Report of the Deputy City Treasurer and the Director of HROD and Transformation.

This report provides an update on the work undertaken to replace the Council’s legacy SAP HR and Finance system (also referred to as an Enterprise Resource Planning (ERP) system) since the previous report in June 2023, including the completion of the programme’s procurement process and the evaluation and selection of a preferred bidder to provide the software and implementation partner for the design and deployment of the new system.

The committee considered a report of the Deputy City Treasurer and the Director of HROD and Transformation which provided an update on the work undertaken to replace the Council’s legacy SAP HR and Finance system since the previous report in June 2023. 

Key points and themes within the report included: 

·       Providing an introduction and background to the legacy SAP system, which was implemented in 2007; 

·       The vision and approach of the programme;  

·       The procurement process; 

·       Details of the preferred bidder were not yet available due to an ongoing standstill period;  

·       The business case for the programme, including total implementation costs;  

·       How the programme was governed; and 

·       Next steps and timeline.  

Some of the key points and queries that arose from the committee’s discussion included: 

·       Seeking assurances that the project was treated as high-risk and was included on the Corporate Risk Register; 

·       Seeking assurances that the project would remain on track for implementation in April 2025; and  

·       Requesting a further update report in October 2024.  

In introducing the item, the Deputy Chief Executive and City Treasurer explained that the replacement of the Council’s finance and HR system was a corporate project which had the appropriate governance, capacity and assurances in place.  

The Deputy City Treasurer informed the committee that the legacy SAP system was a fundamental system which recorded financial transactions and the Council’s balance sheet and held employee records. He explained that the SAP system was heavily bespoke to the Council, not user-friendly and was timely and costly to upgrade. Support to the current system would end in 2027 and, as a result, the Council decided to replace the system early. He stated that the project was progressing appropriately and that it provided an opportunity to drive efficiencies. Members were informed that a preferred bidder had been selected but a standstill period was currently ongoing, with officers hoping to provide a verbal update on the preferred bidder at the Executive meeting later in the month.  

The Director of HROD and Transformation stated that a programme and implementation team was in place and significant pre-implementation had taken place. He explained that a review of existing processes and ways of working had been undertaken and that officers in Finance, HR and ICT were collaborating on the project. He informed members that a detailed implementation plan had been developed and would be reviewed with the system provider. He stated that the Council had sought extensive references from organisations using bidders, that it had listened to what had gone well in other authorities who had implemented new HR and finance systems and had received independent expert advice. It was intended for the system to go live in April 2025 with a phased implementation. 

In response to members’ queries, the Director of HROD and Transformation stated that there were safeguards in place to manage risk and that discussions had taken place with the Council’s Audit team to ensure that the project was included on the Audit Plan for 2024/25. He also provided assurances that audits would be undertaken throughout the implementation and once the system was live. Whilst guarantees could not be provided that the project would remain on track for implementation in April 2025, the Director of HROD and Transformation acknowledged the risks involved in a project of such scale and stated that he had been involved in implementing new HR system twice in the past 5 years. 

The Executive Member for Finance and Resources acknowledged that it was important to view the project as being high-risk and provided assurances that as portfolio holder for this area, he had oversight of and was involved in the project. He also welcomed continued scrutiny of the implementation.  

Decision: 

That the committee 

1.     endorses the report to the Executive, and  

2.     requests a further update report in October 2024.