School District has one bear of a computer system, but it’s hibernating

$35 million and counting, it’s only partly done, and money to complete it has run out

Published Thursday, March 6, 2008 | 2 a.m.

Updated Monday, March 10, 2008 | 3:30 p.m.

Business Wire article

Officials knew the Clark County School District’s new computer system was going to cost at least $33 million. They pressed forward, saying it would make employees more efficient, resolve auditors’ long-standing concerns and save so much money by consolidating services that it would pay for itself in three to five years.

Initially, the project was supposed to have been completed by January 2007.

But now, $35 million later, the still unfinished system is being put on hold — to save money.

It will remain on ice for at least a year, saving an estimated $6 million while the district waits for the 2009 Legislature. The hope is that lawmakers will appropriate at least $12 million more to finish the project.

As of Feb. 28, 15 of the 16 consultants hired for the project had been booted from the district’s payroll. Each had been paid from $100 to $300 an hour — for a total of about $642,000 a month.

That amount made Clark County School Board Vice President Terri Janison gasp when the monthly bill was brought up at a board meeting last week.

“It seems like we’re making a lot of consultants rich,” Janison said. “With numbers like that, it has to make more sense to hire employees.”

Keith Bradford, an assistant superintendent supervising the computer project, countered that the district didn’t have employees with the skills necessary for highly specialized work. And later, no new staff positions were added to shift the work away from the consultants, so the district is keeping one consultant onboard — at a rate of $28,000 a month — to continue to help with the portion of the system that is up and running. Bradford said he wants to shift that consultant’s workload to a new full-time employee, but that will depend on whether funding is approved for the new hire.

By the time the remainder of the project is revived, Bradford said, the district will have found cheaper consultants or transferred the duties to full-time employees.

“Just like a bear that goes into hibernation, when he comes out he’s lean and ready to go,” Bradford said. “We’re not going to make the same mistakes.”

The exact cost of “waking up” the program and finishing implementation is difficult to predict, said Jeff Weiler, the district’s chief financial officer. The longer the delay, the more likely the price will go up, he said. If the Enterprise Resource Planning project, or ERP, as school officials call it, had stayed on track, the final cost was expected to be $47 million.

“It would have been nice to see the project through this year,” Weiler said. But, he added, given that the district is struggling to comply with Gov. Jim Gibbons’ call for it to cut $66 million from its budget over the biennium, postponing the computer system “is the prudent thing to do.”

“What if the technology changes so much that the system is useless?” Janison wondered aloud in an interview with the Sun after the School Board meeting. “That’s my big fear here.”

So, is there a chance the district will find itself with the equivalent of a VCR in a world of Blu-ray disks?

“If you hibernate for three months, nothing will change,” said Andrew Beck, vice president of Metaformers Inc. of McLean, Va., which has helped dozens of school districts implement ERP systems. “If you hibernate for five years, there will be a shift in technology and that can present some problems.”

In a recent audit commissioned by the Legislature, the School District was criticized for having departments using multiple — and often incompatible — computer systems. That echoed the findings of past independent auditors hired by the district to review its operations and finances.

The new computer system was supposed to streamline operations and allow five key departments to easily share information online for the first time. But coordinating the departments turned out to be more difficult and more expensive than projected.

So far only two departments, finance and purchasing, have switched to the new system. For the time being, the payroll, human resources and teacher recruiting departments will continue to use older computer systems.

Clark County is not the only school district struggling with ERP projects. Los Angeles Unified, the nation’s second-largest school district, spent $95 million on the same SAP ERP software program used by Clark County. Los Angeles Unified’s payroll department had the system in place in June when more than 30,000 employees were paid the wrong amounts. As a result of the massive payroll system failure, the district has indefinitely delayed expanding the new system to other departments.

Editor’s Note: This story has been corrected. In an earlier version, the last paragraph referered to the ERP software used by Clark County as being from Sun Microsystems rather than from SAP.

Discussion: 9 comments so far…

By vsestini

3/6/08 at 9:07 a.m.

Suggest removal

It is obvious that the CCSD Board of School Trustees are incompetent and unable to handle their responsibilities. They have abdicated their responsibilities to the administration without checking on contracts, reasons for hiring so many expensive consultants,etc.

The solution is simple: as a board member if you can't do the job...RESIGN NOW! Someone should be going to jail over waste of tax payers money!
By MKsoCAL

3/6/08 at 9:48 a.m.

Suggest removal

Are you sure that Sun Microsystems was the software supplier? Wasn't it SAP?
By Dr_Cosmic

3/6/08 at 11:04 a.m.

Suggest removal

In the LA school district it was SAP.
By AngryPostman

3/6/08 at 2:46 p.m.

Suggest removal

What a horrendous waste of money for what is essentially a payroll system.

If the state and the contractors are so incompetent why spend more cash on them? I mean really how much do they have to squander before you fire them? (and next time let the boys at Oracle do it right for you!)
By mgkrebsii

3/6/08 at 4:22 p.m.

Suggest removal

SAP? That's the same software and company that almost put Whirlpool, Hershey's and other once large and successful companies out of business. (Hershey's was unable to make any product OR sales between Halloween and Valentine's Day one year-- peak season! Because of its new SAP software! Whirlpool lost out on a peak season of manufacturing AND sales because of its new SAP software. Both, almost went out of business.) Elected officials need to do a Lexis-Nexis search on this subject. Then ask for their money back.
By ZeddyBear

3/6/08 at 9:31 p.m.

Suggest removal

The current crop of school board trustees and Walt Rulffes must be terminated -- NOW! This computer system is the tip of the iceberg when it comes to spending taxpayers' money. Folks -- demand that the trustees and the superintendent resign! Do it now before they spend even more money on useless items....

BTW -- Perhaps they should have purchased a Mac.....
By schird

3/7/08 at 2:07 p.m.

Suggest removal

It is questionable for school district to adopt the Enterprise Resource Planning system. ERP is primarily designed for enterprise business. The ERP system has to be customized heavily (often cause delays and most likely leads to fail) to meet the district's business practices, and just like to cut the foot to fit the shoes. It is also too good to be true to have one software systems to serve all district needs. It will be cost effective to upgrade and integrate current systems.
By ZeddyBear

3/8/08 at 7 p.m.

Suggest removal

Has the school district contacted UNLV to see if they have someone on their staff to look at this SuperComputer? I would bet the answer is a resounding "NO!" The reason is quite simple: CCSD and UNLV are NOT on speaking terms.... So CCSD would rather pay a group of folks $625K a month instead of picking up the darn phone...... Again, the trustees and Walt have to go now!

This should prove once and for all that the school district should NOT have access to $9.5B in school bond funds.... Think how they would waste that money.
By realistically_speaking

3/12/08 at 9:25 a.m.

Suggest removal

It’s not a “Supercomputer” it’s a software system, that apparently has already been heavily customized to meet the district’s business practices. So, it would have been cost effective to upgrade and integrate current systems, if that’s even possible, THREE years ago, but not any more.

I guess the School Board only meets once per every three years, because otherwise I would find it very interesting that Clark County School Board Vice President Terri Janison is just now, after 36 months, seeing a monthly ERP bill.

I think the main point is being missed, and that is “no new staff positions were added to shift the work away from the consultants”. Who’s decision was that?? When building a heavily customized system that I would think would need to be heavily tested, you can’t have part-time CCSD employees working on it with or without the consultants, else you will wind up like LA Unified…which by the way, has nothing to do with CCSD.