Copied SAP system cuts costs for Auckland Transport

Costs kept low by using copy of existing SAP environment as baseline

Auckland Transport went live with a new SAP enterprise resource planning (ERP) system on November 1, as reported in Computerworld in September last year. Now come the first reports of successfully running a number of business processes, including payroll runs, finance and procurement processes through the system.

The head of information services at Auckland Council, Mike Foley, confirmed the Auckland Transport system cost less than $10 million, but sources told Computerworld it was as low as $2 million.

Auckland Transport kept costs down by using a copy of an existing SAP environment as a baseline. SAP Global Delivery in India made a copy of the system, and after an upgrade and database conversion, the project was handed over to SAP New Zealand for configuration.

“Copying the environment was low cost, low risk and much quicker than building a system from scratch. Another crucial consideration was that we had to be able to implement a new system without putting existing services at risk,” says Roger Jones, general manager of IT & business systems at Auckland Transport.

Auckland Transition Agency (ATA), the body that oversaw the amalgamation of the councils across the Auckland region, chose to build the system this way because of the tight, non-negotiable timeframe – it had to be up and running by 1 November last year – and a tight budget, says an SAP press release. The whole project, from the planning phase to the technical and functional migration process, took about three months, Foley said last year.

As part of the new Auckland Council, which came into power on the 1 November 2010, Auckland Transport took on the transport-related functions previously provided by Auckland Regional Council, Auckland Regional Transport Authority and six city and district councils. This includes public transport, local roads, road furniture, footpaths, parking operations and the associated infrastructure. The SAP ERP solution at Auckland Transport aims to support these functions by providing financials, HR/payroll, procurement, project systems and business intelligence for reporting, says SAP.

While the system was being built, Auckland Transport didn’t yet exist, which caused some “unusual challenges” for the project team, according to Auckland Transport. The project team often had to make decisions on behalf of people who hadn’t yet been hired, says the agency.

“We met the challenging timeline within our tight budget,” says Jones. “From day one employees have been able to enter timesheets, apply for leave and be paid. We’ve been able to raise POs for suppliers and we’ve been able to pay them.”

User feedback from staff and managers has also been “overwhelmingly positive”, he says. Auckland Transport is running both online and classroom-style training to get users up to speed, he says.

Last September Computerworld reported on the Auckland Transport system, comparing it to the $60 million-plus overarching Auckland Council SAP ERP system, after senior ICT professionals within the council raised concern over bloating costs of the latter project.

At the time Computerworld asked why the Auckland Council couldn’t copy existing systems, like Auckland Transport had done, to build the new one, as this could have saved Auckland ratepayers tens of millions of dollars. Instead, the ATA decided to build the Auckland Council SAP system from scratch, incurring expensive consultancy costs.

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