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Some ERP in Government Failure Anecdotes

 

July 31, 2012

Doug Hadden, VP Products

I’ve been reporting here on some major ERP failures in the public sector. I mentioned in the last entry about cost overruns in the US Department of Defense that this lack of success by major ERP vendors is an “open secret”. We don’t consider the FreeBalance Accountability Suite to be “Enterprise Resource Planning” because we don’t provide software to “enterprises” – the private sector nor do we provide software to more than one vertical market. (By definition, we sell to 3 sub-verticals: national government, sub-national government, international projects.)

My sense is that only a small portion of ERP failures leak out to the press. Some because of audits. Some because of lawsuits. Over the course of the past few years, I’ve heard some very interesting comments that I’d like to share.

  • Salesperson from major ERP vendor admitted to 50% success rate in government
  • IT professional in central government agreed that ERP is too complicated with a high cost even though the government was pushing to implement more ERP
  • ERP software enabled “overspending the vote” – exceeding the budget
  • Major ERP vendor in use by at least 2 national governments for accounting – but not budget controls (which is why one buys financial software for government)
  • Country implements major ERP vendor product, first phase, in 2.5 years. (Neighboring county implements FreeBalance, first phase, in 1 month.)
  • Senior member of government audit organization admits that the ERP implementation has sapped the government
  • Former consultant admits to problems trying to implement major ERP vendor product at sub-national level in G7 country as overwhelming
  • Another sub-national government in G7 country spending millions of dollars every year for consultant to maintain system
  • Developing nation government has been attempting to implement major ERP vendor product – for 13 years
  • National ERP shared service for G7 country now more than 6 years in the making with 20-35% cost overruns and more than 1 year late
  • Presentation in conference by government attempting to implement ERP in government begins with “normally you hear what went right at these conferences…”
  • At another conference, government presenter speaking of an on-going ERP in government implementation had nothing to say when it was suggested that the project was a failure. [This conference was sponsored by the very same vendor. I was asked during a full session what my thoughts were. I was as diplomatic as I could be. Later, one of the vendor representatives commented to me that there was enough “room” for many vendors. I suppose some governments can afford the luxury of cost overruns and high cost of ownership.]
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Doug Hadden

Doug Hadden

Executive Vice President, Innovation at FreeBalance
Doug is responsible for identifying new global markets, new technologies and trends, and new and enhanced internal processes. Doug leads a cross-functional international team that is responsible for developing product prototypes and innovative go-to-market strategies.

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