UK county council misses deadline for £7.3M RISE with SAP system launch

Gloucestershire reluctant to set new date in S/4HANA migration saga

The UK's Gloucestershire County Council has failed to introduce its new £7.3 million ($9.3 million) cloud-based SAP system in time for the new financial year, as its director of finance promised back in January.

The West England local authority had signed up to the German software giant's flagship RISE with SAP program, designed to lift, shift, and "transform" customers from on-prem legacy software to a cloud-based iteration of its latest S/4HANA ERP system.

It had aimed to go live on March 4, but pushed back the deadline to the beginning of the financial year, which arrived on April 6. This week, the council admitted it had missed its second deadline for going live, with no new date for the introduction of the software as it was conducting a review of the implementation.

A Gloucestershire County Council spokesperson said: "All ERP migrations are complex and need to be well planned and it is important that we continue to follow good practice and keep the programme under review to ensure that both technical and people changes are delivered effectively, ensuring that there is minimum disruption to the services that we offer."

The council had made significant progress with the technical build, they said. "As we move more towards user testing and implementation we are continuing to review the later phases of our programme plans and timeline to ensure that ultimately we have a system that meets the council's requirements."

The ERP project included procurement modules affected by the new Procurement Act 2023, which is prompting the council to review its requirements, it said.

Council taxpayers will no doubt rest easy that the technical build has made "significant progress" at the time it was supposed to go live. But it raises questions about why in January, with technical build continuing and user testing and implementation still to come, the director of finance, Paul Blacker, felt able to assure the Audit and Governance Committee [PDF] that the council's new SAP System "would be in place for the new financial year," which started on April 6.

It might prove a regrettable choice for the council, as Blacker provided the assurance in response to issues raised by independent auditors Grant Thornton. Their report identified segregation of duties access issues that would not be resolved until the new software arrived.

Blacker had already told the council that the system would go live on March 4, according to the minutes [PDF] of an Audit and Governance Committee held in September 2023.

Nonetheless, the council promised taxpayers that it has so far avoided extra costs. In June 2021, it said delays to its efforts to replace its existing SAP system – first implemented in 2007 – beyond December 2023 would incur an £0.5 million cost [PDF] in keeping SAP servers running. The Register understands that officers believe they have not incurred the additional costs at this stage owing "to progress on our wider programme of hosting core systems combined with use of extended support for the SAP servers." It has, however, incurred smaller costs.

While Gloucestershire struggles to migrate from one SAP system to another – albeit with a considerable business transformation in the middle – other local authorities are also challenged by different migration plans. Birmingham City Council has seen expected costs on its SAP-to-Oracle migration mushroom from around £20 million to around £130 million, while Surrey County Council saw its migration from SAP to Unit4 delayed, accrue additional costs, and ultimately cause disruption to pay.

The City of London has just signed up to move from an ERP estate, which includes Oracle, to an SAP system. We'll be watching to see if they fare any better. ®

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