Saturday, November 23, 2013


As the drumbeat of criticism over the failed rollout of the Affordable Care Act (ACA) on-line system continues, it is important to look at a different perspective. Here are a few items to consider:

1997 - The City of Portland, Oregon Water Bureau entered a contract with an IT contractor to develop a new billing system. The cost would be $6 million, and it would be ready within a year. In 2000, the Bureau decided to go live with a flawed system, and there were billing problems with 40,000 customers. The final cost was more than $10 million, and the Bureau estimated that it lost $20 to 30 million of revenue as a result. In 2004 the Bureau scrapped the system and started over, issuing a new contract to an IT company to develop software.

2008 - A new City of Portland payroll and internal operations IT system was 10 months late and $19 million over budget. Once it was put into operation city employees experienced numerous problems with their pay and benefits. Not to worry, said the City, "there is a learning curve and anyone who has implemented a system this big knows it takes 18 months to stabilize, and we're only at six."

2013 - The Oregon Employment Department spent $6.9 million on a software project that never worked, and now has to spend another $1.2 million to patch up the old system. In addition, the State might have to pay back the federal government $1 million granted for the failed project.

2013 - The Oregon Health Exchange website is a failure, and the State of Oregon vows it will hold the contractor, Oracle, accountable for missed deadlines and shoddy work. The contract dates back to 2009, when the Oregon Health Authority entered into a time-and-materials contract with Oracle to modernize the Authority computer systems. Oracle was paid over $60 million on that contract, and was paid another $40 million for the Cover Oregon health exchange work. The contract includes a warranty that states Oracle "warrants that service will be provided in a professional manner consistent with industry standards," and "Oracle does not guarantee that the programs will perform error-free or uninterrupted or that Oracle will correct all program errors." Wow! No wonder the Oracle CEO, Larry Ellison, is the highest paid CEO in the USA at $96 million a year!

The examples above are a very, very tiny window into the world of computer software. Massive failures, and time and cost overruns are probably more the rule than the exception. We hear about these when the client is a public agency; we don't hear about them when the client is private industry.

So why is anyone surprised that the web site for the ACA was flawed at rollout? The failures of the website are very unfortunate, but the flaws are not fatal and will be fixed. Was this a problem with private contractors or the government itself? Very likely both. Does this mean that President Obama is a failure? Give me a break! Does this mean the ACA will be a failure? Absolutely not, in spite of the dreams and underhandedness of the Republican Party.

I think that IT, information technology itself, is the problem. Consultants always promise the world, and often have a hard time delivering it. I know this because I have been a consultant for 30 years, and many clients ask for the impossible. Unfortunately, many consultants say that they can do the impossible because they want the contract, and most actually believe in themselves enough to think that they can do very difficult things, bordering on impossible. I once was asked by a client in a contract interview if I honestly thought what the client wanted could be done for the budget they had. Because I'm honest, and because the client was a friend, I looked him in the eye and said that no, it could not be completed for that budget. He gave the contract to the consultant who said yes. I never checked to find out if it panned out.

We have come to rely on IT more than we should. I've heard people say, in regards to the flawed ACA website, "They should have hired private industry to do it, just look at Facebook and Google." Well, we don't hear about the failures at Facebook and Google, unless they roll out something new that is flawed and pisses off their users. Does anyone remember the Apple map app for the iPhone, or the recent iOS update for iPhone and iPad?  I'm certain that these IT giants have had, and will continue to have massive failures that never see the light of public, and they are wealthy enough to absorb the costs.

So people, chill out. The end of the world is not upon us, the ACA website will work sooner than later, and all will be well in the world; or at least, as well is it can be living within The Matrix.