Complicated procedures, long processing times, and a perceived lack of responsiveness: Public sector organizations often lack the tools needed to deal with such issues and hence do not always enjoy the best of reputations with the citizens they serve. It’s a situation Earl Lambert – Houston’s citywide chief technology officer and manager of its ERP operations – knows only too well. However, by successfully implementing SAP software, Lambert and his team have laid the groundwork to ensure that such problems are a thing of the past. For their efforts, they received the ASUG Impact Award from the Americas’ SAP Users’ Group.
Legacy system replacement
Approximately 5.54 million people live in the Greater Houston area. The city proper and its 2.14 million citizens are the fourth-largest city in the United States (behind New York, Los Angeles, and Chicago) and the largest in the state of Texas. As the leading hub of the oil and energy industry, Houston is known as the energy capital of the world. It is also the center of astronaut training in the U.S. and home to the largest seaport (based on stock turnover) in the country. Houston is also one of the few U.S. cities to operate three airports on its own, and has more theater seating than any other city in the United States except New York.
It all started when the city’s maintenance contract for its previous system expired and it became increasingly difficult to find qualified personnel to keep things running smoothly. “We’d been using the system since 1989, and it simply got too old,” recalls Lambert. “It was a major risk in our ongoing operations.”
The project team began searching for a new ERP system that would in particular handle financial administration, human resources, payroll, and materials management; with 23,000 city employees – from city clerks to firefighters and airport managers – and a budget of U.S.$3.1 billion, hardly an easy task. Though the competition was fierce, Houston opted in the end for SAP: “Functional depth and diversity made the difference,” explains Lambert.
At that point, the team got in touch with other SAP customers to learn about their experiences and to identify and avoid potential problems before they occurred. “We wanted to find out what worked for them and what didn’t,” says Lambert. “ASUG helped us get the project off the ground from the start, and the camaraderie is great.”
IT and user departments working together
SAP solutions implemented
- SAP ERP
- SAP for Public Sector
- SAP NetWeaver
- SAP Solution Manager
In May 2005, the team received the green light from Mayor Bill White, who considered the SAP project an important part of his HoustonOne modernization campaign. “The mayor has great visions of making use of technology and has initiated a very positive change,” says Richard Lewis, director of information technology and chief information officer for the city of Houston. This support proved invaluable to the team and made working with other departments much easier. “We viewed our SAP implementation not just as an IT project, but as a crucial step in the right direction,” Lewis adds.
The governance committee for the project included the city’s chief administrative officer and the heads of all its departments, who then dispatched experienced employees to form a steering committee. As a result, the 12 departments most affected by the transition – representing 98 percent of the city’s budget and administrative employees – were directly involved in the project.
“We wanted a steering committee worthy of the description,” says Lambert. This cross-departmental body made every important decision in the project, investing over 2,500 working hours in the process. “They made the commitment, took ownership, and were behind the project,” Lambert says in summary.
Added value in 22 months
The 95-person project team was responsible for the lion’s share of the work: Until the project’s go-live in March 2007, the team went through all of the relevant processes with the corresponding user departments, established workflows, and transferred them into the system. A total of 225 employees received superuser training; today, 2,800 users work with the system.
“In the course of the project, we kept coming across weaknesses that would have remained hidden in our previous environment,” says Lambert. “This enabled us to maximize the new system’s utility in a lot of areas, thanks in no small part to the dedication of our superusers.”
For example, Houston’s administrators used to enter over 25,000 transactions manually before forwarding them on for approval; they now handle these activities electronically through workflows in the SAP system. Lambert cites the following as the main benefits of the city’s SAP implementation:
- Improved financial control
- Strict reporting and real-time data evaluation
- Accelerated processes, particularly in vendor integration
“With this project, we’ve laid the foundation for continued growth and constant optimization,” Lambert says. Richard Lewis adds: “We have a first-class team and first-class people who made this success possible. It’s something we want to build on.” Lewis sees his IT department in an excellent position to keep making process improvements and to support the municipal administration of Houston. With its help, the city will be able to say: “Inefficient administration? What a silly cliché.”
ASUG Impact Awards 2008
The Americas’ SAP Users’ Group (ASUG) created this award to recognize the achievements of their members who have realized significant business results by running SAP solutions. Submissions are evaluated on demonstrated success in the following criteria: return on investment generated, strategic alignment to goals met, SAP product scope used, best practices developed, service improvements demonstrated, and the degree of innovation reflected in their approach. This year, ASUG has awarded Impact Awards in the categories of Large Enterprise, Small to Medium Enterprise, and Public Sector. SAP Spectrum portrays the three winners in this and upcoming issues.