The government of Manitoba wants to streamline and improve how it delivers services to its citizens, so that information is available when they need it and where they need it. The big stumbling block has been the stovepiped operations that sit behind these unifying initiatives.
For many governments, attempts at reengineering the disparate systems into something cohesive have floundered because the technology to make it happen just didn't exist.
But Manitoba has begun the process that will eventually lead to a more efficient sharing of information throughout the huge Canadian province. This spring, the government launched an enterprise-wide finance and human resource computer system, using software from SAP America. The software, commonly known by its generic title enterprise resource planning (ERP), allows the government to perform a range of tasks and to tie the information together.
For the first time, Manitoba and a growing number of state and local governments have a technology that makes reengineering possible. In the private sector, where ERP has already taken root, reengineered business practices are producing big benefits. Firms have reported that significant costs savings and productivity improvements are not uncommon.
Measuring those particular benefits in government is not as easy, but Manitoba is certain of what it will achieve. "We contemplate a fair amount of savings in the streamlining and standardizing of operations," said Kalev Ruberg, Manitoba's chief information officer.
IBM, Intel, Microsoft and ERP
ERP has been around since the 1970s, when SAP, the leading software vendor, introduced the technology. But it wasn't until the 1990s, when the firm introduced a client/server version of its product known as R/3, that ERP began to take off. Today, it's a $15 billion market that's expected to grow 37 percent over the next five years, according to the Boston-based market research firm, AMR Research.
In the private sector, ERP systems automate manufacturing processes, organize accounting data and streamline human resource departments. The idea is that information is entered once at one end and then integrated with other operations, shared with other practices and accessed in a realtime environment. ERP is used by a diverse number of firms, including IBM, Intel and Microsoft, which use it to run their high-tech businesses.
In the public sector, ERP systems are concentrated in finance and human resources. On the financial side, the integrated software packages may provide general ledger, accounts payable and receivable and various specialized accounting functions, including ordering. For human resources, ERP packages may track employees, and handle payroll, benefits and pensions.
In 1997, the federal, state, local and education sectors together represented about 4 percent of the ERP market and had a growth rate of 21 percent, according to AMR. While these numbers pale next to such manufacturing sectors as automotive and electronics (see chart), the government market, along with several other nonmanufacturing areas, is considered hot by AMR and other research firms.
Just a few years ago, up to 70 percent of all reengineering projects failed because computers didn't give workers the information they needed to perform in a reengineered environment, according to Michael Hammer, the man behind the management phenomenon of the '90s. Today, those numbers are beginning to change thanks, in part, to ERP, which helps agencies define what kind of information they need, who needs it and when.
Interestingly, at the same time that ERP systems are taking root, anecdotal evidence is emerging that demonstrates the rising investment in technology is finally boosting the nation's rate of productivity. For years, the output of goods and services per worker barely advanced 1 percent a year. Since 1996, that number has been growing 2 percent annually, and technology appears to be the driving force, according to The New York Times.
While economists continue to debate whether technology is producing an economic