My IT implementation is going off the rails, what can I do? (part 2)
The project is running late. Deadlines are being pushed back “just a little.” Extra work is being tolerated. No one is consulting the contract anymore, because we want to keep the atmosphere positive. Sound familiar? This is called “project muddling through.” It may seem friendly, but it is the biggest risk to your business. And frustration has often already reached a high point before our IT lawyers are called in. That is why we are publishing this second part of our two-part series on concerns surrounding IT implementations today.
Read part 1: What should I do to ensure that my IT implementation does not go off track? (part 1)
The core
Waiting for things to work themselves out is not a strategy. If a project gets stuck, timely legal and administrative intervention is necessary. Not to take immediate legal action, but to get the supplier back on track via the contract. Those who only intervene when the damage is already incalculable have fewer options and a more difficult position when it comes to providing evidence.
The danger of ‘muddling through’
Muddling through occurs when everyone can see that a milestone will not be reached, but they continue to work without making any formal decisions. The result:
- Milestones and test moments shift unnoticed.
- The budget runs out, but the system is not finished.
- The old system has to remain in place out of necessity (double costs).
Without clear agreements on suspension, you often happily continue to pay for consultants and licenses, while the results fail to materialize.
Use the contract as a dashboard
The contract is not a document to be filed away in a drawer. As soon as the implementation runs into difficulties, you should use it as a steering tool:
1. Record deviations
Are there deviations from the scope or planning? Confirm this in writing. “We have agreed that X will now come later” is worth its weight in gold legally if a discussion arises later.
2. Make use of governance
Discuss structural problems in the steering group. Let the minutes reflect the concerns.
3. Dare to escalate
Is “asking nicely” no longer working? Take formal steps. A notice of default sounds harsh, but is often necessary to remove the non-committal nature of the situation. Do this proportionately and with an eye for the relationship, but be clear.
4. Be careful with Agile and ‘Best Value’
With Agile projects or Best Value Procurement (BVP), there is a significant pitfall of becoming passive (“The supplier is the expert, they’ll sort it out”). Keep steering. As a client, you have a duty to warn if you see things going wrong. You may be blamed later for sitting still.
When should you really pull the emergency brake?
Common pain points that require action are:
- Integration problems that are dismissed.
- Structurally insufficient expert consultants.
- Discussion about what constitutes ‘additional work’ and what was included in the price.
Frequently asked questions
What is the biggest legal risk of “muddling through”?
That deviations are not recorded. This makes it unclear who is responsible for what. If the project ultimately fails, you will lack the evidence to recover damages.
How do I avoid disputes about additional work?
By referring back to the scope and the change request procedure. If there is no signed change request, the starting point is often: no payment.
What should I do if the supplier does not deploy sufficiently skilled personnel?
Document the shortcomings and errors. Discuss this formally in the governance. If there is no improvement, give the supplier notice of default and demand replacement in accordance with the quality requirements in the contract.
Can I suspend payments if the project is not running smoothly?
Often, yes, and this is a powerful tool. However, there must be a shortcoming that justifies the suspension. Always do this in consultation with a lawyer to avoid breaching the contract yourself.
Is litigation over a failed implementation likely to be successful?
That depends on the case. Legal proceedings are costly and time-consuming. In practice, timely adjustments and case preparation (prevention) almost always yield better results than a lawsuit after the fact.
What is an exit arrangement and why is it important now?
If you have to stop, you want to be able to continue with another party. An exit arrangement forces the old supplier to cooperate with the transfer so that your business operations do not come to a standstill.
Advice
Do you have any questions about this article? Our ICT lawyers are ready to advise you! Contact one of us by email, phone, or fill in the contact form for a no-obligation initial consultation.
