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Reconciling Innovation With Control: The Air Force's $1.3 Billion Lesson In Agile

What are we to make of the news that the Air Force recently canceled a six-year-old software modernization effort that had consumed $1.3 billion and produced nothing of value? Note, that’s $1.3 billion, not $1.3 million. And it’s not that the project produced less benefit than expected. It produced absolutely no benefits at all. The whole project has been canned.
The fiasco is described in the New York Times in an article by Randall Stross which notes that the Air Force’s effort began the project in 2006. It was “supposed to manage logistics using software from Oracle [ORCL].”
The Air Force awarded the $628 million contract to the Computer SciencesCorporation [CSC] to serve as lead system integrator; its job would be to “configure, deploy and conduct training and change management activities” before the launch.
The project had been “restructured” a number of times. When the Air Force realized that it would cost still another $1 billion just to achieve one-quarter of the capabilities originally planned that wouldn’t meet even minimal requirements—and that even then the system would not be ready before 2020—it gave up on the project entirely.
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