Implementing SAP R3 at the University of Nebraska

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Implementing SAP R/3 at the University of Nebraska

• Tim Sieber, Keng Siau, Fiona Nah, Michelle Sieber
• University of Nebraska-Lincoln

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Case Objectives

• Present the case of implementing SAP R/3 at the
  University of Nebraska (NU)
• Expose students to the problems and challenges
  involved in ERP implementation
• Students will confront, discuss and resolve these
  problems, issues, and challenges
• Students will evaluate alternatives to resolve
  critical gaps in ERP implementation

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About the University of Nebraska

• Four campuses and central administration
• Kearney, Lincoln, Omaha and Medical Center
• 1998-1999 budget almost 1.1 billion
• Almost 46,300 students enrolled
• Over 11,300 faculty and staff
• Over 400 departments and auxiliary operations
• Approximately 150,000 orders/invoices and 360,000
  paychecks processed annually

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Legacy System Deficiencies

• Not Year 2000 compliant
• Disparate systems (not integrated)
• Does not provide executive-level information
• Software platform that is outdated and user
  unfriendly
• Encourage use of shadow systems

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Strategic Framework

• 1996 to 2001
• Improve management information systems
  continuously improve technological capacities and
  address system deficiencies
• Maximize resources to achieve the mission by
  adopting best planning and business practices for
  all areas
• Continue to seek and adopt best business advice
• Created Financial System Task Force (FSTF)

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Milestones

• May 1996 - Start needs assessment
• August 1996 - Needs assessment completed and
  technology selection process began
• August 1997 - SAP America publicly announces SAP
  America Public Sector as a new subsidiary
• September 1997 - Board of Regents approves over
  10.1 million to implement SAP R/3
• September 1997 - Implementation process begins

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Implementation Process

• Preparation Phase 9/97 - 11/97
• project scope and team orientation
• Analysis Phase 11/97 - 2/98
• develop as is and to be models
• Design Phase 2/98 - 11/98
• map processes to SAP, fit/gap analysis, prototype
  configuration and technical conversions/interfaces
  
• Implementation Phase 11/98 - 3/99
• complete functional and technical design,
  testing, data migration and end user training
• GO LIVE - 7/1/99

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Implementation Team

• Representatives from all four campuses
• FSTF or Steering Committee (8 people)
• Core and Extended Teams ( 25 people)
• 7 functional and support work teams
• several cross-functional teams
• Implementation Consultants (varies)
• Campus Primary Resources ( 60 people)
• Technical Resources ( 25 people)
• Campus Transition Teams ( 40 people)

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Implementation Scope
Financial CO Controlling FI Financial
Accounting PS Project Systems Human
Resources HR Human Resources Logistics MM
Materials Management
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Client/Server Infrastructure
Database Server
Application Servers
RS/6000 SP AIX v4.3
DB2 v5.1
S/390 Server OS/390 v2.5
Client Workstations
Windows 95/98/NT
A 3-tier client/server implementation
OS/2, Unix
MacIntosh
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Fit/Gap Analysis
Business Function Fit to SAP Purchasing 85 Accoun
ts Payable 80 Projects 75 Financial
Management 65 Asset Management 65 General
Ledger 60 Costing 60 Human Resources 60 Treasur
y 50 Budgeting 30 Funds Management 30 Average 6
0 Resulted in identification of 53 gaps
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Critical Gaps

• 14 gaps identified as critical whereby resolution
  was imperative to ensure a fully configured
  system
• 12 in Human Resources module
• 1 in Financial Accounting module
• 1 in Materials Management module
• Potential impact of critical gaps on
• project scope
• resources (human and budgetary)
• timeline
• system configuration

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Critical Gaps Resolution Options

• SAP provides on-site development
• change core program code, compatibility with
  future releases and resolve all gaps
• moderate risk and low expected cost
• IBM provides developers to create workarounds
• temporary solutions, not part of core program
  code and wont resolve all gaps
• high risk and high cost

Continued.
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Critical Gaps Resolution Options II

• Extend project timeline to July 1, 1999 and
  implement the next version of SAP R/3
• delay entire project three months and
  simultaneous implementation of activities
• high risk and moderate to high cost
• University delays payroll until the next phase of
  implementing functionality
• continue with non-HR schedule and interface SAP
  with current legacy system
• low risk and moderate to high cost

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Issues to Consider

• Approximately 75 of the total project budget
  earmarked for consulting resources
• SAP recognition of public sector industry
• Significant turnover with consulting resources
  including four different consulting leads in HR
• Business functions with lowest fit to SAP are
  more unique to public sector
• Most of the critical gaps relate to HR
• Y2K compliance of legacy systems

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Suggested Questions

• Characterize NUs existing competitive
  environment
• role of IT in NUs central administration
• importance of system success in relation to NUs
  competitive strategies
• Decision to implement SAP R/3 in NU
• strengths and weaknesses of SAP R/3 for NU
• is it a good decision?

Continued.
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Suggested Questions II

• Evaluate goodness of fit
• fit between functionality provided by SAP R/3 and
  NUs desired business processes
• Analysis and recommendation
• analyze and evaluate alternatives to resolve gaps
• make recommendation and assess level of risk
• Challenges ahead
• how well positioned is NU to meet future
  challenges?

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Subsequent Events

• SAP provided developers and incorporated some of
  the needed functionality to resolve the gaps
• IBM released due to financial issues
• SAP took ownership and sub-contracted Prescient
  Consulting as consulting partner
• FI/CO/PS/MM WENT-LIVE on July 1, 1999
• HR/Payroll delayed till October 22, 1999