Should Vendor Executives Be Held Personally Liable For Failed Implementations? by Jon Hansen

Posted on October 13, 2015


According to an October 8th, 2015 article in the Portland Business Journal, The Oregon Supreme Court “sided with the state and denied Oracle America’s attempt to dismiss its top brass as defendants in the state’s lawsuit.”

Putting aside everything else pertaining to this story, including my belief that what we are now witnessing could very well be the beginning of a seismic shift in terms of practitioner – vendor relations, the Court’s ruling opens an interesting possibility going forward. Specifically, how would executive personal liability impact a vendor’s approach to both pursuing and winning business?

Remember a few years back, when the business world was awash in financial reporting scandals? The end result of that sorry period in corporate leadership history, was reflected in the changes to the law whereby the principal executive and financial officers of a public company had to certify that their annual and quarterly reports were accurate and complete. Said executives also had to verify that they established and maintained adequate internal controls for public disclosure.

Should we expect any less from executives in terms of vendor implementations – especially in the procurement world?

What if company executives had to personally guarantee that they had performed a “capability audit” before entering into a contract, verifying that they could indeed deliver a working solution within the appointed time and for the agreed upon cost. This capability audit would then become the basis to hold not only the company, but the executives themselves, personally liable if said implementation did not occur has promised.

Might this be the first important step towards obliterating the “let’s win the business first, and then worry about making it work later” mindset that has, for far too long, permeated our industry?

Executive personal liability: The end of finger pointing for failing initiatives?

Executive personal liability: The end of finger pointing for failed initiatives?


Posted in: Commentary