Good news for...
...Mercedes dealers in London and Armonk
In a long-running spat, British insurer Co-Op Insurance is suing IBM for £155m over what it claims is Big Blue's "deliberate" failure to deliver a new IT platform for the British financial services provider. In legal arguments shown to London's High Court this week, CIS General Insurance Ltd (CISGIL) – the insurance arm of the …
IBM can keep this up for decades. They have a guaranteed money stream coming in from mainframe and quite honestly there are use cases that really still need mainframe-level processing. They also have enough multimillion dollar offshore outsourcing projects running, plus they now have Red Hat.
They've basically completed the transition to an Accenture or PWC or similar....just juggling massive outsourcing contracts and jumping from contract to contract without really producing a lot.
Is a marriage not made in Heaven. So, another wreck along the IT highway. What's betting that we'll have IBM on one side, with all the documentation needed to prove that they respected the specifications and were forced by the client to do a lot of additional work, and Co-Op on the other side with a hodepodge of contradicting emails and some meeting minutes where they will try to prove that IBM was playing fast and loose with the definitions of the specifications ?
Let the mudballs fly and we'll see where they land.
Was it not declared? The article says Co-Op claimed they were told the IG package was an "out-of-the-box solution". My impression is IBM told them pretty early on, possibly in the proposal, that they'd be using Insurer Suite. Since IBM does not have their own commercial package for this industry vertical, you'd think Co-Op would have wanted to know where the software was coming from at the start.
I'm not saying IBM didn't misrepresent Insurer Suite - they may well have; I don't know anything about the situation beyond what's in the article. But it doesn't sound to me like they represented it as something developed in-house.
.. can you sell something to someone (and lie about^w^w mis-state the functionality), do nothing for 18 months and then tell the customer that they have to pay you anyway?
If you tried that in any other industry that I can think of you would be out of business in a year.
TBH, a "no outsource" clause won't help. As someone who has worked in the industry and negotiated such contracts and delivered such projects, it's always possible to circumvent a "no outsource" clause by "insourcing" the subcontractor's product and people. Happens all the time in systems integration contracts where the end-to-end scope of work involves many suppliers and products and customer wants a single throat to choke. It's simply impossible for the Prime Contractor to do everything on its own without partnering with the other suppliers. At least in this case, the saving grace is, the customer has a single vendor - IBM - to sue.
Ah yes - you live in the US, so maybe suffer from Donald Chump syndrome. The article ends with
The trial will continue for the rest of this month. The Register will be covering key moments. The court will hear evidence from key people within the Co-Op, IBM and IG. ®
(apologies to you personally - if you're reading this, you're probably intelligent -but, you know, Donald says he's super intelligent - and he can't read to the end of a briefing)
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