Comment by thisisit

I agree. The $600M number seems way too much.

>Though, what I've historically seen is that only 10-20% of the funding request actually go to the software vendor. Organizations typically add 3-5x additional to either "pad" their request (in the event it doesn't get 'fully funded') and/or this is an opportunity for the university to higher for a bunch of roles they wouldn't have been able to get funded in the first place - so lots of things get buried in these numbers.

As someone working on implementing an Oracle solution for a large bureaucratic MNC this is also true. The padding often is 3x-5x with 5 year run rate the funding asks can be crazy. For people who are just looking at numbers it can seem crazy. But for anyone who is implementing it or renewing contracts they know the real numbers.

The migration costs though might be higher than $10-20M. Contractor costs can be crazy too. Sometimes costing multiples of the software costs.

In my current practice I do notice that the vendors - both software and third party implementation partners - have a chummy relationship with a decision maker. This creates a lot of misaligned incentives when it comes to "company's" money.