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9 Games ERP Consultants Play

January 14th, 2013 by

ERP Consultant Games

Most in the ERP industry agree that software consultants can play a major role in helping their clients successfully implement a new ERP package. While some consulting firms have more expertise than others do, at least most firms try to operate with their client’s best interest in mind.

However, there are many firms within the ERP industry that are outright thieves. They will not hesitate to take advantage of their clients in order to pad their own wallets. In fact, some firms are so good at this it has become part of their standard operating procedures.

Clients that are educated and aware of the games consulting firms play can save themselves a few headaches and a lot of money. Below are some of their tricks to watch out for.

1)      The “Bait and Switch” Routine

During the sales process, this is when certain consultants are brought in to display the expertise within the firm. They may know best practices and the software, but it might be the last time you ever see them.

2)      Resumes: Lies and Half-Truths  

Outright falsification of consultant resumes is more common than you think. In addition, many resumes presented by the firm are not really resumes, but vague “profiles” that lack detail and read like sales literature.

3)      “Lowballing” the Quote

This is the oldest trick in the book, yet surprisingly many clients continue to fall into this trap. For example, all consultants know that for time and material quotes the actual implementation costs are usually much higher.  Also, most fixed price quotes are only fixed until further notice.  When the client wants to make only minor changes in the project scope, they are hit with expensive change orders. The change order costs are usually 100% greater than the actual time for the consultants to perform the work.

4)      The “Best” Implementation Tools & Methods

Most firms claim to have the very best implementation methods and tools available. However, do not be surprised when their consultants run off and do something entirely different during the project. Maybe the tools are not so great; otherwise, their consultants would use them!

5)      The Less You Know – The More Money They Make

For some firms, a potential client that has ill-conceived project objectives, an undefined scope, or lacks basic knowledge of ERP; is considered a gold mine. The idea is to gloss over these “minor” details until after the client signs the contract.

6)      Marquee Accounts for Reference Checks

When a potential client asks for a list of the firm’s other clients for a reference check, many firms provide only their “marquee accounts”. These accounts are compensated by the firm in some form for being a reference. Therefore, do not expect these clients to mention anything bad about the firm.

7)      Not Enough Time and Talent

Most consulting firms would love to “camp out” on your ERP project. One way to do this is convince the client that the organization lacks the right employees for the project. Also, some firms too easily support the premise that the client’s best employees have other tasks to perform that are more important than an ERP project. That is, “No need to get your hands dirty. Our consultants will do the project for you.”  

8)      “Add-on” Services 

Once consultants get their foot in the door, many try to sell their clients additional services. These include more consultants for readiness assessments, change management programs, best practices, and other services you may not truly need. Also, do not be surprised when your consultants push for software functionality that was originally out-of-scope. 

9)      The Promise of Software Knowledge Transfer

Most firms state that one of their goals is to “work themselves off the project” by transferring software knowledge to the client. However, nine times out of ten, if it is going to happen, the client must force the issue. Considering their hourly rates, what incentives do consultants have to transfer software knowledge?

This guest post is by Steven Phillips, author of the Street Smart ERP blog and the new book Control Your ERP Destiny.




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Investigative Report: Enterprise Application Guest Worker Fraud in America

June 18th, 2012 by
H1-B Visa Fraud

Guest Worker Fraud

Last week’s post on why Guest Worker IT Firms Crash Then Burn When Investigating Visa Fraud provided a little background on guest worker fraud being investigated now. Much of the spark to light this match was the whistle-blowing activity of a Jack Palmer about Infosys. However Infosys should NOT be considered an isolated incident.

As Jack Palmer’s case demonstrates there are options for consultants who are tired of the fraud. What Mr. Palmer’s conviction and dedication indicates is that you must be willing to stand up and be counted. No one said being a whistle-blower would be easy, but there are protections. Another interesting feature of Mr. Palmer’s case involves the various government agencies and channels conducting several of the ongoing investigations.

United States Senator Chuck Grassley from Iowa has taken a strong interest in meaningful visa reform and ending the fraud for some time. As a regular crusader against H1-B visa fraud he has often introduced legislation and taken a stand against fraudulent practices. As one example in a February 10, 2012 Grassley Weekly Video Address: H-1B Reform was the topic.

While some Guest Worker IT Firms Crash Then Burn When Investigating Visa Fraud there are still too many customers who are ripped off while their SAP or other enterprise projects crash and burn. Even though there are Hidden SAP Offshore Development Costs, those costs and the negative consequences go much higher when dealing with fake experience from onshore resources. There is a measure of customer trust that workers who are on site, employed by system integrators, had to go through some type of screening and background verifications for experience. Enterprise application customers almost expect that the hiring practices at some of these IT firms mirror their own internal processes. NOTHING could be further from the truth. See this excerpt from Mr. Palmer’s insight (noted last week in Guest Worker IT Firms Crash Then Burn When Investigating Visa Fraud):

When asked if all the people had some special expertise that couldn’t be found in the U.S., Palmer said, “Absolutely not. Not even close. Many of them [are] what we call freshers. People that would just come over, whoever they could get to come over. Whoever got accepted for a visa.”

Many of the people brought in, in fact, didn’t know what they were doing at all, Palmer said. “There was not a project or program that I was involved in that we did not remove somebody because they had no knowledge of what they were doing,” he said.

As noted by Mr. Palmer’s attorney Ken Mendelsohn, “Senator Grassley has taken an interest in this situation and actually wrote Secretary of State Hillary Clinton and Homeland Security Secretary Janet Napoliatano.” The letter and responses are attached here and are interesting from the perspective that there are still MASSIVE numbers of B-1 and other visas being issued (primarily to Indian IT firms).

Letter from Grassley

Response from Secretary of State Hillary Clinton

Conclusion on Helping to Clean Up VISA FRAUD in the Enterprise Application Space

Sadly for those with real experience, whether foreign born or citizen, it is not just the system integrators who are the problem–, often some of the recruiting firms help to continue perpetuating the visa fraud. I’ve heard of many cases where unscrupulous recruiters will provide candidates with resumes the recruiters rewrote to add “experience” and background “employment” that the individual does not have.

Mr. Palmer’s case together with several criminal investigations are underway (with still more to come) but you can do your part to stop the fraud in the visa program by reporting any incidents you encounter.

If the fraud were stopped I personally wouldn’t care if the caps on visas related to high tech were significantly increased or eliminated. Unfortunately I don’t think a real cleanup will happen until some people end up in jail.

As I have long said, I personally have no issue competing with the very best there is anywhere in the world but it gets old cleaning up and working around so many messes left behind in the SAP world. I’m not interested in that kind of “job security.” I want to make the highest and best use of my skills by helping businesses gain real benefit from their SAP projects.

—————————

References and Additional Information on Reporting Suspected Visa Fraud and Abuse

United States Code (USC): 18 USC § 1546 (a) “[Any visa, permit, or other document] procured by means of any false claim or statement, or to have been otherwise procured by fraud or unlawfully obtained…” provides for criminal penalties and fines.

Contact U.S. Senator Chuck Grassley to tell your story or to encourage further investigations or prosecutions: http://www.grassley.senate.gov/contact.cfm

The Criminal investigations into Infosys and other high tech worker visa fraud issues is being partially handled by the U.S. Attorney’s Office in the Eastern District of Texas. If you have information about Infosys or other system integrators committing visa fraud reach out to them. You can contact them here: http://www.justice.gov/usao/txe/contact.html

U.S. Immigration and Customs Enforcement accepts tips and information related to visa fraud, feel free to report any suspected incidents here: http://www.ice.gov/exec/forms/hsi-tips/tips.asp

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Guest Worker IT Firms Crash Then Burn When Investigating Visa Fraud

June 11th, 2012 by
SAP Consulting Fraud

Guest Worker Consulting Fraud

Recently a gentleman by the name of Jack Palmer blew the lid on the entire Guest Worker scam at InfoSys.  Anyone who has worked hard to establish their career in SAP (or other IT areas) the old fashioned way, through hard work and perseverance, owes this man a huge debt of gratitude.  He literally exposed the entire fraud and scam of the whole guest worker program by showing how one of the biggest guest worker companies routinely commits fraud.  Mr. Palmer’s case tells the story of how the guest worker program is abused and misused and even defrauds U.S. taxpayers.  His complaint even alleges how they believe Americans are stupid for allowing them to get away with it. 

In a statement to the Senate Judiciary Subcommittee on Immigration, Refugees and Border Security on Tuesday, Jay Palmer, the whistleblower at Infosys, said the company “intentionally violated our visa and tax laws for the purpose of increasing revenues.” Mr. Palmer accused Infosys of frequently violating U.S. visa laws and of staffing multiple client projects with illegal employees, including at Goldman Sachs, American Express, Wal-Mart and Johnson Control, among others [FN6].

It is worthwhile to note for the SAP crowd that several of those big name customers are SAP shops as well.

Mr. Palmer’s willingness to stand up to the guest worker fraud has caused the Department of Justice and the U.S. Attorney’s office to look into the practices of several  Indian guest worker firms who have “unusual” practices related to U.S. IT projects.

In my opinion this has been a very, very long time in coming and maybe only serious prison time will discourage some of the routine abuses of the system.  Please bear in mind that unlike some of my counterparts I could care less about the number of guest workers as long as the FRAUD is stopped.  I don’t mind competing with the very best in the world but I am tired of cleaning up messes from fakes, “freshers” and wannabees.  Enterprise projects are hard enough already and in my opinion it is because of the massive and widespread resume fraud and consulting fraud.  As a result few companies realize the benefits of properly implemented enterprise applications.

Judicial Summary of Palmer v. InfoSys Guest Worker Fraud Case

“This case stems from allegations of visa fraud and retaliation.  Palmer alleges that, while employed as an Infosys consultant, he uncovered evidence of fraud in the procurement of H-1B visas for specialty workers” [FN1].

Palmer says he began digging into how and why Infosys seemed to be bringing in large numbers of workers from its corporate headquarters in Bangalore, India, into the U.S.

Palmer says at first, most came over on H-1B visas. These visas are for people with specialized talents or a level of technical ability that can’t be found among American workers.

When asked if all the people had some special expertise that couldn’t be found in the U.S., Palmer said, “Absolutely not. Not even close. Many of them [are] what we call freshers. People that would just come over, whoever they could get to come over. Whoever got accepted for a visa.”

Many of the people brought in, in fact, didn’t know what they were doing at all, Palmer said. “There was not a project or program that I was involved in that we did not remove somebody because they had no knowledge of what they were doing,” he said.

When the U.S. State Department began to limit the number of H-1B visas, Palmer says Infosys began using another type of visa, the B-1. The B-1 is meant for employees who are traveling to consult with associates, attend training or a convention. But Palmer says the employees were brought in not for meetings, but for full time jobs.

Palmer said the jobs were in “Everything from coding software to testing software to fixing software to installing.”

Palmer said, “They could outbid everybody or underbid everybody on every contract (because they were paying less.) For example…if I’m gonna pay you $15,000 a year why would I pay an American or a legal worker $65,000 a year? It makes no – it’s just economics.”

And Palmer says the B-1 workers never paid U.S. taxes because they received their salaries from India.

“They’re basically a lot of times being paid on a cash card or a debit card where money was put in their account,” Palmer said. “And the fact is, is they’re just taking that money out and they’re never paying U.S. taxes.”

[O]ne of Palmer’s most serious allegations is that top company executives not only knew of the alleged fraud, but wanted to expand on it to increase profits. Palmer says during a 2010 meeting at Infosys’ corporate headquarters in Bangalore the practice was discussed with a group of executives, including a senior vice president.

Palmer told CBS News, “There [were] some conversations about how to increase the share price, which is – in America is the stock price. So it’s really about getting people over no matter what the cost or whatever. And you know, I think that’s the first time I heard the term, you know, ‘Americans are stupid.'”

According to Palmer, telling documents come from an internal Infosys website. One document appears to be a “do’s and don’ts” list that gives instructions on how to get B-1 visa requests by the U.S. State Department, telling managers not to mention things like work or employment on their applications or in interviews with U.S. Customs and Border Patrol agents.

When asked when he saw the information on the internal website what struck him, Palmer said, “Intent. Deliberate. Not even trying to follow the spirit of the law.”

When asked if the internal document on the website was an instruction guide on how to beat the system, Palmer replied, “Yes, in my opinion, absolutely.”  [FN2]

Legal Grounds for Palmer’s Civil Lawsuit Against InfoSys

Jack Palmer’s CIVIL legal claims and grounds for a lawsuit against InfoSys consist of the following [FN1]:

  • intentional infliction of emotional distress
  • negligent hiring, training, monitoring and supervising
  • legal misrepresentation
  • breach of contract

Americans and conscientious foreign workers can likely follow Mr. Palmer’s example and help to stop the blatant fraud in the system. 

There are likely additional grounds to sue as well.  There are also potential civil or criminal legal theories for unfair and deceptive trade practices, RICO (Racketeering and Corrupt Organization), Mail Fraud, etc.

There may be Corporate and Personal Liability for Fake Consultants, even by those companies who hire outside system integrators if an employee indicates unqualified, fake, or fraudulent consultants are being used by the system vendor.  The key is in raising the concerns about the frauds within the organization. 

Ongoing Criminal Investigations for Guest Worker IT Firms

As I mentioned, InfoSys is NOT alone in this.  InfoSys is just the tip of the iceberg as there is still a massive amount of Visa Fraud still going on today.  How many more courageous Americans will stand up and be counted to end the widespread, ridiculous FRAUD in the IT space?

While there are a few media reports, few if any of them clearly reference that there are CRIMINAL investigations going on as well as Palmer’s civil suit for damages.  While the extensive excerpts from CBS News deal with InfoSys there are several other guest worker programs that are under CRMINAL investigation as well by the U.S. Attorney’s office in the Eastern District of Texas. 

  • Vision Systems Group Inc. (IT Guest Worker Visa Fraud) [FN3]

The companies that are the subject of this investigation have asserted that the foreign workers have been brought to the U.S. to fill existing vacancies. However, the companies allegedly have not always had jobs available for these workers, thereby placing them in non-pay status after they arrive in the United States. In some cases, the foreign workers have allegedly been placed in jobs and locations not previously certified by the Department of Labor, displacing qualified American workers and violating prevailing wage laws.

The companies and foreign workers have allegedly submitted false statements and documents in support of their visa petitions. The false statements and documents were mailed or wired to state and federal agencies in support of the visa applications. The companies are suspected of visa fraud, mail fraud, wire fraud, money laundering and conspiracy.

  • Mumbai-based Larsen & Toubro (IT Guest Worker Visa Fraud) [FN4]

[The Complainant] Pai’s job in human resources at Larsen & Toubro in New Jersey adds a new dimension to this case.

In her role as human resources manager, Pai was required to help process visa-related documents. She alleges that immigration fraud “appeared to be rampant” at the company, according to the lawsuit.

This lawsuit is similar to one filed against another major Indian firm, Infosys.

While I don’t think I could be accused of being pro-union I can certainly agree with much of what the report from the AFL-CIO has uncovered related to guest worker fraud.  They have done extensive research in their 60+ page report entitled “Gaming the System 2012” [FN5].

 —————————-

[FN1] These are quotes or excerpts from the Judge’s Order in Palmer v. InfoSys order denying arbitration, Docket #10, November 9, 2011 pages 1 – 2. http://www.r3now.com/1/Palmer-Infosys-10.pdf

[FN2] CBS News – Whistleblower calls out IT giant over U.S. jobs, April 12,2012.  http://www.cbsnews.com/8301-505263_162-57412896/whistleblower-calls-out-it-giant-over-u.s-jobs/ (retrieved June 10, 2012)

[FN3] http://www.desicrunch.com/Wiki/Default.aspx?page=Abuse%20and%20Fraud,%20H-1B%20and%20L-1,%20for%20article (retrieved June 10, 2012)

[FN4] Computer World online.  ‘Massive’ visa fraud alleged in lawsuit against Indian firm, April 4, 2012.  http://www.computerworld.com/s/article/9225847/_Massive_visa_fraud_alleged_in_lawsuit_against_Indian_firm (retrieved June 10, 2012)

[FN5] Gaming the System 2012: Guest Worker Visa Programs and Professional and Technical Workers in the U.S., AFL-CIO, Department for Professional Employees.  http://dpeaflcio.org/wp-content/uploads/Gaming-the-System-2012-Revised.pdf (retrieved June 10, 2012)

[FN6] Wall Street Journal Blogs.  http://blogs.wsj.com/indiarealtime/2011/07/28/infosys-employee-testifies-on-alleged-visa-fraud/ (retrieved June 10, 2012)

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