Accenture has won a $108.6 million contract to oversee the final stages of the Department of Education and Communities’ (DEC) troubled Learning Management and Business Reform (LMBR) project.
The recently published contract will position Accenture as the project’s Transformation Service Provider, responsible for overseeing the replacement of all finance, HR, payroll and student administration systems at NSW schools, TAFE institutions and state and regional education offices with new SAP-based solutions.
The Transformation Services Agreement contract will cover the delivery of these new IT systems over a 19 month period ending July 2013. An additional $6.9 million will be provided to Accenture for application support and stability services.
Originally launched in 2006, the LMBR project was to be delivered in two phases over an eight year period. However, increased costs and underperformance has forced some major revisions to the LMBR project.
Whilst the LMBR project was originally expected to cost $386 million, the estimated delivery cost of Phase One alone had increased from $153 million to $210 million, as of December 2011.The Department had spent $176 million of this by 30 June 2011.
In addition to exceeding its budget, Phase One also fell short of performance expectations. The new finance system delivered under Phase One for state and regional education offices forced users to create manual workarounds, incurring additional costs for the already over-budgeted project. Staff also failed to receive sufficient training and lacked the adequate skills necessary to fully support the system.
Phase One also included the provision of the SAP Finance system for NSW schools and the SAP Human Resources and Payroll systems for TAFE NSW. Whilst these systems have all been built, as at December 2011 they had not yet been deployed.
Following the discovery of these short-comings, the Department decided to adopt a revised approach to the LMBR program in 2011. This included the appointment of a Transformation Service Provider (Accenture) to oversee the implementation of all finance, HR, payroll and student administration systems, as opposed to delivering separate implementations for each system.
Avanade Australia, Presence of IT, Tribal Group and SAP Australia will all act as sub-contractors for the project under Accenture.
All Phase Two projects have also since been rescheduled to be piloted in late 2012 and Phase Two’s projected costs have also been revised downwards from $218 million to $176 million, recouping some of the increased costs incurred under the delivery Phase One projects.
NSW Treasury has also approved an additional $14.4m to fund extra staff and training to prevent any repeat of Phase One’s staff training outcomes.
The LMBR contract is the latest in a string of wins for Accenture since the start of the 2011-12 financial year. In October 2011, Accenture was awarded a $35 million contract with the Australian Taxation Office for the implementation of client portals, enabling tax payers to collectively view their superannuation memberships online. It was also appointed to the ATO’s application services panel.
Earlier in the year, in August, Accenture was appointed as the National Infrastructure Partner for the roll-out of the Federal Government’s $466.7 million Personally Controlled Electronic Health Record (PCEHR). Within the same month, the company also won a $40 million contract with the Department of Defence (Defence) for data migration services.
Accenture was also chosen again by Defence as one of the five Preferred Industry Partners for the Department’s Applications Managed Services Partnership Agreement (AMSPA).