In the globalized world, the government plays the main role as a promoter of the use of Information and Communication Technologies based on the impact that its use has shown mainly as part of the private sector from the use of systems for the internal administration of organizations with the use of Enterprise Resource Planning (ERP), on the customer's side the use of Customer Relationship Management (CRM) systems and seen from the production point of view the use of Supply Chain Management (SCM) systems, which have allowed a better use of resources and great cost savings at all scales.
It is for this reason that despite the fact that these initiatives have taken place in companies, who in order to remain in the market must be competitive and profitable by offering value to customers, for its part the government is also an institution and its operation can be comparable to that of the company, under another approach of service to the citizenry from which it is supported by the collection of taxes that allow it to pay for its activities.
The citizenship, which in this case could be seen as the competition of companies for the private sector, the former demands more and more transparency from the government and accountability that demonstrate a more efficient administration, which is why governments have been being forced to modernize the entire government platform, venturing into the use of systems that have already paid off in the business sector.
The government plays a driving role and promoter of Information and Communication Technologies and in the incursion of the Internet in government as one more way to provide better services to citizens through what is currently known as electronic government.
INCORPORATION OF INFORMATION TECHNOLOGIES IN GOVERNMENT: ERP
The relationship between Information Technology and productivity has been widely discussed but poorly understood. The delivery of computational power in the US economy has increased more than twice in magnitude since 1970, although especially in the service sector it seemed to have stagnated. Robert Solow, the Nobel laureate in economics once claimed, "We see computers everywhere except in productivity statistics." It appears that the productivity deficit is more due to deficiencies in methodological measures and tools than to mismanagement by IT developers and users. With productivity being a measure of technological contribution, Chief Executie Ofificers began to question about investing in computers and related technologies.The study findings have demonstrated the erroneousness of the statement, finding a correlation between high IT expenses and productivity at the national economy level of the United States is not significant since other factors can affect productivity, other factors are poor measurement, lags due to learning and adjustment, redistribution and dissipation of profits and mismanagement of information and technology. (Brynjolfsson, 1994)redistribution and dissipation of profits and mismanagement of information and technology. (Brynjolfsson, 1994)redistribution and dissipation of profits and mismanagement of information and technology. (Brynjolfsson, 1994)
A study by the University of California, shows that IT in the background has positively impacted companies and that the Internet generated savings of 155 billion. (Cisco, 2001)
The governments of the OECD member countries recognize the benefits of using Information and Communication Technologies in particular to enhance the best governance practices, being more responsible and managing or governing more effectively (OECD, 2002).
ERP systems are the product of growing competitive forces both within a global environment as well as in domestic markets. ERP systems have recently revolutionized the ways in which organizations run their business processes and functions. (Chang, Gable, Smithe & Timbrell)
Although the deployment of ERP systems originated in the private sector, public sector bodies led by an efficiency-related responsibility are increasingly adopting ERP to replace existing control and operational systems. (Chang, Gable, Smithe & Timbrell)
Large companies have thousands of clients who do not know the government in the same way, so its loyalty and / or trust has diminished, today it is economically possible to store and manage this data on a computer that was previously stored in the memory or on paper, so it is necessary to determine the best way to offer them special services and build a long-term relationship. (Infiniti Systems Group)
ERPs have not only increased the ability of organizations to collect more information in greater detail and in real time, but also bring with it its vertical, lateral or dispersed dissemination throughout the organization. The intensive use of information has been suggested by various researchers (Simons, 1991, Gold, 1990) as a means of control in such a way that the easy availability of information ensures that managers remain in contact with activities in context and are able to to involve themselves in the decisions of their subordinates.
The consultants suggest that an ERP system should consider including best practices in a way that organizes data and processes, conforming to existing organizational practices. (Davison, 2002)
The reengineering of organizational processes and the subsequent implementation of an ERP involves changes in the description of job functions and required skills, as well as empowering employees with decision-making responsibility. (Davison, 2002)
In recent years, local governments have begun to recognize the benefits of implementing ERP software for their internal administration systems. ERP makes it easier for agencies to replace already difficult-to-maintain legacy systems, as well as eliminating redundant data entry, storage and processing. (Ferrando, 2000; IBM, 2001; Miles, 2003 & Towns, 2000)
Despite the benefits, many local governments and agencies are suspicious about the costs and time required to implement this type of system. (Ferrando, 2000 and Miles, 2003).
Governments are beginning to capture the value derived from ERP implementations once they digest the change that must take place. (Towns, 2000)
There is great pressure to reduce costs while providing more services, it is the endless battle to increase productivity and efficiency. For different reasons, state governments currently face a time of great challenges. (Towns 2000 & IBM 2001)
Many states have estimated falls in their income and on the other hand the demand for services centered around the citizen is the largest on record. (Bearing Point)
State information technology directors are gaining ground by adopting private sector operating principles. They are using a wide number of IT tools to create efficiencies, empower employees to generate higher levels of citizen satisfaction, one of these tools is the use of ERP systems that is at the heart of a government that allows connection with the citizens. (Bearing Point)
Enterprise Resource Planning (ERP) and e-business Technologies are being rapidly integrated, although the nature of the union is still uncertain, therefore, for the business world it is essential to understand their functionality separately. (Kenneth, 2000) Organizations were the first to be forced to integrate their legacy systems due to the presence of large volumes of information transactions. (Mohammad & Chase)
ERP systems move an organization from time consuming business processes that make great use of paper to one with electronic processes resulting in time savings that allow them to provide added value for their customers. (Towns, 2000)
The internet has completely turned the business world upside down. This new and apparently not limited channel has transferred great power to the entities involved in the transaction processes. Individuals today have more information than at any other time, so citizens know what they want and know where else they can find it (Chase).
ERP is focused on the efficiency and effectiveness of internal processes while e-business is focused on the external, on the efficiency and effectiveness of cross-business processes and product promotion; on the other hand, ERP supports current business strategy processes while e-business opens the door to new strategic opportunities. (Kenneth, 2000)
E-business applications see inward from the outside and connect the information of the company with the outside of the entity, in parallel the ERPs that traditionally focus on internal activities are obliged to look out from the inside seeking to provide information on the company to external allies. (Kenneth, 2000)
Web-based technology moves information along the value chain, bringing together previously separate groups that now communicate faster and more efficiently via phone, fax, email than face-to-face; On the other hand, web-based technologies are cheap, easy to use and easy to implement compared to previous generations of communication software. (Kenneth, 2000)
In the long term, ERP lays the foundation for the next level of government transformation, providing the official infrastructure for e-government. (Bearing Point).
For small governments, the decision to choose an ERP is a huge and difficult decision when taken into account given the budget and resource constraints, originating a natural reaction of opposition, as much as possible and perceiving the processes and functionalities and the complexities of implementing an ERP, thus staying above the purpose of replacing old legacy systems with new products built on the promise of helping government agencies achieve improved efficiencies. (Smith)
ERP lays the foundation for e-government initiatives that meet demands for better services, greater convenience, and efficiency. (Bearing Point)
ERP systems when fully installed consist of integrated modules that can be seen as central repositories of internal corporate information derived from the 5 main processes: finance, logistics, manufacturing, human resources, sales and marketing; This software allows the organization to effectively and efficiently manage all the information and internal resources to achieve its goals. (Kenneth, 2000)
ERP is a software that integrates products that can be used for a range of business processes, in the case of government, they typically include functions such as finance and budget, purchasing, human resources, payroll, and travel. (Bearing Point, Govtech, IBM and Terry, 2000).
Among some of the modules we have:
- The e-procurement module is a comprehensive solution for online sourcing that allows the public organization to streamline processes, reduce costs and distinguish spending patterns and negotiate more effectively with suppliers, supporting the reengineering of the public sector through processes and improved automated flows help find new value and gain new efficiencies throughout the buying cycle. (SAP) The human resources module manages everything related to employee payroll. (SAP) The module related to the administration of the customer relationship allows to manage and manage more effectively to serve citizens and companies more responsibly, providing external and internal coverage of citizen service functions including Internet, call centers, email, fax and face to face.(SAP) The financial accounting and fund management module supports the traditional structure and processes of government agencies to counteract the growing demands of citizens and the scarcity of funds by supporting double entry methods, to increase transparency and control, to the existing accounting and the fiscal one. (SAP) The public sector income and tax administration module classifies tax subjects to carry out millions of annual transactions, in view of the demand for a personalized and responsible service and non-integrated and discrete processing systems. in the public sector it is used to control all internal services and for cost flows that allow informed decision making,to provide citizen-oriented services in a cost-effective manner. (SAP)
There are ERPs such as SAP / R3, PeopleSoft, and Oracle, they are software solutions that promise the integration of the entire flow of information throughout the company, including information related to finance and accounting, human resources, supply chains and customers. and that will allow to achieve fast cycles, reduce costs and improve customer service, which has motivated their adoption by the private sector in recent years. (Sia, Tan, Soh & Boh, 2002)
An ERP implements the information technology architecture of a company, makes consistent business processes and secure access to information that the government must have to create a new type of electronic service delivery. (Bearing Point)
ERP capabilities unify all agencies across government in the same business processes. Previously, incompatible systems and dispersed business processes were used, hindering the ability to exchange information and discouraging them from operating as part of a unified government enterprise. ERP solves the challenge by generating a broad overview of the organization of human and financial information resources, giving managers and decision makers of the dependencies the tools to make informed decisions. Generate image gains by creating a uniform architecture for transactions and information sharing that makes the government look at a single point of view. (Bearing Point)
As the processes are uniform, the ERP is a tool that facilitates the transformation of the government towards the best that it can be. The gains in cost and time achieved allow employees to take more time to respond to the needs of the public. (Bearing Point)
Technology is placed at the heart of the process, a "business transformation" process about changing how people think and work, ensuring that they have the integrated tools to make the government efficient and responsible (Bearing Point).
To deliver e-government services to citizens and businesses, cities and states must have a modern and integrated, web-based infrastructure, which is part of what an ERP system offers. (Roberts, 2002)
Among the 5 best practices for the implementation of an ERP are obtaining the support or patronage of executives, wondering what the software can do, talks with experts or with people with similar functions who have already experienced a similar change, locate and affiliate colleagues with whom you can work and finally, mentalize and pay attention to the process. (Roberts, 2002)
There have already been several cases of adoption of ERP technologies by government agencies, among some of them we have:
- In the experience of Pasadena California, one of the main cities that implemented an ERP solution, it shows that the process, although challenging, offers great rewards. Pasadena is now looking to integrate ERP with the Internet to facilitate access to information for citizens and for employee self-service, and some agencies are even beginning to consider the development of portals. (Ferrando, 2000) The Queensland government adopted a financial management system in 1983 and it is in 1995 that it decides to adopt SAP R / 3 in its finance module. (Chang, Gable, Smithe & Timbrell) In Pennsylvania they recognized the value of ERP technology and its implications in e-government initiatives. Pennsylvania has the best efficiency rating of any state,given by the citizen employee reason. (Bearing Point) In 1998 Phoenix launched the ERP system in its SAP financial management module, which is how the city was able to integrate its 400 legacy financial systems. (Towns, 2000)
A problem in the implementation of an ERP is the underestimation of the associated change in relation to the systems; another is accelerated implementation, the pressure to deliver systems against the established times that do not take into account the necessary steps that must be carried out, and finally, the lack of qualified personnel. (Towns, 2000)
The role of the government is that of an example to follow, a progressive government in the use of technology to achieve efficiencies and that will make companies look favorably on the reallocation or expansion in that state (Bearing Point).
Successful ERP implementation requires a combination of visionary leadership, strong commitment, and a desire to be flexible and innovative. (Bearing Point).
CONCLUSIONS
The government, through an adequate process of modernization and governmental innovation, already greatly promoted in the countries at the forefront in the use of technologies, will obtain considerable improvements in the use of public resources in all spheres and levels of government (federal, state and municipal).
It is unavoidable to recognize the gains in administrative efficiency and decrease in costs through the appropriate use and correct implementation of technology in any organization, the importance of combating resistance to change in human resources is fundamental and key to the success of the changes in government processes.
The establishment of a sustained policy of modernization and adoption of the most modern technologies outlined in a long-term plan within government entities, as well as the development of a process reengineering, is not of less importance.
The integration of information technologies and the Internet in government will generate greater transparency and will allow a new modality of service to citizens, companies and government itself that includes a transformation of the processes involved in addition to the importance of standardizing these at all levels that allows them to monitor and evaluate them automatically and generate follow-up policies in real time.
In particular, the use of an ERP system helps the government to work better and for everyone. (Bearing Point).
BIBLIOGRAPHY
- Bearing Point. Transforming Government through Enterprise Resource Planning, The Government Technology Solution Spotlight: Bearing Point. http://www.bearingpoint.com/about_us/Transforming_Government.html Brynjolfsson, Erik. The Productivity Paradox of Information Technology: Review and Assessment, Communications of the ACM, December, 1993; and Japan Management Research, June, 1994 (in Japanese). http://ccs.mit.edu/papers/CCSWP130/ccswp130.htmlChang, She-I; Gable, Guy: Smythe, Errol & Timbrell Greg. A Delphi Examination of Public Sector ERP Implementation Issues. Information System Management Research Center, Faculty of Information Technology, Queensland University of Technology Australia. http://portal.acm.org/citation.cfm?id=359793&coll=portal&dl=ACM&CFID=6922745&CFTOKEN=1711344Chase, Peter, R.“Why CRM implementations fail… and what to do about it”, Scribe Software Corporation.CISCO. News & Cisco, New Study Reinforces Information Technology's Positive Influence on Profitability and Productivity. December 3, 2001. http://newsroom.cisco.com/dlls/ts_120401.html Davison, Robert. Cultural Complications of ERP. Technical Opinion. Communications of the ACM, July 2002, Vol. 45, No. 7. Ferrando, Tom. ERP systems help with integration, American City & County;, Vol. 115 Issue 11, p12., Business Source Elite, EBSCO Host.Goold, M & Quinn, JJ (1990). "The Paradox of Strategic Controls," Strategic Management Journal, Vol. 11, pp. 43-57.IBM. Australian Bureau of Statistics, Australian Census, IBM transforming government. IBM Public Sector Case Studies. http://www-8.ibm.com/solutions/au/publicsector/gov_sols/govsol6.html,2001 Infiniti Systems Group, A CRM White Paper, Integrating Tomorrow's Technology Today.Kenneth, M. "E-business and ERP: Transforming the Enterprise." John Wiley & Sons, Inc., 2000. Mohammad, Ismail S. (n / d). A Methodology for Integrating CRM Applications With legacy systems, Infosys Technologies Ltd., Banglore.OECD. Measuring the Information Economy. Chapter V ICT in education and government, pp. 75-79, 2002. http://www.oecd.org/dataoecd/34/36/2771146.pdf, 2002 Roberts-Witt, Sarah L. The State of ERP, State Tech, http://www.cdwg.com, October, 2002 Sia, Siew Kien; Tang, May; Soh Christina & Boh Wai Fong. (2002). Enterprise Resource Planning (ERP) Systems as a Technology of Power: Empowerment or Panoptic Control ?, Information Management Research Center Nanyang Business School, Nanyang Technological University,The DATA BASE for Advances in Information Systems, Vol. 33, No. 1., Winter, 2002 Simons, R. “Strategic Orientation and Top Management Attention to Control Systems,” Strategic Management Journal, Vol. 12, pp. 49-62., 1991 Smith, Matt. Making ERP Work for Small Government. http://www.misa.bc.ca/docs/pdfs%2FMISA%20NEWS/Making%20ERP%20Work%20for%20Small%20Government.pdf Terry, Lisa. Feds, States Lean on ERP as E-Gov Pillar, Washington Technology, 09/25/00; Vol. 15 No. 13.Towns, Steve. Embracing the Enterprise in ERP.Lisa Feds, States Lean on ERP as E-Gov Pillar, Washington Technology, 09/25/00; Vol. 15 No. 13.Towns, Steve. Embracing the Enterprise in ERP.Lisa Feds, States Lean on ERP as E-Gov Pillar, Washington Technology, 09/25/00; Vol. 15 No. 13.Towns, Steve. Embracing the Enterprise in ERP.
IMPORTANCE OF THE USE OF ERP IN THE PUBLIC SECTOR.
Contributed by: María Blanco
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