Houston plans major ERP project

During the next two years, Houston will become one of the largest American cites with modern financial management, payroll, human resources, procurement and materials management systems to help city employees share information and increase efficiency.

Steve Peck, president of SAP’s public services sector, which is providing and implementing the enterprise resource planning (ERP) software for the Texas city, said there’s definitely an upward swing among major counties and cities with decades-old legacy systems to upgrade their systems.

This is partly because of an aging government information technology workforce whose members will be retiring in greater numbers during the next few years. “The guys that wrote the systems and know how to maintain it and deliver critical services are becoming few and far in between,” he said. “The risk factors alone in not doing something are strong.”

But modern systems help city employees better cope with planned and unplanned services, such as Houston taking in tens of thousands of evacuees after Hurricane Katrina struck the Gulf Coast.

Houston city officials have been planning for an ERP system for some time. In late April, the city council approved a contract with SAP for the $23 million project called HoustonOne, and the initiative was officially kicked off in mid-August. The influx of hurricane evacuees in early September didn’t delay the project, Peck said.

The financial management and procurement systems are slated for a July 2006 deployment, while the human resources and payroll applications are planned for an early 2007 deployment. The city formed a governance committee comprised of city department directors to oversee the project, which will also standardize processes citywide.

“First, by replacing the existing systems, we will eliminate a serious risk that our aging systems could fail and force the city into extraordinary efforts to manage our finance functions,” Mayor Bill White said in a statement during the August kickoff. “Second, by implementing a state-of-the-art ERP system, we will have some important new technical tools for continuing to transform City Hall into the most efficient and responsive local government in the nation.”

City and SAP officials are currently involved in the project’s planning phase.

“We really are going through mapping out the business processes, making sure that we’re not paving cow paths,” Peck said.

“If there are decisions that need to be made about policy or processes that span multiple organizations that’s where their governance structure will kick in real well ultimately landing on the mayor’s desk if he needs to make a hard decision about certain processes,” he added.