When ERP projects go awry: Surrey County Council incurs £3.2m additional costs in delayed Unit4 project
- Reference: 1641814328
- News link: https://www.theregister.co.uk/2022/01/10/surrey_county_council_3m_unit4/
- Source link:
Following a testy council cabinet meeting discussing the budget-busting slippage, the project is set to go before the council's Resources and Performance Select Committee later this month.
The cost increase of £3.2m represents a 14 per cent hike on the original planned total implementation budget of £22.4m between 2020/21 and 2023/24. However, [1]the council already agreed to £718k annual SAP support and maintenance cost to keep their existing ERP system – [2]which dates back to 2004 – up and running. The total estimate for the four-month delay from December 2021 to April 2022 is just north of £3.9m.
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In September 2020, the council [4]signed a £30m deal with Unit4 to supply software as a service until 2035. The contract had originally been [5]erroneously advertised for £40m .
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[7]
Speaking at a cabinet meeting on 21 December, Tim Oliver, the Conservative council leader, said the body had hoped the project would be delivered by the end of this year. "As always, inevitably, with any IT program, these things take a little bit longer as things move around. There is an additional cost because specification has changed."
Will Forster, Liberal Democrats Group leader, challenged Oliver's conclusion. The cabinet meeting and related papers were not "really saying all the information that the council is aware of," he said.
[8]
"This is a delay, and this is an overspend because something has gone quite badly wrong. The project was meant to cost £22m and your decision would mean an increase of £3m because of these issues," Forster said.
Oliver then refused to concede the project had gone wrong. "I think that's an inappropriate phrase. There are lessons to be learned, and that's something we haven't discussed with our officers. This is a complicated project. It is moving significant parts of our system onto a new system. As that process happens, inevitably, there are changes that are needed," he said.
[9]West Sussex County Council faces two-year delay to replace ageing SAP system for Oracle
[10]UK and Ireland S/4HANA migrations accelerated during 2021 COVID-19 lockdowns, figures reveal
[11]Infosys awarded contract to replace East Sussex County Council's ageing ERP system
[12]Hitting underground pipes and cables costs the UK £2.4bn a year. We need a data platform for that, says government
Nick Darby, Residents' Association and Independent Group leader and chairman of the Resources and Performance Select Committee, said it was fair to say that "the project did go off track" and he looked forward to discussing the issues at the select committee hearing later in January.
"We need to learn lessons now and to avoid similar issues in the future," he told the meeting.
Leading the project is Andrew Richards, interim digital business and insights programme manager, who trades as A C Richards Consulting. His £177,000 fee covers the years 2019/2020 and 2020/21. He is being retained by the council, as he authored the cabinet report describing the cause for the delay, although the council has yet to reveal the cost and length of his contract extension in response The Register 's questions.
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[14]Richards' report [PDF] identified two problems holding up the project.
Data migration had caused difficulties because "the quality of the migrated data received in September for User Acceptance Testing was of insufficient quality and completeness to enable effective testing, severely impacting the coverage and pace of activity."
Analysis found issues identifying the correct data in the existing SAP R/3 system, determining how the council's data needs to be transformed for use in Unit4. There were also gaps in the council's data.
Meanwhile, the project team received a "volume of new or clarified requirements" for the system's HR module, which "emerged during the Build stage when business stakeholders were able to physically see the solution for the first time." These issues "extended the build timescales and caused a backlog of work for the supplier."
"In addition, a key assumption agreed during the high-level design stage regarding reuse of the same forms across both council and external customer payroll users was invalidated. By September it became clear that the combined impact of these issues was increasing the build workload for the supplier and causing delays to the start of users acceptance testing for HR and payroll, rendering the December go-live unfeasible," the report said.
The implementation team now plans to focus on completing User Acceptance Testing and Payroll Parallel Running activities to complete by the end of January 2022. "The team will then progress the plan to prepare for and deliver the cutover to the new Unit4 ERP system for go-live in April 2022," the document said.
If it fails to meet that date, there could be knock-on consequences. Other council IT projects and plans rely on the completion of the Unit4 implementation, it said.
Surrey County Council is not the only public authority to hit difficulties implementing Unit4. Edinburgh City Council planned to replace Oracle with Unit4 by 2018, but abandoned the mission to stick with Big Red, [15]a move which led contractors Agilysis and CGI to court .
But council ERP problems are not unique to Unit4. West Sussex's County Council's [16]Oracle project has been delayed by two years . ®
Get our [17]Tech Resources
[1] https://www.theregister.com/2021/10/07/surrey_county_council_sap_support/
[2] https://www.theregister.com/2020/01/27/sap_system_surrey_england/
[3] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/databases&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=2&c=2YdxmP1C5a6jUa26qj9JVmQAAANA&t=ct%3Dns%26unitnum%3D2%26raptor%3Dcondor%26pos%3Dtop%26test%3D0
[4] https://ted.europa.eu/udl?uri=TED:NOTICE:440857-2020:TEXT:EN:HTML
[5] https://ted.europa.eu/udl?uri=TED:NOTICE:028519-2020:TEXT:EN:HTML
[6] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/databases&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YdxmP1C5a6jUa26qj9JVmQAAANA&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[7] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/databases&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YdxmP1C5a6jUa26qj9JVmQAAANA&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[8] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/databases&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=4&c=44YdxmP1C5a6jUa26qj9JVmQAAANA&t=ct%3Dns%26unitnum%3D4%26raptor%3Dfalcon%26pos%3Dmid%26test%3D0
[9] https://www.theregister.com/2021/12/14/west_sussex_county_council_faces/
[10] https://www.theregister.com/2021/11/29/uk_and_ireland_s4hana_migrations/
[11] https://www.theregister.com/2021/11/02/infosys_east_sussex_contract/
[12] https://www.theregister.com/2021/10/20/national_underground_asset_register/
[13] https://pubads.g.doubleclick.net/gampad/jump?co=1&iu=/6978/reg_software/databases&sz=300x50%7C300x100%7C300x250%7C300x251%7C300x252%7C300x600%7C300x601&tile=3&c=33YdxmP1C5a6jUa26qj9JVmQAAANA&t=ct%3Dns%26unitnum%3D3%26raptor%3Deagle%26pos%3Dmid%26test%3D0
[14] https://mycouncil.surreycc.gov.uk/documents/s83436/DBI%20Cabinet%20Report%20-%20December%202021.pdf
[15] https://www.theregister.com/2020/11/03/city_of_edinburgh_council_selected/
[16] https://www.theregister.com/2021/12/14/west_sussex_county_council_faces/
[17] https://whitepapers.theregister.com/
"There is an additional cost because specification has changed"
When will they learn?
This Must Never Happen Again
"I think that's an inappropriate phrase. There are lessons to be learned, and that's something we haven't discussed with our officers".
Re: This Must Never Happen Again
Also reading the article, there is a suggestion that as usual, this is yet another failure that is in part due IT pushing their preferred solution to IT's specification (after engaging a few consultants who spoke to manglement. IT have then utterly failed to understand that if the system does not do the users need it to do, there will be problems.
The usual course of action is to now blame the failure on the users and project rather than where the actual fault lies: in IT.
This happens again and again. Each time IT wriggle their way out with a load of incomprehensible techno-babble to cover the arses.
Just waving fingers and political point scoring will never fix this. It is a cultural issue that IT perpetuate because it ensure jobs for the boys.
In the time a worked for a LA this happened on most large projects. Each time there was a reorganisation, IT head-count remained static or increased "due to the challenges or running a busy public service".
Re: This Must Never Happen Again
It depends. As a public sector programme this would have had to have gone through a regulated tender process where any interested suppliers would have had to have mapped the "point in time" business requirements - against the capabilities of the product being recommended for implementation.
I would be highly surprised if the entire process was IT driven only and had no involvement of the end users or business departments.
What I can believe however is : (A) that due to existing workload, the business users or business analysts didn't really take the requirements / process mapping seriously enough, or get enough time with the key parties to review the new system and discuss those overarching business changes. (B) That data migration is hard if the business doesn't really understand its data, how it is used, and where it is silo'd. (C) That even the tea lady generally wants a say in the governance of reports and reporting.
Re: This Must Never Happen Again
Very likely also (D) the "business users" aren't actually the business users, they're manglement at some higher level who think have no experience of what the current system does day to day, how it's actually used and how the new system needs to work and be used day to day.
"Surrey County Council is not the only public authority to hit difficulties implementing Unit4...But council ERP problems are not unique to Unit4..."
It would be interesting to compare the IT staffing levels of these councils with those whose projects don't make such good Register copy.
I *suspect* the results of such a study would be revealing. It would be good to know.
When have you ever seen an ERP project go right? ERP is a four letter word.
Every time I have been involved in one, it's quickly learned that the folks doing the work are usually under-qualified, and then they start asking for change orders for everything, stating the project wasn't scoped correctly. If it does get done, it's usually a hack job that has problems just to say they finished anything, then just continue to request more change orders to fix them, and never really "finish" what so ever.
I pity the folks that have to work with ERP companies and software.
Changing an ERP is a mammoth task. No surprise there are surprise it. However, these surprises should have been anticipated, as any ERP change goes this way.
What I don't understand is why a council need an Entreprise Resource Planning system. What do they produce? What process have they to supervise? What stock do they need to manage? :~
"This is not a failure, there are lessons to be learned" : I'll keep this one, could be useful some day ^^
Clarified requirements once they were able to see the solution for the first time
It said
" the volume of new or clarified requirements" for the system's HR module, which "emerged during the Build stage when business stakeholders were able to physically see the solution for the first time"
I thought these days ( this century) you gave people a working demo of the front end for people to use - before signed off the requirements.
I remember my sister (a nurse) gave lots of comments... for example.
"It is pretty that the boxes line up - but I do not need an input field 10 chars wide for Mr/Ms/M .. and a only 10 char field for surname"
"Why is the data I need about the patient on page 3 of the system and not the first page? I dont care about patient history when I'm trying to check the pills the patient needs"
"Where is the consultant's name?"
and so on.
The end user requirements had been "obtained" from the office staff - not the ward staff, because the ward staff were too busy.
Find a council that has a working ERP system, and copy it...
Hardly rocket-surgery.
Please make consultancy cheques payable to ... etc, etc.