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March 27, 2008 7:30 AM PDT

Waste Management sues SAP over 'complete failure'

By Reuters

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Waste Management sues SAP over 'complete failure'

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Waste Management says it spent more than $100 million on a computer system that was supposed to help it save money, but instead turned out to be a "complete failure."

Waste Management spokeswoman Lynn Brown said Wednesday that her company is suing SAP, the German-based company that sold it the system, seeking all its expenses plus punitive damages.

The No. 1 U.S. trash hauler, which reported $309 million in fourth-quarter net income, has yet to determine whether it will take a charge for its investment in the failed system.

"It depends on what SAP's response is to the lawsuit," Brown said in an e-mail. "We need to assess their response."

SAP spokesman Andy Kendzie declined comment.

The software maker sold Waste Management computer programs that were supposed to be designed to manage tasks unique to U.S. companies that haul waste and handle recycling, with no customization required, the lawsuit said.

Those programs handle tasks including billing, waste logistics, container management, and on-board computing, according to a December 2005 press release from SAP America.

"Unknown to Waste Management, this 'United States' version of the Waste and Recycling Software was undeveloped, untested, and defective," the suit says.

Texas-based Waste Management filed its lawsuit on March 20 in the district court of Harris County, Texas.

Add a Comment (Log in or register) 11 comments

Waste Management
by als March 27, 2008 9:34 AM PDT: maybe Sap should change it's name to Waste Management.; Reply to this comment

Woohoo!
by three_toed_frog March 27, 2008 9:35 AM PDT: Man, I hope SAP gets sued into oblivion. We use it here where I work as well, and we constantly have issues with user profiles randomly disappearing, system failures, etc.

What a piece of crap. Good riddance.; Reply to this comment

If only the goveremnts did this too
by kieranmullen March 27, 2008 9:40 AM PDT: I am all for getting ride of frivolous lawsuits that waste taxpayer money, but I believe that local governments should bring various consultants and their companies to trial as well for billions in failed projects.

In Oregon we had the DMV try to install a new system a while back which never happened.

KieranMullen
http://360oregon.com; Reply to this comment View reply Hide reply
Processing

Plenty of blame to go around
by MadLyb March 27, 2008 10:38 AM PDT: So, we have a 1.2 billion company claiming to have spent 100 million on a SAP implementation?!

A typical ERP implementation for a company that size is more like 30-40 million.

No financial accountability upfront, no due diligence on the actual software?

I think Waste Management needs to take a look in the mirror.; Reply to this comment View reply Hide reply
Processing

Whats new?
by igl00lgi March 27, 2008 11:04 AM PDT: So, when that slick looking guy, or woman, in the sharp looking suit says the magic words, "Don't worry." Run, don't walk. RUN. These companies, uhumm, O, are more sales teams than substance. Have to admit they are good at what they do, selling, not implementing. I watched a company go under while trying to implement a system from another well known company. Simply sad. Alot of people lost jobs, while the sales team moved onto another victim.; Reply to this comment

Classic Example of Being Oversold
by d2louie March 27, 2008 3:11 PM PDT: Sales Reps get compensated on the deals that they close. Consultants have to go in and clean up the mess and do the work. Right now it looks like the consultants are incompetent in building something up to specs, but really the Sales Rep just over sold the customer.; Reply to this comment

Truly amazing
by fidlrjiffy March 28, 2008 7:07 AM PDT: Waste Mgmt should sue SAP if only to highlight the fact that ERP implementations in general and so many vertical applications in particular are too generic to suit any company's business out of the box. Having said that this is a case of buyer beware as well as, no doubt, throwing good money after bad. Waste Mgmt did not do their homework and more likely skipped class altogether. Who does not know that SAP, PeopleSoft, and their ilk require huge efforts to get to the point where you're simply tired of trying to get it to work? Who doesn't know that SAP's job is to get the contract and that there is no point in being completely honest because the customer will simply go to the vendor who tells them what they want to hear? On what planet is any system implemented "without customization" and still cost $100 million? Executives at Waste Mgmt and other large companies do not get their bonuses by going "Oops, this was a mistake". Who'll take the bet that the guy who signed the contract is still around? What's unusual is that Waste Mgmt is suing. Usually, companies skulk out with their tails between their legs and make the best of a bad deal. Chances of Waste Mgmt winning are slim; SAP is not dumb enough to not have sign-offs up the wazoo and the implementation undoubtedly works "as designed" if only Waste Mgmt adopts their processes to SAP. Broadly speaking no business app can hope to mimic 100% any business process done by people. The other way around, maybe.; Reply to this comment

Snake oil and koolaid
by gggg sssss April 15, 2008 5:26 PM PDT: SAP, more than other ERP vendors thinks that they know all there is to know about running any business or governemnt organization. Senior Management abdicate their resposibility for running their business by outsourcing their thinking to SAP. They deserve what they get. Remember, SAP is a bunch of maingframe IBM guys still looking for clues.

How hard can it be to keep track of a few trucks of garbage?; Reply to this comment

by erickimberling June 2, 2008 10:13 AM PDT: ERP isn't about the technology, it's about the business processes and people. Waste Management isn't the only company that forced a misfit technology into its operations and exposed itself to a huge amount of risk. Of course, a successful ERP project begins with an effective ERP software selection process, but it also requires companies to clearly define their business processes and roles during implementation. Click here to read a good article about how to fix a failed ERP implementation.

Eric Kimberling
Panorama Consulting Group; Reply to this comment

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