In this paper we give a direct and personal account of the issues and challenges that occurred in an action research study. The research team consisted of five researchers from two Australian universities. The action research case was carried out in a small financial services company and concerned the development of an information systems strategy. However, the focus of the paper is not on information systems, but on the general methodological issues and problems of action research. The authors hope that readers will benefit from the direct and transparent account of the practical methodological problems encountered in the study.