Come See The Facts
In rebuttal to the ideas of Lee Holcomb, NASA's chief information officer, in the April 26 story, "Enterprise Resource Planning: NASA-Style," I offer the following.
The U.S. Strategic Petroleum Reserve (SPR), under the management of DynMcDermott Petroleum Operations Co., just completed a full-scale implementation of SAP R/3. Our implementation complies with federal budgeting, procurement, personnel, property and asset management requirements.
As a managing and operating contractor for the Department of Energy, DynMcDermott has to operate within most of the same requirements as a federal agency. We found R/3 to be extremely configurable to meet these requirements. We are able to develop and maintain multiple versions of budgets, or "rack and stack," as Mr. Holcomb put it. We can collect and record time and attendance to the nanodetail, if we choose.
And because of the full, off-the-shelf integration of every component of R/3, when our employees enter their time to the R/3 Cross-Application Time Sheet, they are reporting not only for payroll purposes; their data also feeds instantly into capital project cost accounts, maintenance work order history records and activity-based cost models.
We are thrilled with R/3's capability to manage our obligations and authorities. Compliance is guaranteed by system work flows and hard-stops, whereas before, SAP errors sometimes got through.
Describing the SPR's examples of the power of an integrated enterprise resource planning system would require more pages than you would care to print, so I will stop there.
In 15 months, we converted from 16 separate systems that never reconciled to streamlined business processes in R/3, including human resources and benefits administration, accounts payable, procurement, material management, property accounting, maintenance, budgeting and cost accounting and project control.
The project will lead to a 47 percent return on investment. Expected savings is $32 million in labor. Productivity and performance objectives also are being achieved: requisition satisfaction time cut by 36 percent, inventory reduced to 15 percent of annual contract budget, accounts payable productivity increased by 1,285 percent per person, budget execution variance improved to no more than 5 percent variance annually, and the cost of accounting for property dropped to 1.2 percent of the value of property.
I believe the SPR's approach of using the world's best ERP product has made us future-safe. There is no way Mr. Holcomb and NASA can replicate the functionality and integration of R/3 or another true ERP package.
Imagine the cost of maintaining his systems when they finally get them completed and working in, what was it, 2002? What cost to the taxpayers when NASA decides to modify systems to include the next great process or technology innovation?
Looks to me like with NASA, we may have another case of a big consulting firm pillaging the federal coffers. In contrast, the SPR has the power of SAP's $1.2 billion per year in research and development to make sure we are always cutting edge.
I encourage any federal agency considering software changes to visit the SPR before deciding that what works in the commercial sector cannot work in the public sector. Come see the facts, live.
Director of Enterprise Systems Projects
DynMcDermott Petroleum Operations Co.
The opinions expressed in the letter are the author's, and not necessarily those of DynMcDermott or the Strategic Petroleum Reserve.