Austria – A Shining Example

“We had been looking for an IT solution to help our universities with their financial planning for a long time,” explains Slovak Education Minister Martin Fronc. “In order to be able to meet the new challenges involved in running universities, we needed business management software that would help us to bring ourselves into line with new legislation. Masters and Bachelors degrees, for example, are to be standardized across Europe by 2010. With SAP, we can improve our structures and implement new organizational and financing models. This will enable us to stand up to international competition,” says Fronc.
Given their scarce resources, universities need cost-effective planning. The number of students is rising, as is the administrative workload. At the same time, competition for funding is becoming stiffer all the time, and those providing the money want to know exactly what it will be used for. As if that were not enough, universities in Europe are also required to implement the provisions of the Bologna Process by 2010. This is a higher education reform which European countries hope will create standardized educational structures so that a student from Bremen, for example, can seamlessly continue his studies in Vienna or Uppsala without having to submit his or her certificates several times over. He might then choose to complete a Bachelors or Masters degree at the University of Bratislava, for example, and this institution would also administer the tuition fees applying to him.
As well as fulfilling these new European framework conditions, universities are also supposed to be responsible for their own procurement, funding of research projects, and recruitment, promotion and pay rises for staff with effect from January 1, 2004. Faced with these new legal requirements, it seemed sensible to completely modernize all the internal administration processes in Slovakia’s universities. The universities’ management bodies and the Ministry therefore decided to implement the SAP R/3 standard across the board.
In July 2005, Siemens Business Services (SBS) and the Eastern European solutions provider Varias – a subsidiary of the multinational S&T System Integration Technology AG – commenced project work at the universities in Bratislava and Zilina. SAP is now up and running at both universities. The remaining 18 higher education institutions in the country will follow suit by the end of 2007, and SBS and Varias will then run the system for seven years.

Drawing on the Austrian experience

The experience which SBS gathered from the project in Austria is now proving extremely useful for the rollout in Slovakia. In summer 2002, the 21 universities in Austria brought in SBS to help them convert their administrative processes to SAP R/3. The implementation project comprised the SAP modules Financial Accounting (FI), Fixed-Asset Accounting (FI-AA), Funds Management (FI-FM), Controlling (CO), Project System (PS), Materials Management (MM), Sales and Distribution (SD), and SAP Business Information Warehouse (SAP BW). “When Austrian universities took control of their own economic and legal affairs, timely financial planning became essential,” says Wolfgang Mayr-Knoch, who is responsible for research and education at SBS.
Local project teams in each university adapted the master plan to suit the needs of each institution, depending on whether it specialized in humanities, natural sciences, business, medicine or art. Data was transferred from the old IT systems, and the SAP solution was linked up to existing applications. Local staff were involved in the project from the very beginning. They had to learn how to move from a governmental accounting system to double-entry bookkeeping. “The project team ran a large kickoff event to prepare the staff from all participating universities for the IT changeover,” explains Mayr-Knoch. The team also trained selected staff to act as contacts. They are the first line of inquiry for potential users who have problems or queries.

An accounting model for all

Double-entry bookkeeping
Double-entry bookkeeping

Together with consultants from SAP and IBM, the project team completed the changeover to the SAP software in 18 months. Until the end of 2003, the universities in Austria continued to manage the financial requirements relating to students, examinations, and lectures, using software, but this application did not allow any comparison of costs versus performance. On January 1, 2004, when the SAP solution went live, all the universities were required to deliver an opening balance sheet. Using the SAP R/3 standard, the universities are now capable of bringing together elements such as finance and human resources management or budgeting and funds management to form integrated processes. The relevant figures are automatically fed into the cost-performance calculations. Tuition fees and other services, such as issuing student identity cards, can be administered far more efficiently and transparently using SAP R/3-based double-entry bookkeeping. SAP BW also provides data which can be used for purposes such as planning lecture theater timetables based on the number of students enrolled.
In January 2005, the project team also integrated the SAP Human Resources module (SAP HR) at 16 of the 21 universities. Payroll and salary payment operations there are now handled electronically using this system. By May 2005, the accounting system comprised over 537,000 assets, had recorded more than 870,000 transactions, and had set up over 65,000 creditor accounts. “The data shows that the introduction of SAP R/3 has been a success. That’s largely thanks to the professional approach and commitment of the 700-plus people involved in the project” explains Austrian Education Minister Elisabeth Gehrer. “Moreover, the project also demonstrates how effectively different partners from the private and public sectors can work together.”
This positive assessment ought to reaffirm that Ms. Gehrer’s Slovak colleague Martin Fronc has made the right decision. All in all, having information in the form of automatically generated reports boosts transparency. Austria’s universities are now able to compare their costs against their performance. They can also meaningfully compare business management, engineering, and natural science courses against one another. The faculties work closely with industry here, and SAP R/3 is boosting confidence. After all, it is much easier to bid for third-party funding if the university can provide clear evidence of precisely where the money goes.

Andrea  Stercken
Andrea Stercken