Challenges of Using Large System Integrators

I broke this down in the video above. Below is the written version, expanded into a fuller guide to the challenges of working with large system integrators and how to protect yourself.

Large system integrators can help transform a business, but they come with real pitfalls you have to plan for. If you are about to bring in a big firm to move off legacy systems, this one is for you. These companies help you modernize, but the engagement is a negotiation as much as a partnership, and going in unprepared is how organizations end up over budget and dependent. In the video I laid out the specific things to watch for, and here I want to expand on each, because I have seen these same patterns play out time and time again. Do your homework, and you can get the value without the heartache.

Get the contract ironclad

System integrators have many lawyers, so your statement of work must be reviewed by strong legal counsel.

Everything starts with the contract. These companies have a lot of lawyers, and they may push to get the deal signed quickly so you can start working together as partners. That urgency is exactly when you should slow down.

I stress this in the video. Make sure you have a strong legal entity review the statement of work in detail, because they have plenty of legal muscle on their side. What I learned is that if you do not get the contract right, you are setting yourself up for failure and a lot of heartache later, when the terms you skimmed become the terms you are stuck with.

Watch for the low bid and the change orders

An attractive initial quote often grows through change orders and out-of-scope claims, so get multiple bids.

The opening number can be misleading. These firms compete hard, so you might get a fairly low initial quote. Get two or three quotes so you have good information and can make a sound decision rather than reacting to a single pitch.

Then watch what happens after signing. Big integrators like Infosys, Accenture, or IBM will get a contract in place, and before long the amount starts climbing through change orders, with work suddenly declared out of scope. I found that the only defense is doing your homework up front and laying everything out clearly, so that everyone agrees on what is in scope before the invoices start.

Insist on their A players

Firms sell you with their best people, then swap in less experienced staff, so contract for top talent throughout.

Here is one of the most reliable patterns. Initially they bring in their A players, and those A players sell you on the service beautifully. But after the contract is signed, especially on a multi-year deal, you start hearing that someone is moving on and will be replaced by another person with supposedly equal experience.

I get into this in the video. What actually happens is the A players go sell the next contract, and you inherit the B and C players. Get a commitment in the contract that you receive top-rated people throughout the whole engagement, with the right to request a replacement or a penalty if you do not. What I learned is that this clause is one of the most valuable things you can negotiate.

Guard against subcontracting and contingency

Watch for hidden subcontractors and large contingency funds that quietly expand the engagement.

Two more traps deserve attention. Integrators often subcontract the work out to other firms, taking the higher dollar amount and replacing their people with subpar staff. Ask directly, and require in writing, that your work is not handed to subcontractors.

Contingency is the other one. They may ask for thirty or forty percent contingency so they do not have to keep requesting money, and then use that fund to supplement scope and pull in extra work. Before long you are back in front of your board or CIO asking for more funding. I found that keeping contingency small and change orders tightly controlled is what keeps an engagement from quietly doubling.

Do not let them get embedded

Integrators can become deeply embedded and hard to remove, so protect your independence from the start.

The final risk is the quietest. From the back side of all this, these firms get deep into your business, and it becomes very hard for them to get out. You grow reliant on them, and they will actively encourage you to keep using their people and services.

When things go wrong, they often find ways to blame your internal employees or claim your staff lacked the experience. What I learned is that you have to protect your independence deliberately: keep knowledge in-house, document decisions, and never let a vendor become the only group that understands your systems. Do your homework so that you stay covered.

The takeaway

Large system integrators can genuinely help you modernize, but only if you go in prepared. Get the contract reviewed by strong legal counsel, gather multiple bids and guard against change-order creep, and contract for their A players throughout the engagement. Watch for hidden subcontractors and oversized contingency funds, and above all, protect your independence so you never become trapped and reliant. Do the homework up front, and you get the transformation without the heartache.

If this helped, the full rundown is in my video on system integrators. Here is my question for the comments: what is the hardest lesson your organization learned working with an SI? Subscribe if you want more on the business side of technology delivery.