NSW Education's costly LMBR to finally arrive

Ten years after NSW Education signed off on its delayed and costly learning management and business reform (LMBR), the software will next year start being rolled out to the majority of the state's schools. 

The state education body established the LMBR in 2006. It planned to deliver the IT overhaul in two phases over eight years for $386 million, wrapping up in 2014.

It was intended to replace legacy finance, human resources, payroll and student administration systems across the department, TAFEs and 2230 public schools, based on SAP and Tribal ebs4 technology respectively.

NSW Education managed to deploy the finance software to TAFEs in 2010, and in 2013 rolled out the system to 229 pilot schools. All TAFEs were delivered the HR and payroll systems in 2013.

The student administration and learning management (SALM) rollout to the 229 pilot schools was completed in 2013 for schools and 2014 for TAFEs.

But that's where the project stalled.

The Education department and all 2230 schools are still yet to receive the HR and payroll systems, and only the 229 pilot schools are running the finance software. The remaining 2000 schools similarly still don't have the new SALM solution.

The department won't provide delivery timelines for the rollout.

The project is now almost $200 million over its original budget at $579 million, and it's likely the department will need to return to the state government to ask for more money to finish it.

Some of that money will need to go towards more dedicated training and support for staff, after Education received a significant number of complaints about schools struggling to resource the system overhaul.

The funds will also go towards remediating problems with the software deployed so far - NSW auditor Grant Hehir last year found more than 70 percent of the 229 pilot schools said the installed components did not match up to what they were promised.

NSW Education late last week put out a call for cloud-based services and solutions to support training of the remaining 2000 schools prior to the rollout of its SALM solution. It plans to conduct the training through virtual classrooms.

Tender documents reveal the new third stage of the LMBR project will deliver the SAP finance, SALM and HR/payroll software to the remaining schools next year.

First up will be the deployment of the SALM and finance solution to the 2000 schools, and the second workstream will finalise configuration and testing of the HR/payroll solution, before the system is deployed. 

Training for the 2000 schools will commence early next year, the documents reveal, and will be delivered in groups of 30. 

The department is yet to put a timeline - or final cost - on the project.

Premier Mike Baird last week said the "expectation" was the remainder of the LMBR would be implemented throughout 2016 - ten years after the project was originally signed off.

"Yes, the LMBR project has had its challenges. We acknowledge that. We have put in place new governance arrangements, which have made progress. It is rolled out to the TAFE system. It is working across a number of pilot schools," Baird told NSW parliament.

"Obviously this is a significant program that brings its own complexities. It is not an easy project to roll out. But we are doing everything we can to get it out as quickly as possible to make as much difference as we can to the schools in this state."

Education Minister Adrian Piccoli admitted school staff had been struggling through the LMBR reform.

"Always when there is a significant change in the administration of an organisation there are going to be people who find the change challenging," he said last week.

"That is the reality of changing something for the first time in 30 years. Part of the technical challenge has been that this organisation, one of the biggest in the country, has 100,000 staff."

Piccoli said the department was within Treasury limits for the capital costs of the project, but did not comment on how much it was expected to cost once complete.

Where did it go wrong?

The major causes of the cost increases and delays to the program centred on changing requirements and scope, a "high level" of uncertainty in business cases, governance weakness, and lack of program and contract management.

These were the findings of NSW auditor Grant Hehir late last year.

He pointed out that, among other issues, the department had failed to include risk management and mitigation into its expense projections - nor did it consider the $4.9 million spent on accommodating travelling LMBR staff.

Hehir uncovered a revolving door of program leaders, as well as extra payments for interim timetabling software because the SAP solution lacked the function.

Change management was inadequate, and the department did not always have the right skills in place to oversee project governance, the auditor found.

"The LMBR program has faced all the inherent difficulties expected in trying to manage a large-scale, long-term, and complex program with diverse business requirements and complex commercial arrangements," Hehir wrote at the time.

"We found that the department is not adequately managing these significant issues."