The City of Ottawa’s IT department was left with several redundant systems after 12 municipalities in Eastern Ontario merged to form one city in 2001.
It was apparent from the get-go that the City had to shed these technological saddlebags in order to save money. It embarked on a $40-million information infrastructure overhaul to unite all the systems onto one platform and centralize all the City’s data. Now, in early 2005, the project has finally been completed.
City Council trembled when it doled out the cash for the project, according to Greg Geddes, chief corporate services officer at the City. But despite the huge cost, he said, Council knew it had to be done. In return, the City’s IT team promised $80 million in savings per year through internal efficiencies, establishing a new municipal structure and organizational framework to deliver services consistently to its employees and citizens. The IT team also pledged an $8-million ROI in operational benefits.
With 12 different programs or more for each business process, such as payroll management and taxation, the City needed to be standardized on one information infrastructure platform to be more efficient and reduce redundancy, which was costing the City money, Geddes said.
In situations where all of the former municipalities were using the same system, as in the case of the tax system, the City left them be. But in other cases, integration was critical. For example, there were 16 different payroll systems across the region; the City was running PeopleSoft for payroll and SAP AG for financials and was having to reconcile data between the two systems. In fact, the City was using a hodge-podge of software including products from PeopleSoft Inc., Oracle Corp. and SAP AG, as well as a number of smaller systems, for payroll, maintenance management, property management and financial management.
But the City finally settled on SAP because it had already made a significant investment in the platform; there was an existing install at the former City of Ottawa and the former Regional Municipality of Ottawa-Carleton, the two largest infrastructures of the 12 municipalities.
“We wanted to make sure we had a system that could integrate all our components,” Geddes explained. “With things like property management, as far as I know it is not offered within PeopleSoft. SAP was something that could scale and it had all the functionality we wanted.”
But this project was too large for the City to complete by itself — it required assistance with project management, change management and information process design, for which IBM Canada’s Business Consulting Services was hired on a three-year contract. At its peak, the City’s transition team had about 160 members, 45 to 50 of them consultants, Geddes said.
The entire overhaul was done in stages. Since users were to access SAP over the Web, connectivity was an issue. “Only about 10 per cent of the City’s population lives in the urban core. We had lots of users of the system who are located in rural areas…(and) we had to get them some bandwidth,” Geddes said. Telecom Ottawa, a subsidiary of Hydro Ottawa, provided the connectivity.
The information overhaul was an 11-step process covering human resources, payroll, utilities, public works and real property asset management. Kevin Jones, the project’s manager and FTP project lead who came in from IBM Canada’s Business Consulting Services division, said the City approached the task department-by-department because that method resulted in better business processes.
The public works and property management departments took the longest to complete: one year to plan and implement the solutions. Jones said HR was also challenging because 16 legacy programs had to be consolidated down to one platform. In the beginning, the system supported about 17,000 employees and 53 different collective agreements, which have since been consolidated down to 13.
“The people challenges were bigger than the technology,” Geddes said. In many cases, users not only had to learn the SAP software, but they had to get used to new business processes, which necessitated extensive training for about 1,500 City staff.
City IT staff now have fewer systems to upgrade and support and fewer applications to integrate. They are able to respond to inquiries faster and spend less time producing reports. The City has already realized $4.5 million in ROI and is poised to realize the rest of the projected $8 million by the end of 2006.
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