ERP Implementation as an Agent of Organizational Change

1
ERP Implementation as an Agent of Organizational
Change

• Stephen Lightcap
• VP Finance Admin., Cabrini College
• Michael Scheuermann
• Sr. Consultant, Drexel University
• May 2004

2
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
3
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
4
Project Description (cont.)

• Maintain niche culture while providing e-services
  expected by parents and students
• Commitment to providing related infrastructure to
  support access to serviceswireless, desktop
  access, robust and secure network.

S
5
Cabrini College

• Liberal arts sciences2100 students, religious
  affiliation, former womens college, now co-ed,
  established in 1957
• 68 full-time faculty-150 adjunct faculty-147
  staff admin-48 outsourced personnelIT staff
  of 5
• CMDS (Jenzabar)/ ADP / Raisers Edge / SIRSI in
  library
• Some home-grown Web tools to access directory,
  room reservations

S
6
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 MA 7/02

7
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
8
Expanded Relationship Phase II

• Discussion about admin services, business
  processes, what to do after CMDS
• Cabrinidesire to use top tier ERPcost
  prohibitive
• Discussions with vendorproposed an ASP model
  with benefits to all
• Developed plan to implement Banner system at
  Cabrini

S
9
Cabrini Context

• Drexel assist in development of RFP to replace
  core admin. system
• Concerns re partners access to strategic
  information
• IT staffing requirements of stand-alone system
• Desire to further strategic partnership with
  Drexel
• IT not core function _at_ Cabriniwhy do it
  ourselves?

S
10
HE Environment - Limits Vendor and Institutional
Solutions
Number of U.S. Institutions of Higher Education
By Segment Public Private
Comprehensive Research Universities
93
62
Other 4 year Colleges and Universities
504
1,470
Community Colleges and 2 year institutions
968
440 Trade Schools
Total
1,972
1,563
11
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

12
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
13
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

14
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

15
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)

16
Implementation Plan and Schedule

• Readiness meetingsdemo Banner, promote idea at
  Cabrini, get buy-in at all levels
• Chance for Cabrini to differentiate itself from
  peer schools.
• Attract new marketsquality students
• Operate more effectively and efficiently
• Manage operations with sound reliable information
  basis

S
17
Implementation Plan and Schedule (cont.)

• Student systemundergraduate admissions
• Finance
• HR
• Financial Aid
• Training, mentoring and support plan

S
18
Implementation Plan and Schedule (cont.)

• Billing processes and workflow
• Chart of Accounts
• Financial Aid distribution
• Managing variety of admissions schedules

S
19
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
20
Challenges to Drexel

• Get more involved to make it work or follow plan
  and risk project failure (not an option)
• Time commitment
• Doing the workrather than teaching and
  supporting which was the plan
• Cost of support
• D.U. task orientation
• Business continuity plan

21
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
22
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)

23
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

24
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
25
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

26
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
27
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

28
We dont 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
29
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
30
Lessons Learned

• Dont 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
31
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

32
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
33
New Directions for Each Institution

• Drexelnew partners, new initiatives
• Cabrini Phase III
• Collaborative purchasing beyond IT ASP
• Best practices
• Leverage Banner capabilities as users gain
  experience
• Share experiences with others

34
Questions?