AAC


NEWS FROM NACo www.naco.org


About NACo – The Voice of America’s Counties National Association of Counties (NACo) is the only national organization that represents county governments in the U.S. NACo provides essential services to the nation’s 3,068 coun- ties. NACo advances issues with a unified voice before the federal government, improves the public’s understanding of county government, assists counties in finding and sharing innova- tive solutions through education and research and provides value-added services to save counties and taxpayers money.


The hidden costs of not staying current Story by Mike Mucha


Deputy executive director, Government Finance Officers Association


ell-run governments promote financial transparency, accountability and decision- making that’s based on good data. Finance staff are often in charge of supplying that data in a timely manner — whether it is for the budget pro- cess, program analysis, budget control or satisfying routine re- quests for information. If you could take a look behind the scenes, you’d see the


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extraordinary efforts that go into processing, tracking, manag- ing, manipulating and ultimately reporting that information. More and more governments are now completing these tasks using tools offered by modern enterprise resource plan- ning (ERP) systems, yet many still rely on antiquated software technology from 15, 20 or even 25 years ago. Meeting modern public-sector needs with decades-old tech- nology isn’t easy. Systems must be flexible and able to handle an increasing amount of work so they can respond to changes in accounting rules, expectations for service delivery and the sophisticated operations that most governments run. Managers, executives, elected officials and even the public also expects data to be readily available and usable. Over- coming outdated technology’s substandard functionality and shortcomings requires government staff to maintain and sup- port a patchwork of old databases, legacy code and hundreds or even thousands of Excel spreadsheets, held together by the technological equivalent of tooth picks and duct tape. Today, in a world where cell phones are discarded after two


years and the computing power in everyday devices can out- perform just about anything available a decade ago, it is re- markable that many organizations still rely on “green-screen technology” from the early 1990s to process payroll, manage their budgets and perform the thousands of other routine transactions that power local government. Even organizations with up-to-date maintenance and sup-


port for their ERP systems wrestle with the challenges of time. For example, many governments stick with the original scope of the implementation of their system, seldom activating or


COUNTY LINES, WINTER 2019


implementing new functionality. Similarly, some governments struggle with decisions that


were made during the initial implementation or with be- ing trapped by sub-optimum configuration decisions that restricted the full use of the system. Just as a 20-year-old car that has been maintained to the manufacturer’s recom- mendation is not the same as a new car, a 20-year-old system with all the regular maintenance packs and upgrades is not the same as a new system. A modern, well-run organization requires a modern ERP system to provide a solid foundation for integrated functions, efficient processing of transactions, improved service levels, automated business processes, strong internal controls and the use of data across the organization. Implementing such a system is a large undertaking that


requires commitment and effort from across the entire or- ganization. While the most visible outcome is a new sys- tem, no ERP system implementation is primarily about the software. It’s about the policies and business process that the system supports. Over the past 20 years, GFOA has been involved in more than 500 ERP readiness and implementation projects, and we have seen both the good and bad. A simple Internet search on “ERP implementation failures”


will provide more than enough examples to clearly demon- strate the challenges involved in these projects, but they don’t all end with delays, cost overruns, missing scope, unmet needs, burntout employees or lawsuits. Te fact is that many organizations have been extremely successful in using the ERP projects as an opportunity to transform their organizations, adopt best practices, improve efficiency, provide more effective services, and better promote financial management outcomes. When correctly managed with effective service-level agree- ments, deploying an ERP system in the “cloud” can decrease ongoing costs, reduce the technical staffing effort, and miti- gate technical and security risks. Officials who are supporting or overseeing an ERP proj-


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