It is 3:30 AM on a Tuesday morning as I lay in my bed looking at the ceiling, wondering what gremlins will raise their ugly heads before my district goes live with the first phase of our enterprise resource planning (ERP) implementation. Those who have had a leadership role in an ERP implementation project understand what I am talking about. For those who are about to embark on one: get plenty of sleep now.
Before getting into the details, let me introduce myself. I am the CTO of the fifth largest school district in the country (approximately 300,000 students), with a growth rate of 1,000 students per month. While my story may differ in scope with smaller districts, it does not in substance.
Our goal in buying an ERP was to integrate most of our disparate business systems into one single integrated system. As our district grew we realized that our legacy systems, while good in many respects and customized to some of our unique needs, lacked the comprehensive integration and other features found in more modern systems. So about four years ago we made the commitment to look into acquiring an ERP system. As they say, the rest is history; and here I am looking at my ceiling in the middle of the night four months before going live.
ERP: Constant Care and Feeding
Perhaps it was the hour of the night, but I couldn’t stop thinking about the cult movie classic, Little Shop of Horrors. In case you missed it, a meek clerk purchases an odd plant that he names Audrey II after his girlfriend. He eventually finds out this plant is from outer space and demands continual feeding by shouting out, “Feed me!”
In many ways implementing an ERP is very much like Audrey. When we received responses to our RFP from three major vendors, it was remarkable to see how their requirements for district staff were virtually identical and fairly reasonable. To implement the financial, human resources, and payroll modules, all three finalists estimated that 23 to 26 full-time staff members would be needed over eighteen months. They added that at times we would occasionally need to bring in a few additional people for brief periods for tasks like testing.
But soon after our school board approved our selection, the integrator said we would need an undetermined number of additional staff on the job. Feed me! And as we began to develop the blueprint for the system, our consultants and integrators told us we needed even more staff than we ever expected—52 to be exact. Feed me! Is Audrey satisfied yet? I don’t think so. Now that we are four months from going live, we have 62 full–time district staff (including both technical and functional) and 16 contracted programmers. That’s a total of 78 staff paid by the district, and I am not certain that we are finished yet.
Audrey raised her head in other areas, as well. Prior to the ERP project, the district had purchased a storage area network (a SAN) that we were going to use to support our student information system, and, once requirements were known, add capacity for the ERP. When the ERP technical consultants saw the SAN, they remarked that the SAN had sufficient storage (3.5 terabytes) for several years of ERP activities.
Of course, within six months, the ERP technical team determined they underestimated the amount of storage required and asked for an additional 3.5 terabytes. Feed me! And by the way, we needed two security people, not one; four programmers, not two. That’s not including the trainers and the change management team. Feed me!
The Good, the Bad, and the Ridiculous
Why the ERP sales teams continue to put out such ridiculously low staffing estimates is beyond me, but I can make a pretty good guess.
The reality is that you are going to need to backfill more positions, that is, hire staff to replace some of those who have been assigned to the ERP project. And it also means you have a lot of explaining to do to your superintendent, financial officer, and district content specialists that run accounting, human resources, and other functions.
The upside of all this pain: eventually your ERP project will probably be staffed the way it should have been from the beginning.
While all this extra staffing seems extraordinarily expensive, it is not as much as it seems. A great deal of my project’s extra staffing came from existing district staff, only some of which were backfilled. It has been difficult, however, for the functional areas such as accounting, purchasing, and human resources to lose manpower for several months at a time. (Of course, the services of specialized programmers and consultants must be purchased; and at $125 to $290 per hour, they are quite costly.)
There are some lessons Audrey taught me I would like to pass on. First, take whatever your software sales team or integrator says regarding the amount of staff you will need to dedicate to the project with a grain—better make it a pound—of salt. Understand that sooner or later you will need to throw more people into the fray.
Similarly, there are always unexpected expenses for more equipment, software, training, and consultants. As you set up your project plan and budget, make certain you have a healthy contingency fund available. Although it is difficult to tell you how much to put into your contingency fund, a rule of thumb that can be used for planning is that in large scale software implementation projects, the cost of implementation often ranges from four to six times more than the cost of the software.
Also, it might be a good idea not to publicize the entire amount in your ERP implementation fund. That way your project leadership may be more cautious in its spending, while at the same time you will have “extra” funds available as implementation gets closer and Audrey rears her vociferous head.
Finally, remember that Audrey does not discriminate. While staffing was a particular sore point in my situation, equipment or training may be your Achilles’ heel.
Philip J. Brody is chief technology officer/assistant superintendent of Clark County School District in Las Vegas.