Indianapolis launches $16M ERP project

Focus on technical simplicity will be key to project success, city IT officials say

The city of Indianapolis and Marion County have embarked on a $16 million technology overhaul designed to improve business processes, standardize technology and drive down costs.

Under the planned three-year effort, the city will replace its ancient mainframe-based backoffice systems with technology based on Oracle Corp.'s PeopleSoft enterprise resource planning suite.

Several similar efforts by other state and local governments have failed in dramatic fashion over the past few years, but Indianapolis IT officials are hopeful they can pull it off successfully by keeping the project focused tightly on business process improvements rather than technological ones.

"We are going to focus on business transformation and not the implementation of technology," said Glen Baker, the city's CIO. "We are committed to implementing the products as vanilla as we can" to minimize technical complexity, he said. "We have as much opportunity as we need to modify them later."

Much of the impetus for the ERP project stems from the need for the city to consolidate and modernize its antiquated and increasingly inadequate 30-year-old mainframe-based IT environment, Baker said.

Though Indianapolis and Marion County governments have been functioning as a consolidated entity since 1970, they maintain separate systems for crucial backoffice functions such as payroll, human resources and order management. Over the years, hundreds of "shadow systems," based on technologies such as Microsoft Access and Excel, have sprung up around the legacy mainframe environment to support these backoffice administrative functions, Baker said.

Under the project announced this week, all of these systems will be eventually consolidated into one ERP system that will manage financial accounting, procurement, human resources and payroll applications using a common data repository. If everything works according to plan, the project will yield significantly improved business processes, greater data availability and long-term technology cost savings.

Indianapolis-Marion County has chosen a relatively small New York-based systems integrator, Zannet Inc., to help implement the technology. According to Baker, one of the reasons why Zanett was chosen was because it has a big consulting presence in central Indiana and has the ability to bring a strong pool of local talent to the project.

The city's project is similar to many that have been launched by local and state governments over the past several years and for the same sort of reasons. While some have been successful, many others have not. Only last week, California's Marin County filed a lawsuit against Deloitte Consulting LLP for $30 million over what it claimed was a botched SAP implementation. In its lawsuit, the county claimed that Deloitte had failed to deliver on promises and had implemented a system that was worse than the legacy environment it was designed to replace.

Another example is Philadelphia , which four years ago had to scrap an ambitious Oracle ERP project after spending $18 million on it. The project was supposed to have helped the city replace its water billing, collections and operations processes but instead got bogged down because of technical complexity and what the city claimed was vendor inexperience. In 2008, the city of San Diego similarly terminated a contract with service provider Axon over a similarly failed SAP implementation effort.

Aaron Hood, chief financial officer of the Indianapolis Information Services Agency, said the city has taken several measures to mitigate the changes of its ERP project ending the same way. City planners for instance, have sunk a significant amount of time defining project requirements so that their technology vendors have a clear idea of what they need to do. The city has come up with a list of close to 5,000 business requirements for the project, according to Hood.

Indianapolis-Marion County has also taken several steps to make sure that it can manage the change that will result from the ERP implementation. A change management team representing all stakeholders across the city and county has been put in place, Hood said. The city is using expert advice and best practices from the Government Finance Officers Association to help guide its change management processes, Hood said. It's also tapping experts from Oracle and Zanett to help train internal staff on the new technologies. Change management is of special significance because many of those who sponsored the project are elected county government officials who could get replaced by voters, he said.

In addition, implementation has been broken up into multiple small modules, with aggressive deadlines attached to each of them, to make the effort more manageable, Hood said.

The big focus though will be on keeping the project as technically straightforward as possible, Hood said. "We don't want the software to be the driver," of the effort.

Jaikumar Vijayan covers data security and privacy issues, financial services security, business intelligence and e-voting for Computerworld. Follow Jaikumar on Twitter at @jaivijayan or subscribe to Jaikumar's RSS feed . His e-mail address is .

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Copyright © 2010 IDG Communications, Inc.

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