PatakhaSoft and AtomBomb $$ killer combination $$BACKGROUND Medical Services Partners Inc. $($MSP$)$ was a $40-$year$-$old company providing health care benefits for large corporations. To keep health care costs down for its clients, MSP needed to get a large group of physicians and health care providers in the group who were willing to accept the cost reimbursement rates established by MSP$.$ MSP provided reimbursement rates that were in line with its competitors. Although MSP had some success in getting service providers into its network, several hospitals and physicians resisted joining the network because MSP had a reputation for reimbursing service providers slowly. To pay service providers more quickly, MSP had to modernize its operations and eliminate a lot of the paperwork that generated delays in payments. MSP upgraded its computers quickly. But the real problem was the software. No software was readily available in the marketplace to satisfy the needs of MSP$.$ MSP hired a software development company, PatakhaSoft, to assist its information technology $($IT$)$ personnel in the development of the package. PatakhaSoft was provided with offices for on$-$site personnel on the same floor as MSP$$s IT personnel. MSP had budgeted $$15$ million for the entire project, entitled QuickPay$1,$ and had promised all physicians and hospitals in its network that the system would be up and running in a year or less. FIRST QUARTERLY REVIEW MEETING In the first quarterly review meeting, which was attended only by MSP personnel, Jahangir Jani, the chief information officer, stated how furious he was: Why can$$t I get a straight answer from anyone on the status of the QuickPay Project? We$$re spending $$15$ million and nobody seems to know what$$s happening. Whenever I ask a question, it appears that all I get in response is bad news. Why aren$$t there any metrics for me to look at each week or each month? Since the project began about three months ago, I have seen requests for more than $200$ scope changes. Now I$$m told that we will probably be missing deadlines, and the schedule slippages cannot be corrected. We have escalating costs because of the scope creep, and it looks like we$$ll have some deterioration in value expected for our clients. Reema Khan, the project manager for MSP$,$ spoke up$.$ When we hired PatakhaSoft, we gave them a fixed$-$price contract. We had no idea how many scope changes they wanted, but we assumed that there would be a small number. We were a little na$$ve$.$ Last week, when we asked them for their position on the status of their work, they said that they could not provide us with detailed status information because they said that it depends on the number of scope changes that we approve. Their schedules keep changing. Jahangir Jani was furious. It appeared that the company would be spending significantly more than $$15$ million, and he could not get metrics, schedules, or effective status reporting. This project had the potential to be a colossal disaster. Jahangir Jani demanded that the company now have monthly rather than quarterly review meetings with him and possibly other senior management personnel. He was convinced that everyone understood what had to be done, but he was equally unsure as to whether they would do it$.$ REVIEW MEETING AT END OF MONTH $4$ Jahangir Jani was still quite unhappy after seeing the data in the review meeting. There were schedules and metrics. During the briefing, Jahangir Jani was told that work was progressing but not as fast as originally hoped for. However, the metrics provided no useful information, and the schedules had a series of footnotes at various locations stating dependencies on the approval of various scope changes. Once again, Harris found it difficult to determine the true status of the project. Reema Khan, the MSP project manager, spoke up again. We$$re making progress in status reporting but not as fast as I would have liked. Some of the team members from PatakhaSoft are reluctant to provide us with good metrics. They tell us that they simply do not believe in the use of metrics, probably because they are afraid of what the metrics might reveal. That$$s why they often select the easiest metrics to report or those that provide the least amount of information. I know that some of our own personnel are obsessed with metrics, but we simply cannot afford to create all the metrics that these people desire. I$$m not sure right now which way we should go or what would be a reasonable compromise. To make matters worse, we have lost some of our key personnel to other projects. CRITICAL DECISIONS There was now no question in Jahangir Jani$$s mind that things were not going as planned. The morale of the team was poor; key personnel had left the project,probably by choice; and status reporting was unacceptable. PatakhaSoft was probably taking advantage of MSP by pushing through questionable but profitable scope changes, and the end date $$would mos