Council's struggling £30m SAP shared services scheme becomes political football

A troubled £30 million SAP-based shared services scheme in the West Country has become a political football in the run up to next week’s Euro elections.

The SAP roll out is part of a larger transformation programme being managed by Southwest One, a joint venture partnership between Somerset County Council, IBM, Avon and Somerset police and Taunton Deane Borough Council.

Southwest One went live with the first phase of SAP, a procurement module, on 1 April 2009, three months later than its planned. However, the roll out was plagued with problems that led to delays paying supplier invoices.

The local newspaper, This Is Somerset, reported that "hundreds of computer experts" are trying to fix glitches, to get the system running, while Somerset County Council described the issues as "teething problems", and said significant progress had made to resolve them.

In a letter to staff last week, council chief Alan Jones said: "We are continuing to reduce the number of invoices in the system waiting to be paid. The calls from suppliers chasing payment should begin to tail off shortly."

The letter also stated that the glitches will further delay the phase two roll out of additional SAP modules, including human resources, payroll, customer record management and a portal, which were originally planned to go live on 1 June.

The council said the delays would not add to overall costs. "We have a fixed price contract with IBM and I don't think there is any cost to the council, other than not having it in to start saving more money," Sam Crabb, Liberal Democrat councillor responsible for strategic finance and resources at Somerset County Council, told This Is Somerset.

The council expects SAP to give £14 million in efficiency savings, plus a further £150 million savings in procurement, over the ten year project lifecycle.

But the Conservative party, which has long-criticised the Southwest One project, has questioned the secrecy of the project, and the costs involved.

Somerset Conservative leader Ken Maddock said Southwest One and Somerset County Council has operated a culture of secrecy. "I want to know who are the casualties, and who is going to pay for these delays?" Maddock cited examples of small local businesses and suppliers that have been impacted by late payments.

Maddock also said: "When the SAP system failed, they would have switched to a manual system, what are the costs of that?"

An IBM spokesperson said IBM does not discuss client specifics.

Copyright © 2009 IDG Communications, Inc.

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