Source: GCN

In the age of cloud computing, monolithic systems are headed for a piecemeal approach

 

The verdict appears to be in on all those enterprise resource planning suites installed in agencies and departments since the mid-1990s: Some good, some bad …and something’s got to change.

ERP horror stories abound. Millions of dollars have been lost and organizations’ business processes thrown into turmoil, all in the pursuit of centralizing management of enterprise data.

“The path to success is littered with programs that have failed or where the plug has been pulled before they ever even get to a prototype of the system,” said David Lucas, Chief Strategy Officer for Global Computer Enterprises, a system integrator. “There are many multi-$100 million failures.”

 

Terry Hurst, director of Information Systems Management Services at the Health and Human Services Department, agreed. “I’ve been doing ERP implementations for 15 years with various companies,” he said. “I’ve had good experiences, bad experiences and failures, so I’ve covered the gamut.”

 

 

And there have been successes. Hurst cited HHS’ recently completed, $219 million, six-year rollout of an Oracle E-Business Suite ERP to manage financials as a success, noting that it came in only 4 percent over budget.  “That’s excellent,” he said, “especially when you’re budgeting something six years out.”

Less successful, he said, was the department’s $30 million human resources system ERP from PeopleSoft. According to Hurst, the department wanted to keep initial costs down, and that resulted in only a “fairly narrow version of the functionality” being implemented. That, he said, resulted in less satisfaction with the system. 

The outright failures of some ERP efforts and the dubious performance of others have prompted many analysts to question whether there’s something inherently flawed in the idea of building large, centralized ERPs. And that’s especially true in this era of rapid technology change and constricting budgets.
An ERP is an integrated set of applications and middleware designed to manage enterprise resources, including finances, human resources, assets and inventories. ERP abounds in government, but if it is to survive in the future, some analysts say, it will have to change dramatically.  “The days of the $36 million, 28-month ERP implementations are gone,” said Michael Fauscette, group vice president for software business solutions at IDC.