IRELAND 19 February 2017
Special Report Number 59: Management Information Systems in the Institute of Technology Sector
Summary of Findings
As early as 1993, the concept of common management information systems for the institutes of technology had been proposed. The areas where common systems were suggested included student administration, financial management, personnel and payroll management, library administration and executive reporting. There was also a strong emphasis on integration of the individual systems in the initial proposal.
Some six years on, contracts were concluded with two main software suppliers. The Banner System was procured from Systems and Computer Technology Corporation (SCT) with the aim of providing an integrated solution to the needs of the institutes in the areas of student administration, financial management, personnel and executive information. The Millennium Library System was separately acquired from Innovative Interfaces Inc.
It became necessary in the course of the project to substitute alternative software for some of that initially purchased from SCT. Ultimately, the project involved a total of 59 separate implementations in the course of which the Banner Student System, Agresso Finance System, Core Human Resource and Payroll System and the Millennium Library System were installed in the institutes.
Procurement and Contracting
At the time the contract with SCT was concluded in 1998, it was known that there were gaps in the capability of the Banner Finance component of the software. However, it was considered that those difficulties could be overcome as SCT had indicated that it was developing a strategy to enter the European market in the course of which the gaps would be addressed. At that point, the benefits of integration, which the Banner software promised, were considered to more than outweigh the apparent gaps in capability.
However, by 2001, further reservations had arisen in relation to the Banner Finance System. A detailed gap analysis indicated that significant modifications would be required in order to make the software useable. It also emerged that SCT no longer had a strategic plan or sales plan for their finance system in Europe. The cost of modifying the software was estimated to be between ?1.3 million and ?3.8 million with at least two years being added to the timeframe for the project. Ongoing costs would also arise since most of the modifications would not be incorporated in the baseline Banner product making the future support of the system both complex and costly.
Subsequently, the suitability of the Banner Human Resource System was also called into question. As part of a comparative analysis with an alternative product, it emerged that the Banner Human Resource System only had an 18% residual fit with the institutes? requirements - after the Banner Finance System had been removed. An alternative product - Core Human Resource software was rated as having a 90% fit.
At this point, contracts had been concluded with SCT which obliged the institutes to take the deficient software. Taking account of this, new contractual arrangements were entered into. While retaining the existing contractual framework, the Agresso Finance System replaced the Banner Finance System and the Core Human Resource System was chosen to replace the Banner Human Resource System. The Core Human Resource software and Core Payroll software were subsequently implemented as an integrated package. The additional cost of acquiring replacement systems was approximately ?4.2 million.
Legal advice suggested that while there were provisions in the original contract with SCT upon which the institutes could rely in litigation, it might be preferable to seek a commercially satisfactory solution without the necessity for proceedings ? particularly, since an ongoing commercial relationship with SCT was necessary on account of other system modules and litigation would have been costly, disruptive and involve considerable delay.
As an offset against the additional cost, potential credits of ?1.39 million were negotiated with SCT in respect of the Banner Finance and Human Resource components which would reduce the net additional cost for the two substitute products, if and when those credits are fully realised to around ?2.8 million. It has been calculated that approximately 86% of the credits negotiated have been realised to date.
Governance and Management
Initially, the project was led by a Project Steering Group chaired by the Director of Tallaght Institute of Technology and comprising representatives of the Department of Education and Science (the Department), Dublin Institute of Technology (DIT) and a number of other institutes. In 2000, the Project Steering Group was replaced by a Consortium Board representing all of the institutes and the Department with an independent chairperson.
The project suffered in the initial years from inadequate project planning, resourcing difficulties, a lack of full commitment and weak governance and management structures. A risk review carried out by KPMG in February 2001 had noted significant weaknesses with regard to planning and governance. The draft report recommended that the project should be re-assessed, restructured, re-scoped and re-planned. Weaknesses were addressed through the adoption of a revised plan in mid-2001, the use of consultants and contractors and an evolution in appropriate governance and management structures starting with the appointment of an independent chairperson to the Consortium Board in May 2000.
The total cost incurred in implementing the systems was approximately ?58.42 million. Costs were incurred both at a central level through the central services unit established to manage the project and at a local level by each of the institutes. Total project expenditure exceeded budget by approximately ?5.7 million.
The target completion date set for the revised project in 2002 was December 2004. This target was achieved with the exception of two implementations which were completed in 2005.
Challenges still exist particularly in the areas of integration/interfacing, reporting, modularisation and semesterisation, web-enabled and self-service facilities and in aligning staffing structures with the new technology. This was borne out in a survey which assessed the extent of user satisfaction with the implemented systems.
To cater for the further development and ongoing implementation and support of the systems, a limited company, An Chéim Computer Services Limited, (An Chéim) has been established as a subsidiary of DIT. Its Board of Directors is made up of representatives of the institutes, DIT and the Department.
A key challenge for An Chéim will be to ensure that the necessary procedures and expertise are in place to underpin the ongoing support and development of the systems. This includes engaging with institutes in relation to their needs, providing leadership and support in the realisation of system benefits - particularly in the area of reporting, maintaining tight control over the outsourced systems hosting contract and providing training for users.
The original project planning was not commensurate with the scale of the work to be undertaken. As a result, unrealistic cost projections and timescales were formulated.
The inadequate planning in the initial years allied to deficiencies in governance and management of the project led to a delay in getting the project off the ground.
However, following mid-course adjustments including substitution of software, the development of a well thought out plan and improvements in governance structures, the project was effectively delivered.
The project has been successful in implementing a standard system covering the main administrative functions of the institute of technology sector. This was no mean achievement given the autonomous status of the institutes.
An initial focus on integration and on securing a ?best fit? solution to the priority need for a student system may have led to a sub-optimal choice in regard to the finance and human resource components.
Confronted with the difficulties which the institutes faced however, the decision to move away from the concept of integration of a family of products was a good one. It is generally agreed that the substituted products have provided the institutes with a much better fit in terms of functional requirements. At this point, all institutes, with the exception of DIT, have common software adapted to a common standard design hosted in a single centre and all updated to the latest release.
Unfortunately, by the time revised terms were concluded with SCT, much of the consideration in the original agreement had already been discharged. In addition, legal advice indicated that proceedings against the supplier for contract breaches would be problematic.
In the event, the credits of ?1.39 million negotiated with SCT represented just 15% of the initial contract value despite the fact that two of the three major systems (Finance and HR) as well as a number of additional components purchased were not implemented. Since the initial agreement with SCT did not detail the cost of the individual components of the procurement, it is not possible to relate credits negotiated to the cost of individual software elements that were not provided. Because of this, the precise extent of the nugatory expenditure that occurred is difficult to determine. However, it is likely to have been considerable.
On a wider canvas, important lessons which emerge are
- the importance of promptly changing course when initially proposed solutions do not meet the needs of organisations
- the acquisition of ?best of breed? software combined with compatible interfaces, interoperability frameworks and data warehousing may often be the appropriate approach when addressing IT integration issues in major procurements.