The new federal accounting and budgeting system was both a governmentwide reform project and a series of cultural and organizational change projects in the ministries. Even with the legal mandate for consolidation, it would still require an operational strategy to bring the many bookkeeping units into one Federal Bookkeeping Agency. The project team chose to use the ERP implementation to first achieve the necessary technical and process consolidations. That provided a foundation for the physical and organizational consolidations that generated the savings and other benefits. In this way, the technology framework in the SAP ERP software provided one of the enabling mechanism for the system changes. The overall success of the process required other policy, management, and organizational strategies as well.

Project management involved both high level executive attention and a day-to-day operational structure. The high level executive engagement was through a steering committee with representatives from the Federal Chancellery, the Office of the Minister of Finance, the Ministry of Finance IT and budget directorates and internal audit office, the Federal audit office, the Federal Computer Center, SAP Austria, and Siemens Business Services. Operational management was the responsibility of a smaller project team comprised of representatives from the Ministry of Finance IT and budget directorates and Siemens Business Services. They were responsible for overall project management to include budgeting, controlling, and rollout.

The earlier feasibility study showed that an ERP based on SAP software was the only available solution that could cover 85-90% of the Ministry of Finance’s requirements for the new system. The new system would have to serve all 12 ministries in the federal government. According to Erich Albrechtowitz, “It’s very difficult to develop a single software solution that meets all the needs of the 12 ministries. However, you can provide them with a standard.” The SAP ERP software provided that standard. In 1998, SAP delivered the new release with the special features for government budgeting, called Industry Solution Public Sector (ISPS) – now called EAPS. This release contained the needed accounting and budgeting standards for the new accounting and budgeting process for the federal government.

An implementation as complex as this ERP project required substantial support capability for development and training activities. Part of this capability was based in the Federal Computing Center (FCC). This Center, created as part of government “corporatizing” decisions, was created in the mid 1990s in response to governmentwide frustration with public sector IT units that lacked the flexibility and skills to adapt to the rapidly changing IT environment. Without the constraints of government salary and personnel restrictions, the FCC could attract a pool of IT professionals that could offer the techniques and solutions the government needed to meet technology changes and service demands. The FCC began with about 400 employees whose salaries were more competitive with the private sector IT market than the public sector. The FCC has grown to approximately 1,500 employees.

To support the ERP implementation, the Ministry of Finance worked with the FCC to create a Customer Competence Center (CCC) staffed with personnel trained and certified by SAP. Cost effective management of a government wide IT innovation such as this, based on a new technical solution, with thousands of users spread out across multiple government boundaries, would require the personnel and skill only the FCC model could provide. According to Christian Ihle, “The CCC was a focal point of our project. It gives us today an independence and flexibility that we previously did not have.”

The benefits of the CCC are clear and significant. According to Ernst Steiner, Head of Department, Customer Competence Center, “Through the CCC the government saves 50% on the cost of SAP software licenses. Moreover, by relying on the CCC not only as a help desk for system problems but also as a resource for other project development, the federal government is reaping considerable savings compared to what it would have to pay external consultants for the same services.” Further savings result from the CCC staff’s familiarity with Austrian government operations and work with the ministries and other government organizations on a daily basis. This reduced the need to bring external consultants up to speed on the special features of the government. According to Christian Ihle, “The CCC knows who we are, what we want, and how we work.”

Prototyping played an important role in the overall implementation process. The particular prototyping strategy used by the project team balanced the need for standardized processes versus the need to fit the system to diverse ministry situations. To do so, the project team adhered to two principles:

It is not necessary to analyze the old processes in detail. Rather, it is much more effective to create smart and slim standard processes.

People dealing daily with the “old” process should not be involved before the newly designed "standard processes" can be offered.

The principles, according to Christian Ihle, meant that, “We consciously excluded users from the initial creative design step, but let them participate in a second step of evaluation and fine design. This guaranteed full creativity for the design step and full usability for the results.” They were able to work within the project team for the first step due to the teams of expertise with government accounting. The lead contractor from Siemens Business Services and key member of the project team, Mr. Sturm Reinhold, had extensive experience working with the Austrian National Bank and helping to privatize an Austrian telecommunications company. In addition, Mr. Reinhold had over 28 years of experience working with SAP.

The Ministry of Social Security, Generations, and Consumer Protection was integrated into the project to test and refine the newly designed best practice process. This partnership began the prototyping phase of the project. It is important to note that this ministry was not randomly chosen to participate in the prototype. The project team found that employees in this ministry were open to change and modernizing their organization.

Throughout this prototyping phase of the project, the Ministry of Finance and Siemens representatives held structured meetings with members of the prototype ministry to test and refine the work and data processes and test new roles and new work place definitions. According to Heinz Weber, head of the bookkeeping office in the Ministry of Social Security, Generations, and Consumer Protection, “We showed the project team how we did the work previously. Next, they showed us how we could do it in the new software environment. We tested it and proved that their design processes could be realized in practice.” According to Sturm Reinhold, “At this phase in the project, we were able to create a prototype of the new accounting and budgeting system, which was more than a technical prototype. It was a comprehensive prototype for reinventing the organization.”

As a result of the prototype work, the project team defined 10-12 working roles for the accounting and budget process. These typical working roles would now become the standard for the whole Republic. Based on the best practice process, the team was able to take a lot of different work functions previously executed by a number of different people and integrate many of these functions; executed by fewer people. The project team was now prepared to offer these new processes supported by the IT system to the rest of the ministries.