Geophysical Systems Corporation (GSC), which specializes in developing drilling equipment, developed a device that uses sonar to analyze the production potential of oil and gas discoveries. GSC needed a software program to analyze the data generated by the company’s sonar device. GSC hired Seismograph Service Corporation and paid it $20 million to write the computer system. To its dismay, GSC found that the seismograph system could not accurately process the massive volume of data and perform the complex computations needed. When this failing became apparent, GSC’s clients canceled their contracts. As a result, the company went from yearly sales of $40 million and profits of $6 million to filing for bankruptcy two years later.