€150 million down the HSE black hole.

Here's a question.

A new HR/Payroll system is most likely going to automate many existing processes. Or at least should do.

Automated processes are most likely going to reduce the numbers employed in those impacted areas.

Therefore the longer it takes to implement a system, the longer these impacted areas will need to employ people who's positions are no "at risk" of redundancy.

(Redundancy in the true sense of the word, rather than the Irish Ferries definition).

I know from past working experience that projects that are likely to impact on peoples job security are hampered and delayed intentionally to make sure people don't lose out. And that was in the private sector.

This can take the effect (as discussed above) of widening of scope requirements, changing of scope and changing requirements, delaying feedback on items, delaying of involvement in testing, general lack of "buy-in" into the project. All of which will delay a project, and up the cost.

It would be my personal opinion that this would be just as likely, possibly more likely, in a public sector area like the Health Service.
 
RainyDay said:
Is SAP payroll running anywhere else in Ireland?
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I know that SAP is part of the payroll process of one of the large financial institutions in Ireland and that they changed their processes to complement SAP, rather than shoe-horn SAP around the extant processes.

The guy on with George Hook yesterday, who incidentally played a blinder on exposing the weakness of the e-voting solution, claimed that there are more than 2500 test cases for payroll. Seems like the individual health boards existed as independent fiefdoms and that the way in which staff were graded and rewarded in one hospital was materially different to how one in another health board area was managed.

And if that is true for payroll, then it is likely to be true for all of the other processes to be administered using SAP.

It wasn't christened Angola for nothing ;) .
 
Ironically, today's Times reports that the Dept of Finance memo from this summer in addition to raising concerns about PPARS also raised concerns about a multi-million euro system being introduced in the HSE caseel FISP which is meant to control and manage costs & spending.
 
This certainly wouldn't rank as one of the great Software Runaway projects in the history of the world. But for a country our size it's a pretty impressive level of spending.

I could say with a reasonable amount of confidence that anyone who has worked in software development has seen this on a smaller scale. Software likes to be built on top of well defined and Business Processes. It is almost always a good idea to take advantage of the Automation to introduce changes to the Business Process.

This makes the Software Cheaper and easier to build, and as a bonus you get a better underlying business process. Building software on either a changing business process or a process that isn't well understood is a recipe for surprises (which usually cost lots of money and time).

Of course some Experts may take the view that it's cheaper to build a very complicated piece of software than try to overhaul a complicated business process.
Getting the Admin side of the Irish Health service into a streamlined efficient and well defined state could have taken decades, I don't know, I have no knowledge other than what's been said in the Dail. But it sounds like a hodge podge of disparate systems.

It's easy in retrospect to say that it was stupid to go ahead with the software before nailing down the business process, but we're dealing with Public Sector Employees here, in the Health Service no Less.

Getting them to Agree to changes that made them more efficient and made their lives easier would probably have cost €150M in hardship money. After it was done (in 20 years) we might have been able to build a computer system for €10m. But the overall cost would still have been €160m

Government is a lot like Private business.
Just with more 0's and it's other people's money.

-Rd
 
One in every twenty people in the workforce works in the health sector. Was there no one there who could have seen this coming?
I presume that this project had to be approved by the department of finance before it started. Is there no mechanism there that would have set off the alarm bells when the costs went through the roof?
 
There is clearly an oversight failure at a high level. I accept that the project is complex; I accept that it is proabably being implemented in an environment where there is a lot of institutional resistance to streamlining business processes. But to get to where they are, they have spent around €3,000 for each employee on the system. This just cannot be right. If you simply went through the whole organisation one employee at a time, it could hardly take more than a half day per employee. Where is the money gone?
 
I thinks Prof Drumm has the right attitude ... cut the losses before they throw any more money at it. Obviously the whole health board admin system has been on it's knees for years ... and nobody really gave a damn. Hopefully with fresh thinking at the healm something radical will be done.
 
I am not so sure I agree. If the system chosen is the wrong one for the job, then they need to abandon it. (then they need to be really brave and buy a system which works.)

However, if the payroll and HR processes within the HSE are so disparate, so localised, so riddled with exceptions and local practices that a standardised payroll system cannot successfully be implemented, then there is a larger problem. Logically, there is no reason why there shouldn't be a standardised payroll system for the entire organisation. But if the existing processes are so byzantine that they cannot easily be assimilated by any single system, then the existing processes must change.

If this is the case, then reverting to the status quo is akin to a cop-out.
 
Henny Penny said:
I thinks Prof Drumm has the right attitude ... cut the losses before they throw any more money at it.
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I'm not as certain.

The money already spent is gone and cannot be recovered. From where they are now, how much needs to be spent to get the required solution in place ? Start with Plan B from scratch and risk making the same mistakes or encountering the same obstacles already suffered, or put more money behind the current solution and make sure each cent is accounted for and justified from here on in ?

Also, get a big stick and beat (not literally) some manners into the people who have a vested interest in retaining the old ways.
 
The project mgmt accounting principle of 'sunken costs' would apply. The money that has been spent to date is irrelevant (in terms of deciding how to move forward). It's gone - it's sunk, regardless of what decision is made for the future. The only question that is relevant is how much will it cost to make the current solution workable.
 
The project mgmt accounting principle of 'sunken costs' would apply. The money that has been spent to date is irrelevant (in terms of deciding how to move forward). It's gone - it's sunk, regardless of what decision is made for the future. The only question that is relevant is how much will it cost to make the current solution workable.
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Good point that. If you take it further, D&T probably have x number of SAP developers on contract working on this. If theyre redeployed as the work is being halted (according to all and sundry), how are HSE to get them back in? More cost. A stocktake is probably required. But months of halted work will bring additional cost at project restart.
Or is the work continuing but the rollout halted?
 
They could have gone to theasurus.ie and bought their Bureau Payroll Manager for €275 plus VAT!
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...or they could have gone to www.payback.ie and only paid €99 + VAT! They also would have been able to pay their employees fortnightly :D

(I'm affiliated with payback)
 
Isn't it ironic that private companies big and small must run their businesses and keep on top of the ever changing regulatory requirements, changes to the tax system, Benefit in Kind, VAT, the Euro etc.

All things that are introduced and/or changed at the whim of government and yet somehow private business survive and adapt with little more than a budget speech as warning.

While the Government who have the power to make every business in the country jump through hoops don't seem to be able to agree on a single way of paying the workers in ONE of it's own departments.

Am I crazy for thinking this is crazy?

-Rd
 
You took the works out of my mouth Rd (but in a more articulate and concise way).
Aside from the high minimum wage and indirect taxes the cost of the huge increase in admin is a major strain on small businesses, say 2-10 people firms.

There must have been a project manager for both of the now suspended computer systems in the HSE or department of health. Either a consultant told them about the pitfalls of trying to fit SAP onto the existing system and they gave the go ahead anyway, in which case the project manager should be sacked, or the consultants said nothing, in which case their firm should be sued for the cost of the project.
Even if this is not the scenario someone must be held accountable and if the fault is with a consultancy firm then they should be held financially accountable.

If a civil engineering firm was hired to design and a bridge and another one hired to build it and the thing fell down then one or both of them would be held accountable for not doing their job properly. Why is this different?
 
I'm not an expert in this area but I think that the problem isn't necessarily SAP - SAP has been implemented in many different industries in different countries and in multi nationals without major issue.

The problem seems to have been a lack of control by the client; a consultant is nothing more than a tool; for a project of this size the client cannot abdicate responsibility completely but needs to take an active role in all levels of the project - A guy on Matt Cooper spoke a lot of sense yesterday evening on this issue.

At a guess I would imagine that there was a lack of a defined project scope, lack of proper budget reporting and oversight, a lack of proper change control mechanisms and not enough resources and time spent on getting the analysis complete before beginning any customisation or design in SAP.

The excuse put forward that this was all "very complicated" is not a valid one - it may be complex but it surely isn't / wasn't insurmountable.

The "big 4" are not having a good week are they? Deloittes getting reamed on this project and KPMG missing €2 million from NTR!!
 
efm said:
The excuse put forward that this was all "very complicated" is not a valid one - it may be complex but it surely isn't / wasn't insurmountable.
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I'd agree that this isn't a valid excuse. However, if the complexity of the business requirements were actively hidden from the consultants up front, or have been changing along the way, then this could explain the cost increases. However, one would expect formal change management processes to kick in to ensure that any increases are documented and approved by the client along the way.
 
>However, one would expect formal change management processes to kick >in to ensure that any increases are documented and approved by the >client along the way.


To be fair to everyone involved I haven't seen any evidence that this didn't happen. All we've heard is the medias hysterical ranting about 150 Million and the opposition's hysterical about 150 Million.

Neither of these groups would give a damn if a formal change process had been in place and the 150 Million was completely above board and signed off on.

There is general acceptance that the scope of the project widened dramatically. It may be that the 150 Million was justified in the context of the widening scope. Regardless of how well managed the scope change was the Opposition and the Media would have called it an out of control budget overrun.


The current suspension of the system is simply a suspension of rolling it out to further sites as far as I know. That's different to abandoning the project altogether and is completely sensible.

I'm not one to defend the Government and they have a lot to answer for when it comes to wasting money, but I'm sure as hell not going to take the word of Journalists and the Opposition and condemn this project completely.

In the only case in which I had some knowledge of the truth behind a media story the difference between the spin being put on the story by RTE in particular and the actual truth was startling. Since then I read such stories with a lot more skepticism.

-Rd
 
daltonr said:
To be fair to everyone involved I haven't seen any evidence that this didn't happen. All we've heard is the medias hysterical ranting about 150 Million and the opposition's hysterical about 150 Million.

Neither of these groups would give a damn if a formal change process had been in place and the 150 Million was completely above board and signed off on.
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That's true - a change management process isn't a panacea, as it's success depends on the judgement of the individuals who sign off such changes. One would hope that a change in scale of this nature would have raised certain alarm bells - from the press reports I've seen, the alarm bells involved getting other consultants (Hays, Garnter) to evaluate the work of the original consultants, which seems to demonstrate a lack of ownership & responsibllity.

BTW, the project website is available at [broken link removed]

It would be interesting to see the running/maintainance costs for all the different payroll systems currently in place in the health boards/hospitals.

Just found some interesting articles on the - the original articles have dissappeared off the IMT's website so you'll need to follow the Google 'cached version' link. Most of these goodies don't seem to have appeared in the mainstream press.

Based on the following figures, it looks as if a substantial amount of the project budget (nearly 50 m in 2005) has gone on salaries of the 'implementation teams' which presumably are full-time health-service employees, not external consultants.

In addition, spending has increased significantly since the end of 2004, the figures reveal.

The State has also spent:

* Euro35.1 million on salaries of local implementation teams.

* Euro12.3 million on salaries of the National Implementation Team in Sligo.

* Euro10.6 million on hardware and outsourced managed services.

* Euro10.5 million on software licenses and maintenance.

* Euro5.5 million on “other”.
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Other highlights include;


  • IT sources have told IMT that the C&AG’s figures do not represent the whole cost of software implementation and that Euro500 million is a more accurate number.
  • Support from the national level to the local level was good before the software was installed but then vanished afterward, the report found. The national project team responsible for support did not have the resources or expertise to handle support for one site while preparing another site for installation. [...]In other words, the project teams should have adequately trained a user to help other users, so that every problem did not escalate to the project team level, where it would sit until someone had time to deal with it.
  • The national steering committee responsible for overseeing PPARS did not explain the project’s purpose to the managers of the various sites where phase I implementation had been achieved, the report found. Therefore, managers felt like the project was being forced on them.
  • A month before the start date, however, the contract had to be renegotiated for a number of reasons – including Y2K issues. The original licence had been bought while there were still “commercial/legal, scoping, scheduling, agency capacity and year 2000 difficulties,” the report states.
I'm gobsmacked that anyone could have signed up to buy non-Y2K compliant software in 1998.
 
Maybe I'm taking an overly simplistic view of the whole thing, and I know an opposition TD did allude to this in the Dail, but to me the most disturbing thing is that this system/these systems don't look like they are going to have an bearing on the level/quality/efficiency of the services provided by the HSE, regardless of whether they were successfully implemented or otherwise.
 
I dont understand how staff in different health boards were on different pay and conditons than similar staff employed in the other health boards. Surely staff should have been employed on an rph basis and before benchmarking etc was agreed with the dept of health this should have been sorted out. pretty basic I would have thought, though nothing about the health service in this country is basic except the service itself.
 
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