A Plan for the Implementation of Enterprise Resource Planning (ERP) for the State of Texas
Besides correcting deficiencies associated with the State’s existing administrative systems, the most compelling reason for implementing an ERP system lies within the technology enablers that support the system. A more detailed discussion of key technology enablers can be found in the Report on Business Case Analysis for a Statewide ERP System. Key technology enablers found in ERP software include:
- Integration with a Common Database – The most distinguishing factor of an ERP system is its integration across all system modules. Integration in an ERP system is supported by a single database across all functions (or at least a single database for human resource/payroll functions and another for financial management/procurement functions). In this way, data elements (e.g., account codes) are not duplicated when used for more than one purpose. With no duplication, every function has access to the most recent information, and once any change is made, it is immediately available to all functions. Reports are generated using a single, up-to-date data source that helps to provide the State’s leadership with a “single source of the truth.”
- Real-Time Processing – Many of the current administrative systems perform a majority of their transaction processing via batch jobs that process only a few times a day or during a nightly batch run. This limitation results in delays between the time an action is entered into the system and when the data is available for use by the end user. In contrast, ERP systems use real-time (or near real-time) processing, so transaction results are immediately available to all system modules.
- Increased Functionality / Best Business Practices – Today’s ERP systems provide a considerable amount of functionality to meet governmental financial management, procurement, asset management, human resources/payroll, and other administrative business needs. The application modules that often comprise ERP systems have been designed in accordance with industry-standard best business practices. While best practices have not been defined by any governing body or research firm for the private or public sector, such practices have evolved over time with each new software release and have been validated with each ERP implementation. Best practices, together with the flexibility provided by other technology enablers inherent in ERP software today, allow governments to conduct their administrative business processes in a more efficient and effective manner. Best practices promote standardization of business processes across government, and it is critical that the State embrace these practices in order to implement the ERP software with minimal customization.
- Web-Based / Open Architecture – Today’s leading ERP solutions are designed to be accessed via Web browsers. Vendor products are transitioning to a “pure Web-based” architecture whereby no code resides on the client other than the web browser. Web-based ERP solutions result in easier deployment and lower costs of IT infrastructure, network administration and information access. A Web-based system facilitates providing wider access at a lesser cost to the state. End users can gain access to the ERP system at anytime as long as they have access to a Web browser and the proper security authorizations. Another advantage of Web browsers is the ability to use accessibility tools to obtain compliance with Section 508 of the Americans with Disabilities Act. The leading ERP systems also comply with open architecture standards. Open architecture provides a means whereby the ERP system can be linked to specific “best-of-breed” software if the need arises (e.g., possibly to meet fleet management requirements). Open architecture also provides the ability to interface the ERP system to common desktop “office-suite” applications (see Desktop Software Integration below).
- Scalability – Scalability allows the state to size its system components to meet the everchanging business needs. Increased capacity can be added, upgraded or removed as computing needs change, without substantial changes to the application. Scalability considerations include increasing memory, adding additional processors, and installing additional disk storage.
- Portability – Portability provides the flexibility for application software systems to run on multiple hardware platforms or provides built-in capabilities for switching between platforms without requiring reinstallation or additional customization, thus allowing the State to adapt the system to the technical landscape as it changes over time.
- Graphical User Interface – ERP systems utilize a graphical user interface (GUI) that provides user-friendly features similar to other office functions on the user’s desktop, such as intuitive icons, pull-down menus, point-and-click navigation, pop-up windows, scroll bars, radio buttons, the use of color for clarity and emphasis, and tool bars to assist in the user’s learning and ongoing use of the system. They also provide online help menus and online documentation, as well as screens that can be customizable to user roles to enhance the end user experience.
- Efficient Modification Where Necessary – Assuming that an open architecture is used, the business rules associated with the system are separated from the rest of the architecture, thus, it is easier to change the business rules (a common occurrence in government) than if they were included in the user interface or the database design.
- Extensive Development Toolset – ERP systems provide for a single (often proprietary) toolset to support software configuration, customization, and ongoing administration of the system. Although use of the toolset requires specialized training and technical knowledge, the development toolset is typically integrated with the functional ERP software and is supported by the vendor. The development tools are also utilized in establishing workflow, managing security and in implementing a software upgrade.
- Application Modularity – An ERP system consists of a series of application modules (e.g., general ledger, accounts payable, purchasing, asset management, payroll). These application modules are designed to be “stand-alone” if necessary, though some modules require that others be in place to fully utilize the functionality provided. This modular approach allows governments to selectively implement ERP functionality based on functional need, priorities, funding availability and staff availability to implement and support the system. The entire ERP solution may be built on a piecemeal basis. Additionally, the government can substitute a third party solution in lieu of the ERP module if necessary to meet a specific business need.
- Advanced Reporting Tools – ERP systems typically provide a suite of ad hoc reporting/query tools to allow properly trained end users to develop their own custom reports. Electronic report routing capabilities are often provided with some of the systems.
- Security – ERP systems provide a robust security function across all ERP modules, including role-based security, screen- and field-level security. With this robust functionality comes a new culture around security set up, approvals and administration, as well as staffing resources.
- Automated Workflow and Approvals – ERP systems provide automated workflow capabilities that support electronic document routing, review and approval, provide for inquiries on document status and provide an efficient document filing and retrieval process. Automated workflow also facilitates the implementation of a “paperless” environment, eliminates “paper document shuffling,” and often reduces the layers of approval.
- Drill-Down Capability – ERP “drill-down” capabilities allow an end user to drill down on a field on a screen or report through successively lower levels of detail all the way to the initial entry source document.
- Comprehensive Audit Trail – ERP systems provide online access to a comprehensive history of all changes made to a record in the system.
- Flexible Chart of Accounts – The flexibility provided by the chart of accounts is the greatest factor in determining the usefulness of a financial system. ERP systems provide for a flexible and customizable chart of accounts structure that is supported by relational database technology, sophisticated ad hoc reporting tools to improve financial and budgetary reporting, and minimize the proliferation of “shadow” systems across state government.
- Desktop Software Integration – ERP systems provide the ability to easily extract data from the ERP system into common desktop “office-suite” applications such as Microsoft Office for data manipulation and analysis. Most ERP software also supports the import and export of data to/from the ERP system, which can facilitate the uploading and downloading of information from different systems or sources.