Your ERP Can't Do It All
April 5, 2018 – OpenGov
The rise of the data-driven government
It’s been 25 years since the Government Performance and Results Act of 1993 was passed. This greatly contributed to the role of data and information in government, and by the late 1990s, the first public sector Enterprise Resource Planning (ERP) systems were implemented. Since then, the ERP has become the foundation of many government’s IT infrastructure. Integrating accounting data, purchase orders, payroll, and more, it provides a centralized data and applications warehouse for organizations of every size.
As data, digitization, and IT consolidation permeate every corner of government, the role of the ERP has expanded greatly. Once relegated to accounting and finance, ERPs now bundle in highly specialized functionality such as budgeting, performance management, and project management. These are a far cry from double-entry accounting, for which they are very well designed.
Rethinking the “one-stop-shop”
To meet increasing citizen demand for services, responsiveness, and transparency, governments are re-evaluating the role of the ERP in their organizations. As these systems show their age and governments strive to overcome silos of data and processes, IT leaders are looking for alternatives. They must balance the growing need for “big data” and advanced analytics, with tighter budgets, faster deployment timelines, and growing security concerns.
The rapid adoption of cloud computing and the Software-as-a-Service (SaaS) delivery model offers much promise, and have transformed the way governments procure, deploy, and use technology. At the same time, on-premise ERP implementations have become costly, multi-year affairs that require a high degree of customization. Many IT leaders now question that original vision of a single, giant system to “do it all.” Instead, a “best-of-breed” approach that augments a centralized ERP enables agencies to leverage specialized solutions as a part of their integrated infrastructure.
What if you could have it both ways?
NASCIO’s State CIO Top Ten Policy and Technology Priorities for 2018 reveals an interesting paradox: governments are simultaneously embracing cloud services (#2) alongside IT consolidation (#3). What may seem like a contradiction is, in fact, evidence of a new “hybrid” enterprise technology model. Integrating centralized, secure data centers with cloud-based solutions can lower the total cost of ownership, provide highly specialized solutions for end users, and reduce the burden on busy IT teams. As demonstrated by the recent purchase of Mulesoft by SalesForce, there is great interest in unlocking legacy data while migrating to the cloud.
Imagine being able to maintain control of core services and secure highly sensitive data, while providing solutions that meet the diverse needs of users across your organization? That’s the direction we’re headed, which bodes well for technology teams and end users alike.
Defining the role of your ERP
Governments should apply a consistent model for choosing which data and applications are handled by an ERP, and which are not. Since no single platform will be able to support every government use case, designating “core” ERP functionality is key to long-term success. ERPs are well equipped to capture financial transactions, conduct close management, define your chart of accounts (COA) and house sensitive accounting, HR, and other core business data.
When asked to handle complex business processes and specialized public sector workflows, these systems reveal their limitations quickly. Areas in which IT leaders should look to ERP alternatives include:
- Collaborative budgeting and planning
- Workforce planning
- Self-service reporting and analytics
- Performance management
- External data publishing and citizen engagement
ERPs were not designed to perform these functions. Would you rather struggle with your ERP or find the right solution for the job?
Prioritizing citizen services
There is no question that the ERP plays an important role in government. As the public sector faces increasingly constrained budgets and a growing need for investments in public health, infrastructure, education, and cybersecurity, prioritizing IT investments is critical.
Government IT leaders can choose modern, cloud-based solutions designed around collaboration, ease of use, and continuous improvement. They should look for vendors that understand the unique needs of the public sector, supplement software with expert services, value speedy deployments, and embrace an “integrations first” mindset. This strategy will complement any core infrastructure, and provide value to end users who provide critical public services.