For residents of Oak Park, IL, the failed PeopleSoft implementation is not just another IT statistic. Instead, it represents wasted money that should have gone to productive purpose. Reaction in the local newspaper ranges from anger to resentment.
An internal Oak Park memo from Village Manager, Tom Barwin, to the Board of Trustees highlights the confusion and pain this failed implementation caused to town officials. Local reporter, John Huston, obtained the memo as part of a Freedom of Information Act (FOIA) request to the town; John kindly sent me a copy.
Click here to download the August 2008 memo. I highlighted relevant sections in yellow.
The memo discusses two key points: questionable payments to a technical consultant and reactions to the failed implementation. The payments have little to do with the PeopleSoft system itself, so let's examine comments directly related to the implementation.
Here are excerpts from the memo:
.... I think it is fair to say that I, the board, and [CFO] Craig [Lesner] after his arrival, were simply just gut sick about the prospect of watching a $1.6 million purchase just 5 or so years ago, to be declared nearly a total waste and failure, and watch the effort flow down the drain. Craig hoped and tried to get PeopleSoft functioning well, and on the flip side, did not want to really flag the mistake or multi-year incompetence.
... while we may be able to nurse ourselves along with the present level of PeopleSoft and the workarounds that have been created, until our financial picture improves, we will continue to look for a more appropriate, more affordable system.
... this RFP will not limit financial/H.R. software bidders to an Oracle based system only, which the previous process did, which led to PeopleSoft. Any proposed change out from PeopleSoft will have to be made by the board in terms of an award of a bid/contract. We will look at possible changes sooner versus later, but we might be able to make it to 2010 with what we have now (with no new tools or enhancements being implemented), but we will steadily move toward securing a solid replacement system, and will be running with the risk the current system could crash . ... . meanwhile the combination of situations we are facing has lead to us really analyzing how we approach what we do in the HR - finance realm, and seriously look at alternatives, like outsourcing payroll, or some aspects of HR.
.... PeopleSoft may be a fine system, it is my understanding that 40 or 50% of fortune 500 companies use it, as well as many of the country's top universities. And the software is flexible, and can be tailored to do incredible things for organizations But these big organizations have lots of resources focused exclusively on running PeopleSoft. PeopleSoft needs lots of people.
... as a result of an intensive year of trying to get PeopleSoft to work for us like it should/could, we have concluded that we would normally need at least two full time people, one in IT, and one in Finance, to focus exclusively on this software, in addition to the ongoing fees and product updates and tools that will be needed to keep it going.
... FYI, Craig got PeopleSoft out here to see what they would do, in response to my threat to look into suing PeopleSoft (now Oracle) for misleading us and lack of follow-up implementation coordination.
... along with other things, the Peoplesoft nightmare has convinced me that I need to reorganize and shake up the IT department.
... as a result of the above analysis, we have now put PeopleSoft enhancements on hold and are in a total minimal maintenance mode, as I denied this week's IT request for authorization for another $10,000 PeopleSoft Tools upgrade expenditure from an outside vendor.
As you can see, the town did not fully understand that implementing an ERP system means changing and improving existing processes and ways of working. Many problem implementations result from the customer's incomplete understanding about the extent of process change that will be required.
For small organizations such as Oak Park, this lack of implementation sophistication is quite understandable. After all, these folks don't have a large IT staffing infrastructure and are not experienced with large implementations.
On the surface, it's easy to blame the original system integrator as well as PeopleSoft. Both of these participants should probably have worked more closely with the town to ensure that process change expectations were clear and realistic. However, it's entirely possible the external folks explained everything to the town, but somehow the information didn't sink in.
Most likely, the vendors didn't push hard enough because they wanted to sell software licenses and related services; at the same time, the town probably was caught up in its own hopes and didn't listen sufficiently closely to advice from these vendors. Without more information, there's no way to isolate original cause.
Regardless of cause, this situation offers a striking example of the weeping and crying that occurs when a project fails and precious resources are squandered.
[Weeping angel photo by Canon Fodder.]