Beating the ERP Learning Curve

For the past year, city, county and state governments have been implementing enterprise resource planning software suites to repair, upgrade and streamline business and technology operations.

Spurred initially by the need for Year 2000 compliance, civic agencies have leveraged financial management, human resources management and other ERP applications to achieve improved access to data, cross-functional integration, ease of use and increased automation. Within the next year, they plan to incorporate World Wide Web-enabled versions of ERP to realize such efficiencies as electronic procurement.

But none of that has come easy. By all accounts, implementing ERP takes time, and there is a steep learning curve. "You have to grow live instead of going live," said Gregg Jacob, the information systems and services manager for Tuolumne County, Calif. "It's a heuristic process. You can't expect to get it right the first time."

Still, in the end, these customers are seeing the hard work pay off as they learn to take advantage of the off-the-shelf tools and capabilities offered by PeopleSoft Inc. and SAP America Inc.

"A good example of using the Y2K issue to take a positive step forward is ERP in the state and local government. Here, they are making a more strategic business investment in software than they had before," said Dennis Drogseth, research director for Enterprise Management Associates, Boulder, Colo.

Other analysts also have observed local government's use of ERP as a launching pad for improving overall use of technology. "With the naming of [chief information officers], the focus has become more critical. CIOs are making strategic decisions about what technology they want to implement, and ERP allows them to get a snapshot of what is really going on across the jurisdiction," said Rishi Sood, principal analyst for Dataquest, Mountain View, Calif.

To simplify the process, most ERP customers are bringing the applications online in several phases. They move on to new applications or new users after each success.

Tuolumne County has just finished implementing PeopleSoft's human resources and payroll software. "We just did our first payroll on PeopleSoft in July. It went flawlessly. Everyone got paid on time," Jacob said.

The county initially chose to implement Peoplesoft's ERP solution to fix a hospital financial system that was not Year 2000-compliant and to create a unified financial system that included the hospital.

"PeopleSoft has really good utilities to bring data in from various sources," Jacob said. He used those utilities to integrate a hospital operations system, called Meditech, and to modify the human resources software to incorporate federal laws, such as Cobra, which allows employees to keep health benefits after they leave a job.

Jacob used PeopleSoft with Microsoft Corp.'s SQL Server to set up direct deposits in payroll. Because PeopleSoft SQL contains defined tables and relationships, it was relatively easy to write interfaces and to use SQL Server for the automated building of tables, he said.

PeopleSoft utilities are consistent with the application suite, so they are easy to use. "PeopleSoft utilities are the same the developers used to build PeopleSoft," said Mike Eberhard, vice president and general manager for the public sector at PeopleSoft, Pleasanton, Calif.

Sacramento County used ERP applications from SAP to fix systems that were not Year 2000-compliant and also upgraded an obsolete homegrown system. Dividing its SAP R/3 implementation into two parts, the county went live with SAP Financials in July 1998 and with SAP Human Resources and Payroll in December. However, the county still is refining the implementation.

"It's a very big system and a lifelong learning curve, so we implement more and more as we go along," said Georgia Cochran, project manager in the Office of Communications and Information Technology, Sacramento, Calif.

The initial phases of implementation are the most difficult. That is when IT departments discover how they can use ERP to solve technology problems, said Bob Salvucci, president of SAP Public Sector and Education, Newton Square, Pa.

"They are getting their house in order, so there's a lot of work in the initial implementation," Salvucci said. "They clean up data, do data reconciliation, eliminate redundancies, add details and determine who has the right data."

Sacramento County's most difficult implementation problem was mapping data from its old system to SAP data. As with most ERP implementations, the county worked with software and services consultancies-in this case, SAP partner firms-to tackle the data conversion.

In time, the learning curve shrinks and implementation proceeds more smoothly, said Jacob Desch, technical lead and principal IT analyst for Sacramento County. "Once we had written a few programs, we were able to write conversion programs every two days."

Learning Curve in Orlando

Orlando, Fla., also encountered a learning curve in ERP implementation. The city went live with ERP financial software in October and is phasing in OneWorld software modules from J.D. Edwards, Denver.

"Y2K drove the change," said Sherry Hilley, software support bureau chief for Orlando. The city converted from a combination of Arthur Andersen and homegrown software it had been using for 15 years to "the power and flexibility of the client/server ERP environment," Hilley said.

Aside from achieving a Year 2000 fix, Orlando wanted to solidify its investment in client/server architecture through J.D. Edwards' OneWorld package. "As their interest in client/server architecture grew, state and local governments started looking at ERP as a way in," noted Russ LeFevre, worldwide marketing manager at J.D. Edwards World Solutions, Denver.

OneWorld's online inquiry capability has relieved the city of intensive report writing. "Because I have so much power with online inquiry, I don't need to write as many reports," said Kristy Farrell, the financial systems manager for Orlando. "There's a lot of drill down capability in online inquiry."

Instead of using the city's Oracle Corp. database tools to retrieve information, Farrell uses the online inquiry capability in OneWorld. "It's almost equivalent to the power you get from a database query," she said. A query-by-example line internal to OneWorld shares information between modules and automates report writing. "I can also sort, sequence and export the information the way I want it," she said.

Within a year, all of these users plan to move to the Internet-enabled versions of PeopleSoft, SAP or J.D. Edwards software. "We definitely want to evolve to using the Internet as a distribution point for financial information," Hilley said. "We're in the process now of deciding what types of information we want to put on the Internet for citizens."

Civic users also would use Internet-enabled ERP for electronic procurement. "You can save a ton of money in the procurement area by centralizing contact management, decentralizing purchasing and inventory management," SAP's Salvucci said. Using an extranet, users could order inventory in a just-in-time fashion so that it arrives just when it's needed, eliminating waste, he said.

All three ERP vendors plan to release portals this fall from which users will be able to access the Internet, intranets or extranets.

Users also could use the Internet versions to manage distribution and to access information. "They could just go to the Web instead of having to go to the department to ask for it," PeopleSoft's Eberhard said. In fact, public-sector ERP users already have begun ordering. "In the last six weeks, our requests for electronic procurement have tripled," he said.

Civic government technology managers already are planning how to access or input information using publicly located thin-client kiosks to update the city on residents' marital status or address changes, for example. Sacramento County is exploring a plan to install Web-based PCs or networked machines throughout the county from which citizens could update mandated forms, Jacob said.

Cheryl Gerber is a free-lance writer based in Kingston, N.Y.