See You in Court

Computerworld - The fact that we live in a litigious society is undeniable. But to what extent has lawsuit lunacy penetrated the world of IT? Are disaffected companies running to court over broken IT contracts as never before?
It all depends on how you read the numbers. "I sense that the IT world over the past decade has gone from becoming relatively less to relatively more litigious than the rest of the economy," says Tom DeMarco, a consultant at Cutter Consortium in Arlington, Mass. "Big systems integrators often have 50 concurrent lawsuits pending."
DeMarco, who is exposed to many IT-related lawsuits in his work as a litigation consultant, says the equivalent of 10% to 15% of many corporate IT budgets are consumed by legal costs. Court calendars are clogged with often baseless lawsuits brought by people who would rather fight than talk, he says.
Although precise numbers are hard to come by, there's evidence to suggest that the number of IT outsourcing lawsuits has increased significantly during the past few years. While many executives rail against filing suit at the drop of a hat, the situation is likely to get worse before it gets better.
Whether it's a matter of late delivery or unmet requirements, experts say that most problems arise from a failure to communicate.
CIOs can help their companies avert the pain of litigation by spelling out specifications and timetables upfront and by maintaining channels of communication with the vendor during implementation.
Bruce Webster, a consultant at PricewaterhouseCoopers in New York, recently completed a study of 25 years of litigation resulting from IT systems failures. His sampling of cases lends credence to the view that IT litigation has trended upward.
Of the 120 cases Webster studied, five were filed in 1974-76, 18 in 1988-90 and 23 in 1994-96. A decrease to 19 filings in 1997-99 "reflects a time lag in our ability to gather data on the most recent cases, rather than an actual downward trend in such legal actions," according to Webster's report.
But Webster is cautious about exaggerating the trend's significance. "My impression is that litigation is on the rise because the number of IT projects has been increasing steadily over the last 25 to 30 years," he says. "Before that, it was relatively rare to embark on a major project. Today, it is a fundamental necessity in both business and government."

			Avoiding Conflict Agree ahead of time to expectations, promises and contingencies. Include performance and compatibility requirements, anticipated life span and acceptable levels of defects in systems specifications, as well as required functionality. Clearly define key terms, conditions and activities. Review documents up and down the chain of command in both organizations to make sure all relevant personnel understand what's promised and what's expected. Implement small, comprehensible and workable systems at first before expanding into the desired large systems. Plan to migrate off IT technologies that your organization doesn't control in order to avoid unplanned obsolescence. Get expert legal and IT guidance before signing anything. Act quickly when problems arise. Work with the vendor to achieve the desired goal. Source: Bruce F. Webster, "Patterns in IT Litigation: Systems Failure (1976-2000)," PricewaterhouseCoopers, New York, 2001