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The State of Tennessee Department of Finance and Administration prepares Tennessee’s US$30 billion state budget, balances the government’s financial books, administers payroll and benefits for 47,000 state employees, and oversees the procurement of billions of dollars worth of supplies and service contracts.
Struggling to cope with a fragmented, siloed architecture—including more than 50 disparate systems across the state that supported various agencies’ financial, procurement, HR, and payroll functions—the State of Tennessee Department of Finance and Administration deployed Oracle’s PeopleSoft Human Capital Management applications, including payroll and benefits administration, and a full range of financial management and service automation software. The department worked with Oracle Insight to gain understanding of its key pain points, strategic vision, and desired goals for its new enterprise resource planning (ERP) platform.
“Many of the applications in our old system were homegrown with no flexibility, and some of the products had been discontinued and were no longer supported,” said Jan Sylvis, chief of accounts, State of Tennessee Department of Finance and Administration.
Making matters worse, many of the people who had maintained the old systems were starting to retire. “We were in a tough spot,” Sylvis said. “We needed to invest in new technologies and systems that would carry us forward for the next 10 to 20 years.”
The State of Tennessee Department of Financial and Administration and Oracle Insight worked together to develop a set of actionable recommendations to help build a unified and comprehensive ERP system. The PeopleSoft solution enabled a more flexible and effective mobile workforce.
When floodwaters raced through Nashville in May 2010, the rising tide threatened to put a significant portion of the state government on hold. But thanks to its financial and human resources (HR) system—based on PeopleSoft Financials and PeopleSoft Human Capital Management—state employees hardly missed a beat. Forced to abandon their downtown offices for days to weeks, workers quickly mobilized at backup locations and at home offices, plugging into a new Web-based workflow system to keep key financial and payroll functions running on schedule.
“During the flood it was so important that we continued to have access to our back-office finance capabilities and enable people to work in alternative locations or even from home,” Sylvis said.
Overall, the department has seen significant value in the PeopleSoft platform’s workflow capabilities, which enable managers to review financial requests along with supporting documents—such as invoices and receipts—in a single step.
“The fact that we have documents that are electronically embedded into transactions, speeds up all of our processing,” Sylvis said. “The documents are right there. You do not have to search for them.”
The streamlined process translates into everything from faster purchases to faster vendor payments.
“It impacts how quickly we can pay people, and that enables us to work with our business partners more effectively,” Sylvis said. Easy access to relevant materials also helps facilitate financial audits. “Auditors love having documents electronically attached to transactions,” she said. “They can look at all the supporting documents and have complete confidence in the audit trail.”
Meanwhile, new service automation applications help the state gain better control over its grant programs—a portfolio of funding projects that contributes billions of dollars to the state’s economy. Using the platform’s grant module, the department can optimize cash flow by better tracking program expenses and accelerating reimbursements from the federal government.
“You do not want to spend at the state level and wait a month to draw down a reimbursement,” Sylvis said. “You want to do it the next day.”
The department is realizing additional efficiencies by giving employees the option of enrolling in healthcare plans and other benefit programs through on online portal. Employees appreciate the portal’s convenience while the state saves money by reducing paperwork. In fact, the move to electronic pay statements saved the department approximately US$500,000 per year in paper and mailing costs. Also, since going live, there has been little to no disruption in operations, and the state has not missed a payroll. Currently the department is working with universities and local governments across the state to introduce the same self-service solution for these organizations’ own employees.
In assessing the range of possible improvements, Sylvis is careful to distinguish between the software’s built-in automation and the various business-process changes the solution can support. Because some business-process changes may impact public policy—and thus require legislation to modify—not every change can be implemented right away.
It is all a matter of timing, Sylvis explained. “We never quit trying to make improvements. Now that we have reached steady state for both the payroll and finance sides, we are going back to make further business changes to reap the benefit of all the ERP horsepower we have acquired.”
Given its extended planning horizon, the department did not want to rush its investment decision.
“We take a lot of pride in running our department conservatively with a maximum of accountability and transparency,” Sylvis said. Before choosing Oracle, the department went through a competitive bidding process and talked to other states to gather a list of best practices. These discussions led to the department’s decision to form a dedicated team of state employees responsible for the day-to-day operation of the new Oracle platform.