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ERP Implementation as an Agent of Organizational Change
Stephen Lightcap VP Finance & Admin., Cabrini College
Michael Scheuermann Sr. Consultant, Drexel University
May 2004
Agenda
• Project description– Drexel implementing Banner at Cabrini
• Background on each institution• Foundation for project
– initial relationship — IT support
• Challenges to implementation project• ERP as organizational change agent• Lessons learned• Future directions
S
Project Description
• Drexel University in ASP capacity, implementing SCT Banner at Cabrini College
• CMDS would no longer be supported– need to change and make significant investment
• Cabrini interested in expanding and enhancing administrative and support services to students– on-line registration
– financial statements
– reviewing transcripts, etc.S
Project Description (cont.)
• Maintain niche culture while providing e-services expected by parents and students
• Commitment to providing related infrastructure to support access to services—wireless, desktop access, robust and secure network.
S
Cabrini College
• Liberal arts & sciences—2100 students, religious affiliation, former women’s college, now co-ed, established in 1957
• 68 full-time faculty-150 adjunct faculty-147 staff & admin-48 outsourced personnel—IT staff of 5
• CMDS (Jenzabar)/ ADP / Raiser’s Edge / SIRSI in library
• Some home-grown Web tools to access directory, room reservations
S
Drexel University
• Private institution founded in 1891• First microcomputer requirement in nation
– Begun as Macintosh-only program in ’83– Platform selection made “open choice” in ’97
• Major wired upgrade from ’98 – ‘00• Wireless Initiative started in late 1997
– Library and student center were pilot projects– Entire campus by Fall 2000
• Provide I-2 connectivity to other institutions• Provide IT services (ASP) for MCP Hahnemann
University & other colleges – DUCOM M&A 7/02
Initial Relationship “Phase I”
• Drexel CIO and Cabrini President prior working relationship
• Drexel asked to provide temporary IT leadership and assist in strategic plan
• Six month relationship– staff changes, – assistance with infrastructure, – introduced WebCT, – solving computer lab issues, – developing policies and documenting procedures
• From “Trust” to development of formal, contractual relationship
• Reorganize support services, use technology to provide support
• Recommendations for future S
Expanded Relationship “Phase II”
• Discussion about admin services, business processes, what to do after CMDS
• Cabrini—desire to use top tier ERP—cost prohibitive
• Discussions with vendor—proposed an ASP model with benefits to all
• Developed plan to implement Banner system at Cabrini
S
Cabrini Context
• Drexel assist in development of RFP to replace core admin. system
• Concerns re: partner’s access to strategic information
• IT staffing requirements of stand-alone system
• Desire to further strategic partnership with Drexel
• IT not core function @ Cabrini…why do it ourselves?
S
HE Environment - Limits Vendor and Institutional Solutions
Comprehensive Research Universities
Other 4 year Collegesand Universities
Community Colleges and 2 year institutions
Total
93 62
968 440Trade Schools
1,563 1,972
504 1,470
Number of U.S. Institutions of Higher Education By Segment
Public Private
HE Environment –Limits Vendor and Institutional Solutions
• Lack of experienced IT Leadership– One year of experience ten times– No developed IT strategy
• Technical skills often limited– Dependence on products one knows– Risk not a criteria in product “choice”
• Lack of resources– Short life cycle for technology demands continual
renewal and cost– Competing institutional priorities
• IT Fragility
Small School Context
• Limited resources to procure and staff
• Limited opportunities for IT staff professional growth
• Limited mobility opportunities
• Recruitment and retention challenges for IT staff
• Supervisory challenges in an Academic-Centered environment
• Cultural Myopia
• Knuckleheads
S
Institutional Challenges
• Provide IT solutions to critical business and academic needs 24x7
• Optimize scarce resources to provide – Robust server and network infrastructure– Timely business and academic applications
– Professional skills and support structure • Develop & document policies and procedures• Facilitate productivity – utilize Web, email
Vendor Challenge
• Optimize “feet on the street”• Leverage investment in current applications
– Time is the enemy (3 years is only 6 months in Internet time)
• Expand use of applications to other institutions• Reinforce the ASP model as a solution to
academic and business challenges• Promote virtual services are a “click” away
Institutional Choices
• Self develop
• Best of breed
• Single vendor
• Outsource staffing of in-house facilities
• Consortium – Just doesn't work!
• Managed service provider / Co-location
• Application Service Provider (ASP)
• Readiness meetings—demo Banner, promote idea at Cabrini, get buy-in at all levels—
• Chance for Cabrini to differentiate itself from peer schools.
• Attract new markets—quality students
• Operate more effectively and efficiently
• Manage operations with sound reliable information basis
Implementation Plan and Schedule
S
• Student system—undergraduate admissions
• Finance
• HR
• Financial Aid
• Training, mentoring and support plan
Implementation Plan and Schedule (cont.)
S
• Billing processes and workflow
• Chart of Accounts
• Financial Aid distribution
• Managing variety of admissions schedules
Implementation Plan and Schedule (cont.)
S
Non-Technical Issues
• Work related communication and collaboration among functional staff
• No regular “work” meetings
• Staff used to ad hoc ways of recording transactions
• Skill deficiencies among some revealed when tasked with using the system
• Transition / turnover
S
Challenges to Drexel
• Get more involved to make it work or follow plan and risk project failure (not an option)
• Time commitment
• Doing the work—rather than teaching and supporting which was the plan
• Cost of support
• D.U. task orientation
• Business continuity plan
Challenges to Cabrini
• Rationalize outsourced staff
• Fear of losing control
• Cultural differences – Small vs. Large
• Communication styles – written/spoken vs. e-mail
• CC process orientation
• Change management
• Business Process Reengineering
• Managing Expectations (failure not an option)
• Human Resources
S
Application Service Providers
• ASPs are simply companies that provide access to applications over the Internet
• Outsourcing switches from assets to access. By 2010, the market share of IT utility providers will be within 29% of the total IT services market – (Gartner Group)
• Companies will in the future buy their information technologies as services provided over the Internet rather than owning their own hardware and software – (Your Next IT Strategy; Hagel and Brown; HBR 10/01)
Why Drexel as a Provider?
• Trusted technology provider in HE market• Higher Education “full service” ASP today• First to market – regional flagship focus• Four years of proven success • Other schools participating – concept works• Leadership and skills• Entrepreneurial environment• Infrastructure in place• Vendor relationships• Proximity
Example: Phase I Progress at Cabrini
• IT leadership and staffing in place• Advisory structure in place• Help desk in place• Email and Web-mail in place
– Virus protection standardized and controlled– 100 MB mail per mail box
S
Services Improved
• Course development in WebCT in place ― 40 courses developed in 6 months
• Connection to internet quadrupled• Wireless operational throughout campus• Web site hosting available • CabriniOne ~ portal• Server elimination begun• Proxy Server in place for off-campus library
access
Totally Replaced ERP System
• IT policies, procedures, documentation and standards dramatically improved
• Substantial savings on new PC purchases• Transition to SCT Banner administrative
applications– 8 month time period– July 2003 implementation– Hosted at Drexel
S
Schools are Leveraging Drexel Assets
• IT staffing• Operational staffing• Software and business applications• Hardware and network• Via:
– specialists– internal consultants / shadowing– ASP services – External relationships
• Lowering IT costs
“We don’t do things that way”- Business Process Re-engineering -
• How to know what to change and why
• Does the software drive the organization?
• How to improve business practices without compromising “culture”
• Top level support key to success
S
Schools are Also Receiving Unintended Benefits
• Business process changes – best practices
• Cultural changes
• Increased accountability
• Cost avoidance (avoiding bad decisions)
• Increased sense of urgency
• Improved competitiveness
• Strategic cooperation vs. “vendor relationship”
S
Lessons Learned
• Don’t discount cultural differences between institutions
• Turnover must be expected and creates opportunities
• Communicate clearly and regularly with the affected community
• Consider project management tools• Understand process orientation and leverage
to maximize linear implementation schedule
S
Schools are Developing New Metrics
• Importance of quality and effectiveness of service
• Evaluating performance vs. peers rather than internal performance
• Recognizing the capability of access vs. owning assets
• Refocusing on academic core mission
Current Status and Phase II
• Banner basic functionality fully implemented• BPR ongoing• Adopt standard administrative processes/
forms/etc. of ASP provider• Retain academic autonomy• Mentoring CC staff by Drexel functional users• C-BUG• Best practices cuts both ways
S
New Directions for Each Institution
• Drexel—new partners, new initiatives• Cabrini – Phase III:
– Collaborative purchasing beyond IT & ASP– Best practices– Leverage Banner capabilities as users gain
experience– Share experiences with others