e-Literate

Present is Prologue

Tag: Turnaround

  • University of California’s Payroll Project Reboot Now At $504 Million

    University of California’s Payroll Project Reboot Now At $504 Million

    In July 2014 I wrote about the University of California’s project to update its payroll & HR systems to Peoplesoft systems and how the project had ballooned out of scope. The goal of the $156 million project was to save a reported $100 million per year eventually and to replace a 30-year-old Payroll Personnel System (PPS) that runs separately for each of the 11 UC locations with Oracle’s PeopleSoft payroll and HR systems. All systems were planned to be live by the end of 2014.

    At the time, I quoted Christopher Newfield at Remaking the University with this summary:

    The project timeline has grown from 48 to 72 months, and its costs are said to be $220 million (it had spent $131 million by May 2014) . Worse, the repayment schedule has mushroomed from seven to twenty years.

    Well, those were the good old days it appears. The project has now grown to more than half a billion dollars (estimates) according to the Sacramento Bee. The project is now four years behind schedule. (more…)

  • University of California’s $220 million payroll project reboot

    Chris Newfield has an excellent post at Remaking the University about the University of California’s budget situation and how it relates to the recent Moody’s negative outlook on higher education finances. The whole article is worth reading, but one section jumped off the page for me [emphasis added].

    The sadder example of ongoing debt is the request for “external financing for the UCPath project.” UC Path was UCOP’s flagship solution to UC inefficiencies that were allegedly wasting taxpayers’ money–in other words, new enterprise software for the systemwide consolidation of payroll and human resources functions. This is boring, important back office stuff, hardly good material for a political campaign to show the state “UC means business,” but that’s what it became. Rather than funding each campus’s decades-old effort to upgrade its systems on its own, UCOP sought centralization, which predictably introduced new levels of cost, complexity, and inefficiency, since centralization is often not actually efficient.

    I had heard nothing good about UC Path from people trying to implement it on campuses, and have tried to ignore it, but this week it has resurfaced as a problem at the Regental level. The project timeline has grown from 48 to 72 months, and its costs are said to be $220 million (it had spent $131 million by May 2014) . Worse, the repayment schedule has mushroomed from seven to twenty years. Annual payments are to be something like $25 million. Campuses are to be taxed to pay for 2015-era systems until 2035, which is like taking out a twenty year mortgage to pay for your refrigerator, except that your fridge will be working better in 2035 than next year’s PeopleSoft product. Since the concurrent budget document notes efficiency savings of $30 million per year (top of page 4), UCOP may be spending $220 million to save a net $5 million per year over a couple of decades–and going into debt to do it. In the end, an efficiency measure has turned into a literal liability.

    What the hell – a $220 million project to save money? How did this project get in this much trouble?

    (more…)

  • This is not your father’s Blackboard

    Thanks for inviting me to this conference in Las Vegas, but I couldn’t help notice there is no After Party. Could you point me to the BbWorld conference instead? . . . What’s that? . . . Really?? Because I just came out of a product roadmap presentation where people were clapping, and not just for improved customer service but actual product usability and features that people want. . . . OK, OK, maybe you’re right . . . But the ex-WebCT folks were actually clapping the loudest. . . . WTH?

    Blackboard’s user conference this year was unlike any previous BbWorld I’ve attended. After the WebCT acquisition in 2006, the user conferences tended to be love-hate events (love the show and good times, hate the acquisition of competitors and tin ear). After the 2009 acquisition of ANGEL and subsequent changes in the management team, the user conferences moderated to ambivalence. Many of the product announcements were exciting in the abstract, but it was not clear that product roadmaps and new features were directly addressing client concerns.

    BbWorld 2013 was the first time that I’ve seen customers have such a positive response to Blackboard presentations. At least from a short-term roadmap perspective, the product changes presented this year seemed to hit the sweet spot of what current customers have been requesting. There was a sense of appreciation and relief from customers that Blackboard was listening and reacting to them. And that is no small feat.

    (more…)

  • Postscript to CEO Transition at Blackboard

    There are three additional management changes at Blackboard not mentioned in my recent post – two announced over the past week and one announced in April. These changes are worth noting as they further back up the point that Blackboard is in turnaround mode.

    What should we expect from the future Blackboard? I believe the best way to understand future changes at Blackboard is to view the CEO transition as the latest move in a corporate turnaround – and an unsurprising move .

    The additional management changes:

    • Bob Alcorn – chief architect of the Learn product line since 2007, lead architect and designer of Building Blocks, lead developer of CourseInfo, and original member of the Blackboard team – has left the company and will be replaced by David Ashman.
    • Siegfried Behrens resigned his position of Global Manager of US Education for Microsoft and joined Blackboard in the new position of President of Global Sales.
    • In April Bill Davis became the new CFO, replacing John Kinzer.

    There seems to be fairly significant management changes going on, and I would expect more to come once Jay Bhatt is fully in place as the new CEO.

    Update: I should clarify that Bob Alcorn’s departure is significant news, but he left for a new opportunity, not directly from a management shake-up.