Monday, April 20, 2015

Some Hard Lessons In IT Contracting

Recent news reports indicate that a major American school district may be considering bringing suit against certain of its hardware and software vendors.  The district reportedly feels that the product bundle they acquired from these vendors is unreliable, lacks educational content and is difficult for non-native English speaking students to use.  The names of the parties are irrelevant to this analysis, as it will not address the details of that dispute.  Rather, it will examine procedures and safe guards to avoid such situations.


In general, computer errors arise from faulty hardware, faulty software, or incompatibility between the hardware and software. Identifying such faults can be time consuming and expensive.  Perhaps the hardware is defective; perhaps the software contains an unacceptable number of flaws. Perhaps the hardware and software are sound, but the customer has attempted an incompatible combination (e.g. running Mac software on a PC). For the customer, minimum protections would include warranties of hardware and software for 90 to 120 days of productive use.  Glaring defects should manifest within that time, and can be addressed by the appropriate party.  In the case of a custom or bundled product, better protection would be contract with one provider and require them to subcontract the other.  The contract should also provide that, if anything goes wrong, corrections are the responsibility of the prime.  That will protect customer from being drawn into disputes over whether the hardware or the software is defective.  Better protection would provide customer an opportunity to test the product before productive use begins.  Thorough “acceptance testing” can prevent unpleasant surprises after the live launch.


A consumer who purchases an off the shelf program and discover it does not meet her needs generally has the option of returning or exchanging it.  “Returns” are not quite so simple in the commercial setting, where the contract may limit vendor’s obligations to fixing malfunctions, and specifically disclaim responsibility for “fitness for a particular purpose.”  Unless the purchase was made at the recommendation of vendor, customer may have to bear any losses from poor product selection.  Customer’s exposure increases in cases of custom product development.  In those circumstances, vendor bears the burden of meeting customer’s specifications.  If the specifications are flawed or incomplete, the vendor will have a good defense:  it built what the customer requested.  Customers cannot realistically ask for more, unless the vendor was also hired to also provide expert analysis of, and solutions for, the problem in question.

Sound protections for the customer would include detailed, measurable, specifications and, once again, an opportunity to test the product before accepting it.

Ease of Use

This analysis is quite similar to that used for Content:  Did customer shop for a product that met its needs?  Did vendor build to customer specifications, only to have customer discover that its specifications were inadequate?

Lessons Learned

This short study illustrates two keys of a successful IT contract.  Customer must know what she wants, in detail, and be able to set those requirements out in terms that are exact and subject to measurable standards.  Customer must also require adequate acceptance testing, to uncover any flaws in design or execution before the product is released for productive use.

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