news The Northern Territory Government has decided to dump its broken Asset Management System (AMS) developed by Fujitsu and based on SAP software, after receiving independent advice that it would cost an additional $120 million and five years to fix.
The AMS was first announced in August 2009. At the time, Japanese diversified technology group Fujitsu said the platform was enable the Northern Territory to better manage the state’s assets, including $11 billion in Government resources ranging from houses to highways. The company was to assemble a team based in Darwin to build the asset management system using SAP and ESRI software packages.
However, the project went off the rails over the years since, leading the Territorial Government’s Auditor-General to heavily criticise it in March 2013. NT Deputy Chief Minister and Minister for Corporate and Information Services David Tollner delivered an extraordinary and prolonged angry speech regarding the project in December in Parliament, describing it as a “diabolical mess” and the situation as a “scandal of epic proportions”.
In a statement released today, Tollner said the “former Labor Government’s AMS had been an abject failure”. “The system was originally supposed to cost $7.2 million but will cost the taxpayers of the Northern Territory $70 million. Yet the system is fundamentally broken. It simply does not work,” Tollner said.
Independent asset management systems experts from KPMG were engaged to undertake a review of the failed system and provide government with options for a functioning alternative system. KPMG found that the AMS didn’t meet the Government’s needs and was so fundamentally flawed that remedying the system was simply not feasible. The KPMG review reinforces the earlier findings by the Department of Treasury and Finance, which identified the AMS to be only 11 per cent fit-for-purpose.
Tollner said rectifying the situation using the existing software would require it to be effectively rebuilt from scratch.
“KPMG estimate this would cost taxpayers a further $120 million and take five years to complete. We will not be taking the approach of throwing good money after bad. This fiasco strands as a monument to the former Labor Government’s incompetence. Labor is responsible for squandering $70 million on a system that simply doesn’t work.”
“The $70 million Labor wasted could have been directed to additional teachers, better health facilities or more police. Instead we have a junk system that not only doesn’t work, but can’t even be fixed,” Tollner said.
To replace the catastrophic AMS, the Government will establish a network existing asset systems call ASNET. ASNET will be delivered through updating and re-using a number of component systems that still exist within government because of the failure of the AMS.
The new solution will incorporate three of the following existing systems: The Asset Information System (AIS); The Roads Information Management System (RIMS); and the Building Asset Management System (BAMS). A technical review has found these systems to be robust, reliable and up-to-date, according to Tollner. The ASNET approach will deliver a cost-effective and fit-for-purpose solution by using contemporary software to integrate the various components through a new web- based portal.
Tollner said ASNET also represents to opportunity to engage the local IT sector in the project. “One of the many failings of the AMS was its reliance on high-end software specialists that were not available in the NT. We literally had to fly a technician from interstate every time something went wrong with the AMS,” the Minister said. “With ASNET there will be vastly more opportunities for local suppliers, many of them small ICT businesses.”
The Government has also strengthened its management of ICT projects to ensure the AMS debacle is not repeated, according to the Minister.
“The single most critical thing is to put into place a stronger, more robust governance approach and get the right senior people within Government participating in it. If we get this layer right, other factors such as project scope, resourcing and contract management can be properly addressed through an effective governance process,” Tollner said.
Delimiter will add any statement received by Fujitsu and/or SAP about this matter into this article.
The news comes as major ERP project implementations throughout Australia’s State Governments continue to suffer extensive issues and failures. The most notable of these has been Queensland Health’s payroll systems upgrade, which has cost about $1.2 billion and resulted in tens of thousands of medical staff in the state going without pay or being overpaid. The system — which was implemented by IBM and the State Government based on SAP software — still does not function correctly. The debacle resulted in IBM being banned from further contracts with the Queensland Government.
Similarly, in November 2011, Victoria’s Ombudsman handed down one of the most damning assessments of public sector IT project governance in Australia’s history, noting total cost over-runs of $1.44 billion, extensive delays and a general failure to actually deliver on stated aims in 10 major IT projects carried out by the state over the preceding half-decade.
The ongoing failure of one of those projects in Victoria Police was last month partially blamed for an 11-year-old boy’s death in Victoria. At the time, Victoria Police said its ailing IT systems failed to provide officers with sufficient information to apprehend an offender in a timely manner.
A failed Australian state government ERP project based on on-premises software from a major enterprise vendor? Say it ain’t so. Seriously, folks, we’ve seen dozens of these failures in Australia over the past half-decade, and I suspect we will see dozens more. If I’ve said it once, I’ve said it a thousand times: The fundamental model of government IT project and service delivery in Australia’s State Governments is broken in a systemic manner. At this point, Australia’s states, and now, it appears, our territories, cannot deliver major IT projects, and cannot deliver IT services well. This is a broken model and drastic action needs to be taken to fix it.