Building smarter cities on Enterprise Resource Planning (ERP)

10 October 2011 | Rodrigo Becerra Mizuno, Managing Director Government, Worldwide Public Sector

Building smarter cities goes hand-in-hand with using resources more effectively. To eliminate waste and improve efficiency, many cities have considered deploying an enterprise resource planning (ERP) system – if they haven’t already. However, as it turns out, successfully aligning ERPs with public sector needs has been a tricky equation for many cities, resulting in unmet expectations and low satisfaction. 

Since their debut, ERPs have been touted for their ability to help the public sector streamline processes, consolidate various business components under one system for better tracking and budget allocation, and a lot more. However, the warm glow and fanfare is quickly fading, as many cities are waking up next to ERPs that are the equivalent of electronic concrete – locking them into rigid, dated systems that no longer fit with the way they manage daily business. Strange bed fellows indeed!

The bottom line: ERP systems should work for the organization, not the other way around. Smart cities need the flexibility to respond to new business challenges and take new directions. That means the ability to embrace an increasingly mobile workforce and new technologies like the cloud, breaking free from stodgy business processes, and having the ability to adapt to new business directions or changes in mission at a moment’s notice. Most importantly, however, ERP systems have to embrace the unique needs of government.

Consider the U.S. city of Redmond, Washington, which recently replaced an ERP system that was unable to fit public sector needs and could not accommodate the way the city’s departments and employees worked. Home to approximately 54,000 residents and 5,500 businesses to whom the city provides a full range of services, Redmond moved to Microsoft Dynamics AX 2012, the latest edition of our business application software, which is now officially available to government organizations.

With the old ERP system in place, Redmond struggled with restricted access to resources and a lack of business processes tailored to public sector needs. For example, only a few people in the city’s financial group were able to use the ERP system to access financial data. When other departments needed financial information, the finance group would have to pull the information for them and create reports – an inefficient process that was creating workload issues for the finance group and slowing the flow of real-time budget information for managing projects. As a result, this also made it difficult to quickly respond to information requests from the mayor and city council members.

Tracking the finances involved in capital and grant-funded projects also posed difficulties for the city. Without a government-tailored process in place, managers had no consistent way to project expenses, support operations, and pay invoices. Instead, they often addressed these tasks by creating ad-hoc Microsoft Excel spreadsheets.  

With Microsoft Dynamics AX 2012, Redmond was able to automate the generation of the city’s financial information and serve it up via Role Centers, customized to provide information relevant to the city’s various departments. The result was a huge improvement in efficiency by eliminating duplicate data entry, as well as broadening access to information. Now, employees can quickly respond to requests from the mayor and city council members, providing information in real-time.

In designing the new system, more than 700 requests and suggestions by Redmond employees turned into functionality that is part of the solution today, including capabilities to manage capital and grant-funded projects more effectively. All of the above have set Redmond on a path to achieving its goal of becoming a “city of the future.” Watch this video to learn more about Redmond’s success.

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Rodrigo Becerra Mizuno
Managing Director Government, Worldwide Public Sector

Microsoft on Government Blog

About the Author

Rodrigo Becerra Mizuno | Managing Director Government, Worldwide Public Sector

As author of the Microsoft global strategy for governments, Rodrigo acts as a trusted strategic advisor to government leaders worldwide – helping them create IT environments that support their public policy agendas and enable citizen services.