IBM's system which replaced the entire human payroll department by fracture creates a loss of 82 billion yen

ByKen Teegardin

In 2008 the Canadian government abolished the payroll department to reduce departmental personnel costs and from IBM received payroll system "Phoenix Pay System"Was introduced. However, the system that was in operation did not calculate the salary of staff normally, it became a problem, and the current Canadian government has grown to the point of investing about 1 billion Canadian dollars (about 82 billion yen) in order to end the situation.

Canada to Scrap IBM Payroll Plan Gone Awry Costing C $ 1 Billion - Bloomberg

A project to introduce Phoenix (Phoenix) from IBM, the so-called "Phoenix Project" was carried out in 2008 to concentrate the government's payroll centered on the computer in the age of Conservative Canadian administration during the administration of the Canadian Conservative. IBM received an order for a delivery contract to install and operate payroll system using Oracle software.


Justin Trudeau of the Canadian Liberal Democratic Party took office in 2015 as the ruling coalition government replaces the Canadian Conservative Party with the Canadian Liberal Party, and the system has been in operation in 2016, a few months later. However, this system did not work properly from the beginning. In addition to the increase in the payment amount of salary of several staff members, there are problems such as staff members whose salary has become unlimitedly zero, and a large number of requests for correcting this problem are sent By doing so, the problem grew snowballing.

Concerns over the payment of more than 260,000 Federal civil servants working in Canada have yet to be resolved has been solved and it is forced to postpone some major financial decisions as a response to the problem There is no situation. The staff declined promotion and retirement, afraid that salary will change as more problems arise. In 2018, two years passed since operation, problems still occurred in salaries of some staff members, and the latest unprocessed data amounted to more than 380,000.

ByKMR Photography

IBM stated in his opinion that "the fulfillment of the contract of the Phoenix project has been fulfilled and the software is functioning as intended," IBM said in a statement, "Continue to cooperate with the administration's efforts to solve the project problem We are working to succeed the whole project. " On the other hand, Oracle 's agent, the system software maker, declined to comment.

ByJesper Angelo

Debi Daviau, the representative of the major union of government officials, was largely responsible for this problem, despite the conspicuous signs that the system was not ready, to a senior government official who operated the project I said there was. Mr. Daviau also raises questions as to why IBM has advanced the project despite the problem and whether it benefited from a project that the system is not running as specified in the contract.

In an interview, Mr. Daviau said in an interview: "When a schedule becomes stalled and needs to be ignored for additional product testing, firms do not firmly fortune to delay projects until they are ready like IBM, The high officials should have known well.It has a contract with the government including support, so the possibility that IBM will postpone the contract despite being unable to fulfill the predetermined contract content "This means that for IBM, it means" big money keeps rolling "."

ByKen Teegardin

Scott Brison of the Board of Governors of the Treasury, "As a sophisticated global company IBM, not only is the Canadian government one of the only important customers, but does not support the solution of this problem We will need to realize that we have the risk of reducing reputation as a company (reputational risk), "IBM stated that it should support revision of payroll system.

This major failure proves how difficult it is to introduce the technology of the 21st century to the government from enterprises that have received a lot of orders like IBM and it will hurt and hinder business. IBM, based in Armonk, New York State, has not revealed the percentage of total revenue that is accounted for by revenue from government contracts.

This is not the first time that IBM was in the fire of pay system trouble. Also in Queensland, Australia, there is a case where the contract is canceled by abolishing a similar project, and the government will bear the cost of 1 billion Australian dollars (about 82 billion yen). Official surveys mainly challenged Australian government officials, but we concluded that IBM should not be selected as an operator. IBM challenged part of the findings in 2013.

Canadian Bill Morneau Finance Minister announced that the former administration had made a mistake to dismiss employees needed to implement the Phoenix project, but "this is not for accusation It is for putting things in a normal state. " On Tuesday, February 27, 2018, the Canadian government announced that it will begin budgeting to freeze the ban and stop the Phoenix project and find a new solution.


Phoenix Project originally dismissed 1,200 employees processing payroll in various departments throughout the country and hired Phoenix to handle most of the government salary to reduce the number of people who operate the system to 500 people It was the purpose of centralized management and cost reduction. The Canadian government's accounting audit division survey found that many of the newly hired personnel in this sector were inadequately educated and worked in overwork condition. Installed software was remodeled considerably based on Oracle's PeopleSoft, but it was refurbished so that complicated payroll calculation can be done according to its own shift such as other coast guards and prison escorts It was not.

"Phoenix's failure is an expensive new technology project, a typical example of a government that wants to save on budget by reducing the number of employees, but through that, people It turned out later that it was a necessary human resource. " Mr. Wallis said, "This payroll system project did not reach a bid due to judging other companies that are not IBM" too complicated ", but IBM did it." Mr. Wallis says, "Many projects that are expected to save budget in the short term are illusory, it is a major problem not only in the government but also in the case of large-scale technological change, I think that it was necessarily inevitable only in this case I think that it is necessary to take it seriously, "he says that it is not a special case. According to the IT survey advisory firm Standish Group, which is investigating thousands of projects each year, most of the projects that transform technology between the private sector and the public will fail or face serious challenges.


On February 28, 2018 (Wednesday) a representative of the New Democratic Party of the opposition party of Canada asked the prime minister to stand in parliament. There was a person whose salary is less than 40,000 Canadian dollars (about 3.3 million yen) in his own constituency and asked what the Prime Minister did.

Prime Minister Trudeau said on the issue of the Phoenix Project made by the opposition 's former opposition party administration "We did not create this mess, but we are going to fix it."

in Note,   Software,   Hardware, Posted by darkhorse_log