IoT
Strategic CIO // IT Strategy
Commentary
5/26/2006
04:29 PM
Tom Smith
Tom Smith
Commentary
50%
50%

Outsourcing Tracker: Unhappy Customer Sues IBM

I've predicted before that failed outsourcing contracts will become commonplace enough that we'll find more and more companies dumping their outsourcers. The last example, cited just nine days ago, was Diebold dumping Deloitte Consulting.

I've predicted before that failed outsourcing contracts will become commonplace enough that we'll find more and more companies dumping their outsourcers. The last example, cited just nine days ago, was Diebold dumping Deloitte Consulting.Now we have another, uglier example. IBM is being sued by Sprint Nextel, which is seeking $6 million in damages for failure to live up to expectations. Now $6 million may be a drop in the bucket for IBM, but this is part of a five-year, $400 million outsourcing pact that's anything but a drop in the bucket. The future of that deal could be tenuous if a key piece of it has wound up in litigation. Sprint Nextel has already reduced the amount of work allocated to IBM.

For its part, IBM is maintaining the ultimate stiff upper lip, as a spokesman was quoted as saying, "...IBM continues to have a significant and healthy relationship with Sprint."

Memo to IBM and Sprint Nextel: Lawsuits aren't a good indicator of significant, healthy relationships.

Comment  | 
Print  | 
More Insights
Comments
Threaded  |  Newest First  |  Oldest First
Register for InformationWeek Newsletters
White Papers
Current Issue
Top IT Trends to Watch in Financial Services
IT pros at banks, investment houses, insurance companies, and other financial services organizations are focused on a range of issues, from peer-to-peer lending to cybersecurity to performance, agility, and compliance. It all matters.
Video
Slideshows
Twitter Feed
InformationWeek Radio
Archived InformationWeek Radio
Join us for a roundup of the top stories on InformationWeek.com for the week of June 19, 2016. We'll be talking with the InformationWeek.com editors and correspondents who brought you the top stories of the week to get the "story behind the story."
Sponsored Live Streaming Video
Everything You've Been Told About Mobility Is Wrong
Attend this video symposium with Sean Wisdom, Global Director of Mobility Solutions, and learn about how you can harness powerful new products to mobilize your business potential.