East Sussex County Council is conducting “a further health check of the system and programme” after it failed to go live with Oracle Fusion, its replacement for SAP R/3.

A report to the Cabinet of the £538 million local authority said in March that the Managing Back Office Systems (MBOS) Programme set to replace core HR and finance systems failed to go live months earlier in November.

Without setting a new date for the implementation, the council said it had completed a review to confirm that “Oracle remains a suitable product for the Council.”

The council is now carrying out “a further health check of the system,” which would “inform next steps and enable programme dates to be reset.”

The clock is ticking. The report pointed out that the council needs to move off the SAP system because it is due to go out of support in 2027. A report in November 2023 from the council’s chief operating officer said the project has been moved to red status as it has not been possible to achieve a November 2023 go-live without compromising on quality. It said the failure was “due to not hitting the necessary targets in Parallel Payroll Running Phase 2.”

In fact, the program had already been delayed. Documents from a 2020 procurement plan said that the council planned to go live from December 2022 and retire SAP and associated systems from April 2023 onward.

The council’s procurement plans were delayed by at least six months owing to the COVID-19 pandemic.

At the same time, a council spokesperson said the SAP system it relied on was based on the German vendor’s R/3 software.

The report from November last year said the system was first implemented in 2004. Because of the delay to its replacement, the council said it would re-platform the system to “a dedicated cloud environment by the end of 2023.”

“The underpinning storage infrastructure currently used by SAP is very old, with increasingly failing components that can only be replaced by reconditioned parts,” the report said. “Re-platforming to a cloud-based hosted environment best mitigates that risk expediently and most cost effectively and can be undertaken during the MBOS review period.”

East Sussex is not the only local authority struggling to get off SAP and onto Oracle. Neighboring West Sussex has seen the budget for its project escalate from around £2.6 million ($3.26 million) to nearly £40 million ($50 million) after a series of delays.

On a grander scale, Birmingham City Council – Europe’s largest local authority – could see the cost of its project go from around £20 million ($25 million) in its initial plans to £131 million ($166 million) if the expected budget is spent. That project went live in April 2022, but it went so badly that the council has since been unable to file auditable accounts. It plans to reimplement Oracle “out-of-the-box” after costly customizations failed to work as expected.