By Freya Purnell
A report by the NSW Auditor-General has revealed the state of play with the NSW Department of Education and Communities’ eight-year IT transformation program.
The Learning Management and Business Reform (LMBR) program began in 2006, to replace existing finance, human resources and payroll systems, as well as student administration systems, with SAP.
However the report shows that five years in, the program has been revised with implementation dates deferred to ensure the final system meets expectations, following disappointment with the SAP Financials implementation delivered in the first phase.
The Department’s original program was to be delivered in two phases – with SAP Finance to be implemented in state and regional office locations, for TAFE NSW and in schools during Phase 1. SAP Human Resources and Payroll was to be rolled out to TAFE NSW during Phase 1, and then to schools and state and regional offices in Phase 2, with an original go-live date of mid-2011. Phase 2 also included the implementation of a student administration system, planned for go-live in 2012/13.
However, the project ran into problems when the implementation of SAP Finance at state and regional offices in March 2010 “did not provide all expected benefits to the business”, according to the report by NSW Auditor-General Peter Achterstraat.
The report said the system did not meet the needs of users, requiring manual workarounds to be built and resulting in lost time and additional costs. Other issues were a lack of accurate, relevant and timely information accessible by users, insufficient user knowledge of the system and its functionality, and a lack of skills, resources and knowledge in the Shared Service Centre to fully support the system.
Following a review of the project earlier this year, the Department changed direction on the project, instead opting to appoint a provider to manage the implementation of an integrated, end-to-end solution instead of separate SAP systems. Implementation dates were also revised to accommodate the new approach.
Achterstraat reported that NSW Treasury has approved an additional $14.4 million to fund additional staff and training for the new integrated solution.
The cost of Phase 1 of the project has been revised up from $153 million to $210 million, with the estimated cost of Phase 2 down from $218 million to $176 million – bringing the total project cost to $386 million. At 30 June 2011, the Department had incurred costs of $176 million to date.
The Australian newspaper has reported that IBM and Accenture are competing to provide the integrated solution, with the new system planned to be piloted by late 2012.
Achterstraat said the review also involved a review of the project’s governance model, training and testing procedures, and the role of the Shared Service Centre.
