Space agency's ERP project faces hurdles

A billlion-dollar SAP rollout at NASA is facing user resistance and regulatory grumbles. Marc L Songini reports

A major upgrade to the core financial systems of the US National Aeronautics and Space Administration (NASA) has caused turbulence for end users and the agency’s inspector general.

The US$116 million (NZ$192 million) financials upgrade is the cornerstone of a larger project, the Integrated Enterprise Management Programme (IEMP). The IEMP uses SAP R/3 4.6 financial applications and, when completed, is expected to improve financial, contractual, asset management and other procedures throughout NASA. An upgrade from R/3 to mySAP is planned next year and the total price tag for IEMP is US$1.1 billion.

Critics claim that five years into the estimated eight-year project, the IEMP has suffered from end-user resistance, data integration problems and a lack of oversight.

In February, NASA’s Office of the Inspector General found flaws in the management of IEMP contracts and demanded improvement. “Despite the criticality of IEMP to the agency, NASA’s monitoring of the contracts was informal and inadequate to ensure that IEMP products and services were procured in a satisfactory, cost-effective manner,” the report notes.

For example, the report states that as of September 2004, five of 14 SAP-related projects, worth US$16.5 million, were for services not even officially funded. The inspector general’s office warned that the lack of centralised oversight could impede NASA’s ability to manage the contracts and it urged that a single set of vendor policies be established.

End-users of the software have concerns about the project, says Lee Stone, vice president of legislative affairs for NASA’s union, the International Federation of Professional and Technical Engineers of the AFL-CIO (the broader US union movement) and the Canadian Labour Congress. The union has been critical of the IEMP and believes the biggest problem is the way it imposes complex accounting processes, Stone says.

There are also various technical problems, including integration gaps between SAP and other applications, such as NASA’s workforce management system. The SAP software can be hard to use and it’s not clear that it’s boosting productivity, Stone says.

“It remains unlikely that NASA will achieve a clean audit again this year, despite the fact that SAP went live back in October of 2003,” he says.

Patrick Ciganer, the programme’s executive officer, doesn’t deny the project’s complexity and the technical and personnel-related challenges. “It’s been very tough, because we were an early adopter and we’ve been under a lot of scrutiny by oversight organisations. There have been a lot of challenges.”

Ciganer says that the inspector general’s criticisms were largely related to procurement and that those issues haven’t affected the technology. He also says that since the core financials system went live in 2003, it has generally worked as anticipated.

However, the system did require some work-arounds, he says. It replaced 150 custom-built applications that supported NASA’s various organisations and the data-conversion process was extremely difficult, he says.

Ciganer also acknowledges that there was some end-user resistance. “This is NASA. We have very smart people. You can’t just say, ‘It will be better for you’.”

For its part, SAP said in a statement that the overall project is a challenging one, but “in the long run NASA will benefit by becoming a more efficient agency.” SAP will continue to work with NASA to “make this process design a success,” the company says.

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