NSW Education’s HR/finance overhaul goes south


news New South Wales’s state government auditor-general revealed yesterday that a massive SAP-based project to replace finance, HR, payroll and student administration systems across the public education sector had gone off the rails.

The project, known as the Learning Management and Business Reform (LMBR) program was initially kicked off in 2006 and aimed to replace the systems at schools, TAFE institutions and the Department of Education and Communities’ head and branch offices throughout the succeeding seven years through to the middle of 2013.

However, in an audit report published yesterday (PDF), NSW Auditor-General Peter Achterstraat noted that the project had been delayed, had gone over budget, and had not provided all of the expected benefits to the department in some places where it had been implemented.

The finance aspect of the systems overhaul was slated to hit the department (including schools and TAFEs) from November 2009 through the end of 2010. However, in every instance it was delayed, and the deployment to schools had been prepared, but not carried out yet. The HR and payroll aspects of the project had similarly not been deployed, despite the fact that it was slated to be in place by mid-2011, and the student administration system overhaul was also delayed.

“In 2011, the department reviewed the status of the project to ensure it was a solution that met current and future business requirements,” the auditor’s report stated. “As a result, the implementation dates for the majority of components were realigned to provide an integrated solution for the department.” The Australian has reported that consortiums led by Accenture and IBM are vying to build that integrated solution.

Where the project had been implemented, the process had not gone that well.

“The finance system did not fully meet the department’s needs and users had to build some manual workarounds, which resulted in lost time and additional effort and costs not included in the original business case,” the report stated.

“System users had some difficulty obtaining accurate and/or relevant and timely information; the Shared Services Centre did not have the required skills, resources and knowledge to fully support the system; system users did not have sufficient knowledge of the new system and its functionality.”

As a result, the cost of the first phase of the project had jumped from $153 million to $210 million, although the estimated cost of the second phase had actually dropped — from $218 million to $176 million. A further $14.4 million has also been allocated by the NSW Treasury to fund additional staff and training. “This reflects the decision to deliver an integrated solution across the Department rather than separate implementations for finance, human resources and student administration and learning management,” the report noted.

In a separate statement (PDF), Achterstraat noted he was concerned that “another large government IT project is failing to deliver, is over budget and is behind schedule”.

With virtually every major IT project of any kind in the Victorian and Queensland State Governments going off the rails within the past half-decade, it is hardly a surprise to find that similar problems are being experienced in New South Wales. In fact, I would count it a surprise to find a major IT project in any state government at the moment which was 100 percent on track and on budget; now that would be worth writing about.

However, leadership around this issue has started to arise, as Australia’s IT community starts to deal with the long-term fallout of such dysfunctional government IT projects. Last week we looked at some of the things Victoria shouldn’t do in order to pull itself out of the IT governance hole it’s currently in; we’re currently working on an article looking at what it could do. Some of these lessons will apply to the NSW and Queensland Governments as well; stay tuned for its publication shortly.

Image credit: Natalie Singh, royalty free


  1. I can advise through a credible source that another implementation at a Fed agency finance department had totally made a mess of the finance systems and Accenture is also the “partner” involved in the project. It seems that Accenture’s bag of tricks include getting senior managers in the department to sign off on deliverables without doing due diligence with their sub-ordinates who really know what’s going on. The net result is an initially bad implementation that was signed off, then the fixes come through to correct the mess as maintenance. The Australian tax payer paying for it all the way into the pockets of Accenture. Accenture are the leeches taking advantage of rather incompetent and negligent management.

    Two wrongs do not make a right, it just makes an auditor general’s report.

  2. Big project fail all the time. Construction and IT as well as any other functional area. But those projects with an IT component can be the worse because everyone insists on fussing with everything whereas in a construction project you don’t keep changing paint colors or repainting over and over. You pick and do it but IT and its configurable systems drives people to do stupid things.

Comments are closed.