The $110m spent on the first product was the cost of the product plus the consultant time to implement it. Both of those were sunk at that point and could not be refunded. The decision was made that Product A was not working for the company's needs, and listening to the engineers, the executives decided to switch to Product B. The blame went to Product A and the company that makes Product A, because it's pretty fashionable to hate them right now. "The product is outdated, it's inflexible, it's not able to be customized" and so on. Product B was brought it and it's so much more flexible since it includes absolutely nothing out of the box, so more money was spent on custom development to build the batteries that Product A includes by default.
My company did cut a deal on the consulting for Product B since we had already been working for them on Product A, but the products were charged at full price and to my knowledge none of the cost of Product A was returned to the customer.
As far as management was concerned, Product A was a failure because it was old and inflexible. Management was super happy to see every screen of Product B with their logo on it, which we put on there because we had to develop those screens from scratch anyway. Product B didn't have their logo in the upper right corner, it only had their logo on the printed output.
The only lesson learned was "ask your engineers what product they recommend", which I guess is an important lesson regardless.
Thanks, extremely insightful. I've never worked on projects worth more than, say, 5 million euros so these 100+m projects have a sense of scale that's hard to comprehend.
My company did cut a deal on the consulting for Product B since we had already been working for them on Product A, but the products were charged at full price and to my knowledge none of the cost of Product A was returned to the customer.
As far as management was concerned, Product A was a failure because it was old and inflexible. Management was super happy to see every screen of Product B with their logo on it, which we put on there because we had to develop those screens from scratch anyway. Product B didn't have their logo in the upper right corner, it only had their logo on the printed output.
The only lesson learned was "ask your engineers what product they recommend", which I guess is an important lesson regardless.