Magazine article Technology & Learning

Notes from a Centralized Office: A Renewed Interest in ERP Has School Administrators Reconsidering the Vast Business Management Systems They Abandoned a Few Short Years Ago

Magazine article Technology & Learning

Notes from a Centralized Office: A Renewed Interest in ERP Has School Administrators Reconsidering the Vast Business Management Systems They Abandoned a Few Short Years Ago

Article excerpt

It used to be much easier to get paid by the San Diego Unified School District. A lot easier, that is, if you didn't work there. Saddled with an antiquated computer system and manual, repetitive data entry of time cards, officials at California's second-largest school district discovered the payroll department was mistakenly issuing $1 million a year in paychecks to former and retired employees.

And the human resources department was in no shape to catch such a staggering oversight because employees were relying on a 30-year-old, mainframe-style computer system not compatible with other school departments--and one that required staff to regularly re-input information for the district's 20,000 employees.

How to fix the problem? SDUSD officials knew they had to start over.

Like other school systems across the nation plagued by overburdened and inadequate information technology, San Diego embarked on a complete overhaul of its computer network and data center. In 2002, officials there purchased a $26 million business management system, known as enterprise resource planning, or ERP, that handles all of the finance, HR, and payroll demands of the district's $1.1 billion-a-year operation.

Today, the SDUSD boasts a successful enterprise-wide system run by Oracle/PeopleSoft software that has reformed every aspect of its operations, But unlike other school systems across the nation that have attempted--and failed at--such projects, in San Diego, ERP works.

"On the business side, this is the most important thing we've ever done," says Michael Casey, executive director and CTO of the 136,000-student San Diego School District. "What ERP brought was a disciplined approach to doing business. When you're running by a paperwork process, mistakes will be made."

May not be long before other schools choose to follow suite, emulating San Diego's model.

Indeed, ERP as an industry is expected to grow by as much as 11 percent in the next four years. And much of that growth can be credited to a renewed interest in schools countrywide looking to jettison their old "legacy" computer systems. These older systems, typically built piecemeal over time, using COBAL, are inadequate to handle the current crush of data generated by No Child Left Behind reporting mandates.

It seems ERP is back. And despite a shaky track record in both business and education, it just might work.

Simple theory, vast system

Long a mainstay in manufacturing companies that could afford to invest in information technology, ERP is a valuable tool for those wanting to combine department functions.

The systems are massive (usually with millions of lines of computer code), but the theory behind them is quite simple. ERP is based on building a centralized network so that departments within an organization can share information housed on a single database.

For instance, instead of having separate programs written for specific functions in different departments such as HR and finance, ERP streamlines the entire operation with one multifeatured application software package.

Such systems, many of which are offered by SAP and Oracle/PeopleSoft, have certainly been popular at companies that process customer orders, where a single system tracks an order from placement through delivery.

When ERP works, it has saved companies a lot of money through improved efficiencies: redundancy is eliminated and employees can take advantage of ERP features that make it easy to track production schedules, to control inventory and purchasing, and to follow planned maintenance schedules. All steps that save money.

But many of the ERP projects underway in the late 1990s were notoriously difficult to implement and so riddled by cost overruns they were abandoned. According to a recent report in the Wall Street Journal, both Hershey Co. and Nike Inc. blamed faulty software for multimillion-dollar write-offs. …

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