Over the years I’ve taken part in the replacement of many Enterprise Resource Planning (ERP) solutions
for local government. These systems provide huge value as they help councils to be more efficient and effective, but the community doesn’t see any of this, which makes it hard for councillors to justify the spend on upgrading IT systems. I believe this is where councils are going wrong. The solution is for councils to change the way they implement these solutions.
Why councils upgrade?
ERP replacement usually occurs due to a poor existing system or software that is running out of support, due to changes in underlying technology. In some cases, the council had outgrown their current system. I have been in meetings where councillors have asked, prior to replacement solutions going ahead, whether the current system produces accurate rates notices, pays suppliers, and caters for regulatory events. The answer in almost all instances is yes, which results in questions as to why that system or software needs to be replaced at all!
Councillors know that these types of solutions do not help them get votes, because the community has no way of seeing the value of these internal systems. This makes councillors very cost sensitive, because councils have limited resources and every dollar spent on internal systems is a dollar they will not be spending on community facing solutions, such as, road replacements, community buildings, parks and amenities.
What happens now in ERP implementation?
Currently, the majority of ERP replacements are completed in two stages. Firstly, to replace existing functionality and secondly to improve systems. In most cases the first stage produced the desired results, but as project fatigue sets in, the rest of the improvements promised may not eventuate. Those promised improvements often included online capabilities for communities, improved reporting (business intelligence) and communications with the community. These modules are exactly what is needed to demonstrate the value of information technology to the community, yet I suspect many councils have not implemented these modules.
What needs to change?
Solutions that are relevant to the community should be implemented first, not at the back-end of the project. Many solutions have the ERP as a pre-requisite for the online and community facing solutions, which forces councils to go ERP first. But this is holding many councils back. There are now solutions available that achieve these community facing requirements upfront.
If councils were able to do this, they could demonstrate to the community that the information and communication technology investment they make is relevant to them, they would then justify more IT investment on asset management solutions, enterprise resource planning solutions, geographic information systems, document management solutions, and other back-end solutions. In fact, the advent of open solutions (native cloud) will make the information in these solutions relevant to the community and continue to reinforce the relevance of IT.
Better community outcomes
Better services through online channels will allow councils to enable communities to self-serve and allow councils to redeploy staff to front-line services. These savings and improvements in service will then help pay for the replacement of the back-end solutions, which in a modern scenario should be Software-as-a-Service (SaaS) anyway.
The key to showing the value of council IT spend is better services into communities. This helps councillors and ultimately the communities they serve.