We’re increasingly hearing from customers about a common scheme being perpetrated by some of the largest SI’s and IT service vendors on the planet. In the sketchy world of IT body shops, it is common practice to ask for 50% upfront and 50% upon completion of a project. From what I understand, this practice originated in the construction industry. Even in construction it doesn’t make a lot of sense, but it has absolutely no place in the delivery of business solutions. I call it out for exactly what it is, it is a scam. Maybe not a Bitcoin / crypto token level one, but still a scam and a widespread one at that. Why do I claim this? Well let’s dive in a bit to find out.
In our world, the scheme goes a little something like this. The customer has a SAS workload they need migrated to PySpark, and contacts an SI or vendor claiming to do SAS migrations. That vendor, knowing little about how to migrate SAS workloads claims to be experienced. Maybe they’ve migrated a bit of PROC SQL or some simple SAS code, but they really don’t know anything about how to migrate SAS at scale. The resources tasked with doing the work, typically will not have any experience with SAS code, and most aren’t even experienced data scientists or data engineers either. To ensure they get paid even if they fail, they set up a contract demanding 50% upfront and 50% upon completion.
Now the obvious flaw in all this, is that the vendor can make a significant amount of money, with or without delivering anything of value. So 0% risk for vendor, and 100% risk for the customer, pretty good deal right? The scam is almost always enabled by vendors with offshore sweatshops full of low hourly cost, low skilled labour. For the scam to work, the 50% upfront needs to easily cover labour costs until the customer either forks over more money via change requests (CRs), or just gives up altogether, so cheap labour is a must.
Despite all the red flags, like complex scoping, lengthy timelines, messy output, lack of knowledge of SAS and/or suitable target (i.e. PySpark), and sketchy contract terms, the customer still goes ahead. The price seems almost too good to be true (at least before CRs pile up). Many of these companies are global giants, so what could possibly go wrong?
Even at very limited scopes, something as small as just 25,000 lines of code, these vendors struggle to deliver. They struggle with consistency, they struggle with quality, they struggle with speed, and most critically they struggle with SAS specific functionality. I’ve been told that to keep up appearances, many vendors produce regular reports to their customers showing progress, but nothing else of any substance.
Many frustrated months later, after they still have nothing to show for that first 50%, customers come to us complaining of this scheme. Sunk costs are always hard to own, and these vendors bank on that. Even harder to admit, is that you fell for a scam, that in retrospect seemed so obvious. It’s a pervasive problem, and one that goes far wider than just SAS migrations. I myself am cognizant of several of these scams with cloud migrations. What we see through our little window, is really just the tip of the iceberg of the full problem across the entire IT services industry. It’s high time we get the impetus to stop these scams, by refusing these vendors 50% upfront terms.
Let me be very clear, we are not like them! We don’t charge upfront, that would be just plain wrong. If you know what you are doing, you should not need to charge any money upfront. My mechanic, my hair dresser, my dentist, even my favourite restaurant, none of them charge money upfront. We are so confident in the speed and quality of our SPROCKET solution, we only ask to be paid once the work is done and you are satisfied. That’s the WiseWithData way.
Find out more about why SPROCKET is different – email@example.com