The Real Cost of Consolidation

In his blog The Risk Factor, blogger Bob Charette wrotes about Wisconsin's four-year effort to consolidate networks to save money and improve administration. The state auditor has some results:

• Consolidating servers was supposed to cost $12.8 million, but the initiative has cost the state almost $91 million and if completed as predicted next year will cost $110 million.
• Wisconsin has consolidated e-mail systems at a cost of $13.4 million - a bit more than the estimated cost of $2.6 million.
• The state wanted to create the Integrated Business Information System to replace much of the existing administrative software used by state agencies. The estimated cost: $135 million, with predicted savings of as much as $91 million over a ten year period. But in April 2008 Wisconsin suspended work on the system because state financial problems kept agencies from providing IT personnel to staff the project. About $9 million had been spent on the project.

Says Charette:

Given the previous overruns of nine and five times over planned budget on much simpler IT projects, taxpayers in Wisconsin should probably heave a huge sigh of relief at the IBIS suspension.