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Comment by bhouston | Hacker News Reader

Like all IBM projects now day the bulk of the work was done in India for likely less than $5 CAD/hr, while they billed out $100 CAD/hr or even more.

The actual numbers may be slightly different, but still these are close to reality.

What a great profit margin for a failed project.

I wouldn't be surprised the code is like a lot I've seen from Indian-based sweat shops (btw there are amazing Indian coders, but you generally won't find many of them in these software houses producing the run of the mill code) - cut and paste code that hard codes every option and combination. And who cares because IBM makes money every time someone asks for a change.

IBM is the winner here, and everyone else is a loser.

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Not defending IBM, but IBM's job was to install "off the shelf software called PeopleSoft" to create a payroll system. They 'installed' it and walked away as that was what was required of them. They are now being called in to do more and that has contracting costs associated with it. The Govt of Canada has as much blame in this as anything - poorly written contracts with little knowledge of how software works.

Knowing how to buy and implement software is the responsibility, and therefore fault of both parties.

The service provider sounds like they either have not done this before, or are willing to make money off endless change requests.

The buyer's side in the government also likely has culpability in someone buying software who doesn't know how it's implemented.

I am not sure IBM should do something they were not asked to do. Not what they quoted for, IMO.

Consultant <> Contractors <> Freelancers..

Consultants are there to provide advice, guidance, strategy, and oversee/implement.

Contractors are there to be implement something that's already laid out for them.

Freelancers have a tiny portion of the work to do with little to no say.

Often, freelancers are upset that their customers don't want them to be a consultant and care about their opinions.

There appear to be 2 key failures of the vendor:

1) There's a big difference between being a consultant, contractor, or a freelancer. IBM is there to provide expertise to have a successful project.

2) Disfunction and inefficiency is profitable. It's good such behaviour is coming to light, because future up and companies will eat IBM's lunch in time.

A responsible contractor should ask the right questions to make sure the customer is not asking the impossible and are not going to be stuck with a useless solution at the end, they should not just milk the fuck out of them and cover their arses with layers of get out clauses.

Likewise the customer should not be such a dumb-shit as to agree to/write a contract which produces a system they cannot use and not take proper independent advice.

I have no sympathy for either party.

>Like all IBM projects now day the bulk of the work was done in India for likely less than $5 CAD/hr,

This was a PeopleSoft install with customization and IBM typically doesn't use India workers for those types of projects. I don't know of this Canada project in particular but I have knowledge of half a dozen other IBM PeopleSoft contracts with the government and they use onsite developers for it. One of the big reasons is the consultants must pass a federal background check which requires USA citizenship. I would assume Canada has a similar requirement.

Also, IBM doesn't have a PeopleSoft delivery/solution center in India to do this work. Last I checked, IBM does have a SAP delivery team in India.

This is not installing Peoplesoft with customization. "Off the shelf" implies a simple install would do. Obviously it seems using a default Peoplesoft workflow is not enough.

I'm trying to think of anybody who has used the default workflow for Peoplesoft or SAP. It seems like every project to implement them has some form of customization.

There is no such thing as a "simple" install of PeopleSoft that is immediately usable. It's "consultingware." It requires configuration and customization before it can do anything useful at all.

Consultingware is a variant of shrinkwrap which requires so much customization and installation that you need an army of consultants to install it, at outrageous cost. CRM and CMS packages often fall in this category. One gets the feeling that they don’t actually do anything, they are just an excuse to get an army of consultants in the door billing at $300/hour. Although consultingware is disguised as shrinkwrap, the high cost of an implementation means this is really more like internal software.

https://www.joelonsoftware.com/2002/05/06/five-worlds/

To reply to your's and the sibling comment. I understand that Peoplesoft cannot work by doing a simple install and use. I have worked with Peoplesoft for a bit too. I was merely pointing out that article says it was proposed as an "off the shelf" installation. With that information I am not sure if we can draw a conclusion whether the customization was asked or proposed in the first draft.

If we were to look at the problem from the angle of "proposed as an off the shelf installation" it becomes apparently clear as to why this whole thing had a problem. IBM was asked to install and go which they might have but without any customisation on it, the whole thing fell apart.

It will be interesting to know how was the "off shelf installation" proposal made. Was it IBM's consultant who made that error or some contractor before IBM?

I had a small company that did software consulting work for one of the provinces. Around 10+ years ago governments started requesting "off the shelf" solutions instead of custom-developed software. This led to a situation where they didn't own the code, were tied to vendor upgrade schedules, and had to pay a premium for customizations. This had the result of spiralling costs.

Each time there's a scandal, they tighten the rules so that ultimately only large companies with teams dedicated to writing proposals can compete.

To be fair:

- we worked on smaller projects of a scope where one person could maintain a mental model of the system

- nothing so mission critical as payroll

I expect the pendulum to swing back toward more internal development and greater ownership and autonomy. So far, not much has changed.

Last time I contracted for IBM I was paid 150/h and I heard they billed 300$/h on their end to the federal government.

> btw there are amazing Indian coders, but you generally won't find many of them in these software houses producing the run of the mill code

My favorite story is when, at a company I worked, the maintenance of a security product with the potential to brick a machine was handed over to such a sweat-shop. My then manager, who was behind the outsourcing, called it a success when they had successfully installed the product and bricked their dev machines. "They have already installed it on their machines! (and now they are trying to circumvent it)".

Even $100 CAD/hr sounds way too low.

So does $5 CAD/hr. Salaries in India have grown a fair bit since the early oughts.

Glassdoor for Indian IBM software developer:

https://www.glassdoor.ca/Salary/IBM-Software-Engineer-India-...

739,759 INR = $14K CAD/year = $6.7 CAD / hr.

Pretty close for a rough guess I would argue. But I was a little low.

Why doesn't Canada put a rule saying all work must be done by Canadians. Even if its cheaper keeping the money in country seems better than sending it to India.

people want to pay less taxes.

> Why doesn't Canada put a rule saying all work must be done by Canadians.

Because the government doesn't want to be seen as xenophobic. One of the major talking points of the prime minister and his government is "diversity is our strength". They also may want (depending on the department) to be seen as distancing themselves from expenses, not necessarily engaging in cost savings per se, but in cost-saving-style behaviour.

> Even if its cheaper keeping the money in country seems better than sending it to India.

Having worked with IBM-sourced contractors working in the U.S. and Canada, I can say that at least the ones I worked with were pretty useless regardless of where they come from.

The problem is that the government is bidding by familiarity rather than competence, and isn't willing to hire anyone competent enough to build a genuine team. When they tried their Shared Services Canada thing, it was a disaster.

The problem with government in Canada is apathy. Nobody, and I mean nobody, cares at all about Canada as an ideal or concept; nobody really cares all that much about their fellow Canadians.

> The problem with government in Canada is apathy. Nobody, and I mean nobody, cares at all about Canada as an ideal or concept; nobody really cares all that much about their fellow Canadians.

It feels the same in Germany, if i had to guess i'd say most western countries are going through something like this at the moment.

> It feels the same in Germany, if i had to guess i'd say most western countries are going through something like this at the moment.

Yeah, that's what I think I'm seeing too. When I talk with my fellow Canadians, especially those who grew up here, they say things like "we don't have a culture"; I get a similar vibe from visiting Germans, and even (to a lesser extent) some less-patriotic Americans.

It's like the west simultaneously forgot that their greatest cultural artifact is their societies. Western society is very, very different from how people lived before, and I'd say for the better, but there seems to be a taboo on taking pride in it.

I tend to get along well with the parents of second gen. Canadians. The parents seem to know why they came here more than native-born Canadians know they want to stay.

Government isn't being xenophobic. I mean there are Canadians from every country. But hiring someone in Canada keeps the money within the Canadian economy which I think is what governments should be doing. If they find some Indian guy who wants to come to Canada bring him to Canada let him do the job there let him become part of community. However if that money goes to some Indian guy in India how is it benefiting Canada?

> Because the government doesn't want to be seen as xenophobic. One of the major talking points of the prime minister and his government is "diversity is our strength".

That explains the current administration, but what about the 10 years before that?

Because in principle free trade is better.

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