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Comment by seldo | Hacker News Reader

Why make people do math? It's $500 per employee assuming the $30m figure in the headline (which doesn't actually appear in the article). They spent $28m on another system they never used, and are about to spend $12m on the second attempt, making it $40m in total, or $666 per employee.

Either way, holy cow.

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I know of a Smalltalk system reputed to have similar capabilities, developed by a Chicago area community college for only $4 million. (I've heard that both systems go beyond just payroll, and are like complete ERP systems for college/university organizations, and can keep track of payments due to them from the government based on resource utilization, which is also integrated with registrar functions.)

This is what the big consulting houses do. They convince the board that it's rocket science, but that they're just the very smart, credible, impressive looking people to do it for you. But they are motivated to inflate the price.

Let's call it $70 per year per employee, since we're going to amortize it a bit.

That is, what, a tenth of a percent of the fully-loaded cost of the cheapest FTE they have? It is wasteful, but it is wasteful in a way that is rounding error next to the cost it will be compared to.

And the $12m is just for the initial planning stage, no actual implementation, so the final cost will be much higher. But you get to amortize it over ~35 years.

Or if your accountants are clever enough, amortize it over 200.

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