Grant Thornton has issued a forensic 66-page report referring to a failed Oracle Fusion enterprise useful resource planning (ERP) implementation at Birmingham Metropolis Council, which has left it and not using a functioning finance system till no less than 2026.
When the council’s Oracle implementation steering committee took the choice to go reside in April 2022, say the auditors from Grant Thornton, “the extent of threat inherent within the Oracle answer was not correctly understood. This resulted within the implementation failing at a major value to the council, contributing to a breakdown of monetary management such that it has been unable to adequately management its funds all through 2022/23, 2023/24 and into 2024/25.
“The governance and programme administration for the Oracle programme had basic weaknesses that have been by no means successfully remedied and have been additional uncovered by excessive turnover of employees in each senior and operational roles,” they mentioned.
Birmingham Metropolis Council carried out an SAP ERP system, ECC6, in 1999, for finance, procurement, HR and payroll functions. Over time, it was customised to suit the organisation’s enterprise processes. In 2006, Capita was engaged to offer council providers, together with the internet hosting of the SAP occasion.
After which got here SAP’s ERP system primarily based on its reportedly high-speed, columnar, in-memory database, Hana, S/4 Hana, in 2015. SAP additionally introduced finish of help for the older ERP by 2025, later prolonged to 2027.
Like many different SAP prospects, Birmingham had a option to make. It opted to change to cloud-based Oracle Fusion, following recommendation from Socitm Advisory, and introduced its choice in July 2019.
It additionally introduced programme help contracts for Perception UK Ltd, in partnership with Evosys for methods integration; Socitm Advisory, for programme and alter administration; and Egress, for knowledge migration providers.
Ameo Skilled Companies was appointed to offer programme administration and assurance to the council type January 2021. The effectiveness of Ameo and the opposite suppliers is the topic of one other report commissioned by the council, Grant Thornton says. Its findings are legally privileged, in line with the auditor, and they don’t seem to be included within the 11 February 2025 report.
As beforehand reported in Pc Weekly, the monetary enterprise case for the improve confirmed that the SAP system, run by Capita, was costing the council £5.1m per 12 months. Over the 9 years between 2022/2023 and 2031/2032, this could quantity to £46m. For a similar interval, the Oracle system was meant to avoid wasting £563k in 2022/23 and £788k in 2023/2024, with the financial savings accumulating over the 9 years to £10.9m.
In August 2019, the council ended its contract with Capita and the vast majority of IT providers have been transitioned to an in-house workforce, together with 300-plus Capita employees, for probably the most half not Oracle specialists. Constructing in-house Oracle functionality proved to be “very difficult”, in line with the report.
As beforehand reported in Pc Weekly, after the go-live in 2022, the Oracle system required guide remediation to repair accounting points. The council’s 2024 monetary report confirmed a funds of £5.3m for continued help and guide intervention on the Oracle system.
The report’s authors word that the failure of the implementation of Oracle Fusion has been a “contributory issue to the council’s monetary place slightly than being a basic issue”.
It additionally notes that the implementation programme failed to stick to its design ideas to undertake Oracle-standard performance, as a substitute selecting to adapt it to align with the council’s present processes.
Enterprise tradition change ignored
Grant Thornton additionally discovered that the council didn’t focus sufficiently on the enterprise and tradition change required to organize the organisation for the Oracle system. Finish customers have been “unprepared and unequipped to make use of the system”, it claims.
It additionally notes that “the tradition of the council seems to be one the place both unhealthy information was not welcome or officers felt uncomfortable to speak unhealthy information. We’ve got reported beforehand on the excessive degree of turnover of senior officers on the council. If the council is to succeed with different main tasks, together with the present ERP venture, and keep away from comparable points to the failed ERP implementation, then it might want to rigorously take into account the way it can change its tradition to certainly one of openness, mutual help and transparency.”
Among the many impacts of the failed Oracle implementation, the auditors word its total value, plus the funding vital to place it proper, might be no less than $90m in extra of its authentic funds. The reimplementation of the system is just not anticipated to be full till 2026.
The council will maintain a gathering on 11 March 2025 to think about the Grant Thornton report, which attracts classes from the botched implementation. These embody “studying factors” with respect to governance and oversight, programme administration, answer design, enterprise change and tradition.
