the flaw is not necessarily evident and may not be fixed until it is too late.

With large, complex systems, armies of designers, programmers, and testers try to build an invisible system that must ultimately function as a unified whole. Any deviation from rules and procedures for good software selection, design, configuration, and testing can harm the project substantially.

Mistakes made early in the project tend to do more damage than those made later. Projects that move rapidly (and cheaply) through early phases may be most at risk. What appears to be early success may actually be a sign of poor project management.

Certain steps--or disciplines--in software system creation are designed to prevent errors, inconsistencies, and the need for later changes. These include a thorough initial analysis of the client's needs, rigorous business flow and software design, effective training, strict standards, enforced methodology, and multiple levels of testing. When any of these are neglected to focus on system "production," the resulting software may be riddled with design and coding errors.

Trying to implement these disciplines later in the project can actually create more errors and inconsistencies, and the project may deteriorate into chaos as the "to do" list grows along with the budget and project staff. The project enters a spiral of endless complications and goes out of control. (1)

Sometimes a vendor or consultant tries to force a company to accept poor-quality software before errors and design flaws are eliminated. The company might agree to this, not understanding that the system's inadequacies pose risks to its business.

For example, the company may find that data entered into the system cannot be retrieved, that data is...

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