County seeking new software vendor to replace SAP system

Marin County will favor 'tier two' ERP vendors in the second go-round

By , IDG News Service |  Software

Marin County has spent at least $30 million on the SAP project, which dates to 2006, and had at one point pursued $35 million in damages. It accused Deloitte of staffing the project with inexperienced consultants, leading to delays and cost overruns.

It also claimed Deloitte and SAP's alleged wrongdoing fell under the federal Racketeer Influenced and Corrupt Organizations Act (RICO), which would have trebled the damages. A judge dismissed the racketeering claims.

In 2010, Marin County announced it would rip out and replace the SAP system rather than attempt to fix the alleged problems with it, saying the first option would cost less money.

After the settlement in January, Marin County continued to use the SAP software and will keep doing so until a new system is implemented. The SAP payroll module will be run in parallel with the new system for a period to ensure there are no problems, said Flanagan.

A Deloitte spokesman didn't respond to a request Friday for comment on the county's actions this week. Deloitte has been under fire of late for its role in developing allegedly faulty unemployment benefits systems in a number of US states.

SAP spokesman Andy Kendzie declined to comment, except to say SAP is "examining" whether to submit a bid to the Marin County RFP.

Marin County has some considerations to make as it moves forward, particularly with regard to its own shortcomings on the first project, said analyst Michael Krigsman, CEO of consulting firm Asuret.

"Part of the challenge with the first system was the ability of the county to absorb changes," he said. "It could make sense for the county to rethink its expectations and scale back the anticipated scope." This would cut costs, lower the amount of process changes and "make the entire project shorter and more manageable," he said.

The county also must be careful in the way it words contracts with the chosen vendors, Krigsman said. While the contract should include incentives for the systems integrator to complete work on time and within budget, it must also leave wiggle room to address any significant issues that are discovered midstream, he said.

He compared the situation to a person renovating their house. While it's desirable for the project contractor to finish the work on time, If he were to lift up floorboards and discover termites, "it only makes sense to deal with the termite problem" rather than ignore it and press forward, Krigsman said.

Chris Kanaracus covers enterprise software and general technology breaking news for The IDG News Service. Chris' email address is Chris_Kanaracus@idg.com

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