22 June 2011

The best run businesses run SAP

That is what Mr Mustard got as the top google result when he put SAP in the search box and hit enter.

Of course very badly run businesses can also buy it. They won't suddenly become well run businesses ( or Councils ) overnight or even over the next decade.

Now Mr Reasonable is Barnet's leading critic of the spending on SAP and I thought I would just add a little history as I researched it for my own pleasure.

SAP started out as a little baby back in the 80s and was born ( some details of the courtship leading up to the birth of this little monster are on the SAP page to the right of the blog ) because as set out in para 3.1

"The Modernising Core Systems Programme is fundamental to the delivery of the corporate priorities, as laid out in the Corporate Plan 2004/5-2007/8. It is particularly significant to the attainment of the priority of delivering ‘a better council for a better Barnet’ through investment in modern systems. The programme also supports the delivery of the majority of objectives set out in the Information Systems, Borough Treasurer’s and Human Resources Performance Management Plans."

Leaving aside the question of why only the Borough Treasurer possesses an apostrophe - perhaps he keeps the entire stock of Barnet's apostrophes in the Council's coffers or perhaps the majority of them were lost in Iceland -  I note a slogan that has been cast aside like a worn out pair of shoes 'a better Council for a better Barnet'. Mr Mustard rather likes the sound of that; if only it could have come true ( a blog is coming in the next few days about what the residents of Barnet think about Barnet Council - it will be good, or bad, depending on which way you look at things ) . Sorry to tell you this Barnet Council but your 'Better shoes for less money' have a hole in the sole before you have worn them many times - Mr Mustard prefers the quality option 'Better shoes for more money' as that gives quality and longevity. 

If you read lots of the documents knocked out by Barnet Council you start to notice a theme.  It is a combination of expectation management and puff.

Barnet Council decided to accept some risk in this project. This was agreed on the basis that

  • 4.2 - appropriate structures can be put in place to identify and manage risk.
 Oh dear, the structure that is Procurement seems to have tumbled to the ground. Why, because you didn't maintain ( keep up ) the structure Barnet Council. So that was an example of puff.

This sort of system needs very careful thought before it is purchased as once the decision has been made the supplier has his hooks into you and you can't get them out, the only way forward after that is yet more hooks whilst he drains your lifeblood.
  • 5.5 The capital budget for the replacement system approved by Council on 2 March 2004 is £2.5m. This was an estimate based on the “best of breed” solution for finance, which was consistent with the approach in reports previously submitted to Cabinet ICT Committee. As this report advises, and as a result of the procurement exercise, an integrated solution is now proposed and it is currently envisaged that the additional reports referred to in paragraph 5.1 will be seeking a significant increase in the capital budget, which will include contingencies referred to in paragraph 5.4.
How did the spend get past £20million ?

And here is some expectation management

  • 7.6.3 The implementation of a new project will have dramatic effects on the organisation, not only in work load requirements up to and after go live, but also when go live occurs. It is reasonable to consider that the authority will suffer a degree of reduced performance, due to changes in working practises and the demands made on persons by the new system. For a period after go live, as the organisation recovers from this, there will be significant short term failings i.e. BVPI8 (time taken to pay invoices). These risks will be addressed through the ongoing maintenance and review of the risk register and appropriate mitigation action being taken.
Then in the document we come to:-

Appendix A - Modernising Core Systems Programme Board, 2 July and Cabinet Resources Committee, 8 July 04 
Resource Descriptions, Role Definitions and Structures

The report details 6 members of senior management and 11 project team roles. The first, and presumably therefore the most important, person listed was the project sponsor. Here is the definition of his role:-

The project sponsor directly communicates the organisation’s long-term goals and visions. 

The project sponsor:

Is the ultimate owner of the project and has decision-making power in the fulfilment of the primary responsibilities, as outlined for the Project Board members

Maintains the final authority to set priorities, approve scope, and settle organisation-wide issues

Promotes the project throughout the organisation. Where conflicts exist in the completion of these responsibilities, the sponsor is empowered to negotiate and promote a solution.

Has final budget authority

The project sponsor must have:

An executive-level presence within Barnet

A clear vision of the organisation’s goals and how the project aligns with those.

The ability to make critical decisions under significant time pressures

Strong leadership skills and effective negotiation skills

A proven record of being proactively involved with organisational issues The ability to maintain good communication skills.

So whose (non) sticky fingers filled this seat ( sorry, mixed metaphors ) Yes, the then Assistant Chief Executive, Nick Walkley.

Didn't he do well !

Now there are just a few other snippets I want to share. I liked this point from Appendix B ( having your appendix out is possibly less painful than reading documents that emanate from Barnet Council )

  • 7.1 Business Change - Generally, during implementation of the new system, it is expected that the business process is changed to match the system.
Or put another way, The tail is wagging the dog.

So a fortune has been spent on a system which does not match the requirements of the Council. The Council has to shoehorn itself into the system. Great.

It is a pity that Mr Mustard did not read this last week before he went to the Audit committee meeting last week as he would have asked a tough question. Never mind you can read it now Councillors.

7.3 Longer Term Benefits

In adopting a best practice model for the operation of core processes for Barnet, there will be improvements in various facets of the organisational operation: Reduced procurement costs through increased focussing the buying power of the Authority. It will be mandatory that the business utilises the preferred supplier arrangements negotiated by the Procurement function.

Oh no it won't !

Oh, and I cut and paste that garbage; I did not alter it in any way so if the English hurts please don't blame me.

And finally here is the risk evaluation matrix :-


High = Further action needs to be immediately considered / taken and risk requires reporting

So SAP was a very risky project.

Have the risks been properly managed.

Mr Mustard does not think so.

Yours frugally

Mr Mustard

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