Making an enterprise system work for your organization.

• Author: Roque, Rob

[ILLUSTRATION OMITTED]

There are a number of potential pitfalls that could prevent an organization from maximizing its return on investment in an enterprise system. Having some guidelines in place can help protect a substantial technology investment during rough economic times.

Originally attractive to the public sector because of the Y2K technology crisis, modern enterprise solutions provided a ready fix to what was perceived at the time as a pervasive problem. In more recent years, the trend in the public sector is to purchase enterprise solutions for their capability to effectively meet modern user requirements such as self-service, social media, and government transparency. But the public sector needs to make sure it is using its current enterprise systems to their full potential and not becoming too quick to replace modern applications.

THE ISSUE AND WHY IT MATTERS

ERP systems make use of proven technologies (sometimes in the form of "bolt-on" third-party applications) to improve the balance between responsiveness and stability, allowing modern solutions to react efficiently to changing business needs and customer requirements. Right now, it is possible to log onto an ERP application anywhere in the world and conduct business. Right now, it is possible to have information such as bus arrival times pushed to citizens' cell phones and computers. In the future, it might be possible to merge government solutions with citizen appliances, like a smart phone that allows residents to check the availability of a picnic shelter they see in a park and reserve the shelter and pay the rental fee on the spot. Citizens increasingly expect these capabilities. Fortunately, modern technology solutions do not require a huge amount of programming effort--although they do require public-sector organizations to make some changes.

The impact of citizen expectations can be substantial. For example, the City of Philadelphia, Pennsylvania, plans to spend as much as $120 million in technology infrastructure over the next several years to streamline business and reduce costs. (1) Most organizations will not spend this much, but they will still devote a substantial amount of limited resources to identifying the right technologies to invest in. That means the finance officer (and the technology officer) need to figure out what technologies will maximize efficiencies and service, and how to protect the organization's investments in technologies.

TECHNOLOGY IS AN ENABLER

Jurisdictions often want to make a substantial technology investment such as purchasing ERP software because of the bells and whistles. Being able to implement employee self-service or business intelligence, or the ability to distribute reports with scorecards are very attractive. Focusing on such features loses sight of the true objective, however.

Other organizations have different reasons for considering an ERP system. Take, for example, an executive officer who invested in an integrated system while facing sizeable expenditure reductions, including layoffs and other drastic measures. He felt that his current legacy management systems had become a liability and that he couldn't use them the way he needed to--so he could analyze his operations more efficiently and identify opportunities for improvement. He was able to outline his vision for how technology could be used to aid business transformation within his organization.

Initially, there might not seem to be that much difference between these scenarios. However, the executive officer who had a clear business purpose for the technology investment viewed technology as an enabler and was able to envision an alignment of technology with a business requirement. Technology projects that do not align business requirements with technology solutions generally fail.

OPTIMIZING THE ORGANIZATION FIRST

Unfortunately, aligning business and technology is not easily accomplished. In general, during the beginning stages of enterprise projects, organizations have every intention of aligning business and technology. But those good intentions fade as the project progresses. There are many reasons why, but it generally boils down to the availability of resources or the organization's ability to absorb the change associated with the new business application. A 2003 Government Finance Review article describes how difficult it can be to implement best practices that are imbedded in commercial off-the-shelf software:

Studies suggest that organizations don't fully realize the reengineering potential of ERP. One reason is that with pressures to keep projects on time and on budget, project managers sometimes decide to waive the installation of some of...