Hardware upgrade in the Secretariat of the State of Michigan (USA) in 2015

2015: Tightening of the project for 5 years

On September 21, 2015 it became known that the authorities of the American State of Michigan submitted a claim against HP for the fact that the American corporation did not execute the ordered updating of computer systems which began 10 years ago in a number of public institutions.

In 2005 HP received from the Secretariat of the State of Michigan (U.S. Michigan Secretary of State) the contract for installation of a new computer hardware instead of the old mainframes created in the 1960th years. The technology giant had to complete the project in 2010, but terms were broken. Moreover, by September, 2015 all 131 department of SOS remained on outdated IT solutions.

Filed a lawsuit against HP for the broken state order for updating of the IT equipment of the 1960th years

According to the state secretary of Michigan Ruth Johnson, by 2011 when she headed the Secretariat of the state, received HP within the project of $27.5 million, but at the same time the company "did not perform simple work in the state".

Total payments to the producer made about $33 million. They are going to be collected through court. Besides, authorities of the state demand $11 million compensation for damage and compensation of legal expenses. In total the amount of $49 million appears in the claim.

Michigan broke off the contract with HP unilaterally at the end of August, 2015. Though under the terms of the agreement of HP had to give technical support within 270 days from the moment of cooperation termination, the staff of the company ceased to work on the project almost right after its official end.

"It is a pity that the State of Michigan decided to terminate the agreement, but HP hopes for the safe dispute resolution in court", said in the statement of the American producer of the computer equipment.

As notes the Business Insider edition, failure of big state orders in the field of technologies – not it and an unusual occurrence. According to analysts of McKinsey, a half of IT projects with budgets more than $15 million finally cost customers 45% more posted price, and in 7% of cases contractors skirt deadlines.^[1]

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