Another big SAP project hits the rocks in Oz

Fujitsu has become the latest service provider to be associated with a failed SAP project in Australia, after a project it led saw the buyer underwhelmed despite going over time and over budget.

The project in question was an asset management system for the government of Australia's Northern Territory. The Territory is huge – Spain, France and Great Britain would all fit within its borders – yet it is home to under 250,000 people who vote for a small-but-feisty Parliament that operates a government closely resembling that of any other Westminster system jurisdiction, complete with ministries and all the trimmings.

In 2009 the Territory's Department of Infrastructure tendered for a new asset management system, and picked Fujitsu's $AUD14m bid for a project expected to conclude the following year.

Tell us if you've seen this movie before, but the project quickly hit trouble, a re-draft of specs became necessary and the go live date was pushed into 2011. The application eventually went live in 2012.

One reason for the mess, as noted in an Auditor-General's report was the fact that “... high turnover of SI consultants saw a total of eleven Fujitsu project managers during the three years from the start of the project until Phase 1 go-live in April 2012.” One of those project managers seems to have worked on the project for eight hours.

It's hard to get skilled folks to work in the Territory, as the climate is challenging and housing expensive. Eleven project managers in three years is, however, an indication Fujitsu's HR department isn't doing well in Darwin, the Territory's capital. The company has emerged in a rather better light than IBM managed after another antipodean SAP debacle that saw it banned from future government work after a project it led soared a cool billion dollars over budget.

But Fujitsu's not the only one struggling to put talent on the ground: the Auditor General also noted that “organisational change management and the level of engagement by user Agencies was insufficient for the size and complexity of the AMS project” while “effectiveness of … governance was affected by a lack of clear recognition and reporting of key risks and issues confronting the project and their potential effects.”

A big source of delays was a bad spec, which took more than a year to re-work. A dud project plan also assumed it would be fine if the application were introduced to all nine user agencies at once, ignoring the possibility of a pilot in one agency.

This perfect storm of mistakes saw the project burn through over $50m of cash, with more expected because the result has been scrapped and a new system ordered.

The Territory's Public Accounts Committee yesterday conducted a public hearing into the project during which infrastructure department deputy chief executive Anne Bradford said IT staff believe the application delivered 97 per cent of the spec, but that users say 12 per cent of functions work as required.

The Territory has now commenced work on a new application. The Reg awaits confirmation as to whether SAP is involved in the project. ®