Paula Musich, eWEEK
January 22, 2001 12:00 AM ET
cuts and money woes decimate boutique Web integrators, major services
companies are finding themselves increasingly pressed into action
to complete projects the small shops couldn't handle or couldn't
efforts of such enterprise integrators as IBM Global Services and
Electronic Data Systems Corp. are offering e-businesses left in
the lurch hope, stability and added services.
at IGS and EDS said their companies have accepted hundreds of engagements
in the past six months, coinciding with the downturn in fortunes
of such boutique Web integrators as Razorfish Inc., MarchFirst Inc.,
IXL Enterprises Inc., Scient Corp. and Viant Corp.
making the transition from one Web company to another-in many cases
in midproject-is no trivial matter. But they're doing so for a variety
of reasons, including smaller Web integrators' frequent inability
to deliver on their promises of a well-built, well-integrated product.
pulled into a significant number of situations where the client
ended the work because it wasn't up to their expectations," said
Pete Martinez, an e-business strategy executive for IBM, in Boca
the vast number of Web projects in the pipeline, no industry has
been immune. When a major U.S. bank first saw the code a boutique
delivered for a critical e-commerce initiative late last year, technologists
responsible for the project knew they were in trouble. Rather than
getting the flexible platform they wanted that would allow them
to adapt to changing business requirements, they received something
that would require constant support, according to bank officials.
terribly uncomfortable with what we found," said the bank's former
chief technology officer for the project, who asked not to be named.
After an intense negotiation in which the bank tried to get the
boutique to solve the problems, the CTO ultimately turned to MphasiS
Corp.-BFL to put the project back on track.
hardly a household name, MphasiS, of Bangalore, India, and Santa
Monica, Calif., does have something its smaller competitors envy:
deep back-end integration experience and a stable record of profits
not unheard of for another consulting company to be brought in to
clean up the mess left by an earlier company. But the volume of
companies that are engaging in this process is new. The gold rush
mentality surrounding many e-commerce projects led to unrealistic
expectations, according to Jeroen Tas, president of MphasiS.
everybody got carried away with the hype," Tas said. "They started
to believe you could build a complex system in six months. It takes
time and a lot of testing to build a robust system. In the rush
to market, people didn't do a thorough job."
lack of due diligence was often fueled by the boutiques themselves,
which overpromised, then fell short of meeting expectations when
the sliding market hit their staffs and their wallets beginning
early last year.
horses in midstream raises its own set of issues, and it raises
the question of how well-prepared larger players are to step in
quickly to salvage failing projects.
claim that they have a services offering, dubbed NetSource, that
can be tailored for such tasks.
important to listen to the client to understand what it's trying
to accomplish and then put a complete road map together for the
project, IBM's Martinez said.
was one of the faults of many of these companies running into problems.
They had one good idea and everything had to be structured to their
offering," he said.
sit with the business to understand their expectations," Tas said.
"You have to do the due diligence ... even if they don't want it."
the potential damage, clients can protect themselves by taking several
steps, said Brad Rucker, executive director of EDS Bluesphere, in
the vendor to milestone deliveries-ask for copies [of mock-ups,
design documents and so forth] for every step of the way," Rucker
personnel cuts late last year; stock buyback in progress
round of layoffs cut 1,000 earlier this month
$150 million cash infusion amounts to life support
off more than 400 last month; sales dropping near 40 percent
stock price off 97 percent since March, can the end be far
off 125 in December; losses seen continuing
may have enough cash to stave off Chapter 11