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Initiation and Development

In the mid-1990s the Commonwealth payroll, human resources, procurement, and budget business areas were searching for solutions to resolve long-standing and new business and information technology problems.6 The Commonwealth’s aging business information system was known as the Integrated Central System (ICS). ICS was customized by the Commonwealth and had taken about ten years to develop. It was implemented during the mid-1980s. Unlike many other states the ICS did provide the Commonwealth with an integrated system between the HR component and the payroll system. According to Rafael Perez-Bravo, Director, Bureau of Systems, Policy and Program Planning, Office of Administration, “ICS was very mature and it did what it was designed to do very well.” However, it was a legacy system in need of updating.

The Commonwealth’s Corporate CIO Advisory Group (made up of private sector chief information officers from PA businesses) and Gartner Consulting recommended an ERP solution to replace and advance beyond ICS. At that time, the strategic value of an ERP solution had been proven most often in the private sector with limited application in government. This situation provided the Commonwealth with little in the way of best or current public sector practices to draw on and naturally brought with it the risk inherent in any pioneering endeavor. However, the primary advantages of ERP in the private sector supported the Ridge Administration’s strategy to use technology to enable government change. The primary advantages of deploying the ERP software were expected to be:
  • “Best business practices” incorporated in the software;
  • state agency officials and staff would have ready access to real-time data for making better informed business decisions;
  • improved infrastructure from which to deliver electronic-government services;
  • increased opportunities for employees to enhance service delivery;
  • potential for delivering improved service to internal and external customers; and
  • economic development resulting from more effective state government operations making PA more attractive for business.7
In early 1999, the Commonwealth began two separate but closely related procurement processes: one to select the ERP software and a second to select a systems integrator to help state agencies manage their migration to a new ERP-based business information system. In June 2000, SAP was selected under a competitive procurement to provide its software and in December 2000 KPMG Consulting was selected as the system integrator to help the Commonwealth plan and execute the transition from the existing Integrated Central System to the software. The three-year contract for both the software and consulting was for approximately $51 million; funding for which was included in the 2001 Commonwealth budget.

6 Case for Change Report for Imagine PA, KPMG Consulting, April 27, 2001.