Houston schools spell management success 'ERP'
- By Heather Harreld
- Jul 03, 2000
When the Houston Independent School District wanted to decentralize its
operations and create shared decision-making among its 288 schools, officials
turned to enterprise resource planning software.
ERP is multimodule application software designed to help people manage
core business operations, such as accounting and finance, human resources,
parts purchasing, customer service, supplier interactions and inventory
Less than eight months after beginning its ERP project, HISD was using
11 ERP modules to support 2,000 users at 400 remote sites — and the modules
were tied to legacy applications and an existing ERP system from another
Although eight months may seem like a decade in Internet time, it is
light speed for ERP technology, which historically has been plagued with
integration and business process re-engineering problems that forced many
organizations to abandon projects after years of work.
Although household names like Whirlpool Corp. and Hershey Foods Corp.
have faced problems integrating the technology, HISD officials attribute
their success to treating their ERP deadline — Sept. 1, 1998 — as an immovable
target, like the Year 2000 rollover date. In addition, the district focused
squarely on the people factor, investing its best employees in configuring
the processes into the new system and dedicating substantial resources and
time for change management to ease the transition. For the school district,
the first step toward molding each campus into its own operational unit
was to put into place a technology infrastructure to support the vision
for decentralized operations.
In 1996, HISD replaced its IBM Corp. mainframes with a client/ server
architecture, then in 1997 set about looking for an ERP vendor to support
all of the business operations for the district, which operates under a
$1.2 billion annual budget.
The district tapped SAP Public Sector and Education Inc. because its
architecture was robust and its functional offerings fit best with the district's
operations, said Melinda Garrett, HISD comptroller and SAP chairwoman for
the school district. In addition, the package's maintenance requirements
were minimal, she said.
In January 1998, HISD began implementing 11 SAP ERP modules, including
finance, funds management, asset management, cash management, plant maintenance
and inventory management. They went live with all the systems at once eight
months later. The system already has shown a 42 percent return on investment
and has lowered inventory by $1 million, Garrett said.
The most critical factor was tapping the best people from each involved
department, Garrett said.
"This system is integrated — decisions you make can affect everyone
on the team. We had to put our best people on this job," she said. "We actually
took them out of their positions [and] put them in a different building.
They were almost in a think tank situation. We wanted to use our best "out
of the box' thinkers."
The implementation team did all configuration and workflow with consultation
from end users. Philosophies included cutting out inefficient processes
while safeguarding internal controls.
For example, before launching the ERP system, the manual requisition
process could require as many as eight approvals. Now the district has a
two-step approval process in SAP.
As part of this re-engineering, the team only minimally changed the
code of the SAP package. Changing the system leads to expensive upgrades
in the future because the modifications have to be reprogrammed and tested
in the upgraded system, Garrett said.
"SAP has the best business practices built into it," she said. "You've
got to be willing to step back and look at yourself. This is a good opportunity
for a company to re-examine their work processes and see if there is a better
As the implementation team was working to mold new processes to fit
the new system, they were working under a deadline that they knew could
not be moved, Garrett said. "You have to be able to say, "No,'" she said.
"We will go live on Sept. 1. You've got to drill it into people's heads
that there's no alternative. You have to do it."
Once officials completed the business process re-engineering, they turned
their attention to the technology itself, with a focus on integrating legacy
systems and an existing PeopleSoft Inc. ERP human resources and payroll
module with the new SAP system. As part of the installation, the team developed
an interface between the legacy ERP application and the new SAP system,
"The specifications were fairly easy to write. However, it takes lots
of time to identify all the legacy files that must be mapped over in the
interface and to clean up your legacy data to the best extent possible,"
she said. "The best advice I can give is to start early and test a lot."
The interface has two components. On the front end, all of the authorized
labor distribution charges are sent nightly from SAP to PeopleSoft to update
the budget accounts on the PeopleSoft system. On the back end, PeopleSoft
sends data to SAP to book the charges. Although officials expected the interface
between the systems to present more problems, it has been easier than they
expected, Garrett said.
Pushing an integrated system down to the campus level created efficiency
for the district, but it also created some security and access- control
Before the new system was launched, only 50 users had access to financial
data, and now as many as 2,000 could have access control if not regulated.
HISD officials did not spend enough time on the front end building security
into the system, Garrett said. As a result, going back and creating access
profiles and building in authentication was "the mother of all bears," she
The district now uses SAP and Microsoft Corp.'s Windows NT for security
and authentication to control which users can access what particular information.
— Harreld is a freelance writer based in Cary, N.C.