Critical Analysis Report: Queensland Health Payroll System IT Failure

This critical analysis report examines the Queensland Health payroll system IT failure, a major project failure in the Southern Hemisphere. The report delves into the reasons behind the failure, including unwarranted urgency, lack of diligence, inappropriate scoping, and underestimated project complexity by IBM. It analyzes the control systems in place, such as LATTICE and SAP, and their shortcomings. The analysis further explores the project's execution, the responsibilities of the project team, and the relationship between identified problems and stakeholder needs. The report concludes with recommendations for better project control, including the utilization of appropriate implementation strategies, rigorous testing, and effective stakeholder communication. This analysis provides valuable insights into the complexities of IT project management and the importance of robust control systems.

STUDENT NAME
STUDENT ID
CRITICAL ANALYSIS REPORT
IT FAILURE WITH THE
QUEENSLAND
HEALTH PAYROLL SYSTEM

INTRODUCTION
• Analysis of the Queensland Health payroll system
• The incident tremendous financial pressure and losses
• Largest admitted IT Project Failure in the Southern Hemisphere

REASONS BEHIND FAILURE
• Sense of urgency which was quite unwarranted on the parts of government officials
• Lack of diligence in the officials of the state government
• Inappropriate approach towards the scoping of interim solution
• Improper timeframe suggestions from government officials
• Huge number of awards to be attended by IBM while on the project
• Underestimated approach by IBM towards the project regarding the work to be
performed and the time allocated
• Signing off change requests by the government officials or CorpTech without addressing
the fact that timeframe was not sufficient to attend all (Thite 2014).

CONTROL SYSTEMS
• Government departments and agencies
• Government owned corporations
• General statutory bodies
• LATTICE and ESP roster engine were put to use to keep the disparate payroll structure orderly.
• LATTICE system went obsolete in 2005 and was ceased from being functional by the vendor
Talent2 due to its inability to keep up with the updated technology in use (Belbin 2012)
• From 2003 all state government departments had to enable themselves with SAP HR or SAP
Finance
• SSI further established Corp.Tech

CONTD…
• Logica, IBM, SAP and Accenture responded from whom the Corp.Tech required
detailed proposals within July 25, 2007.
• RFI that Corp.Tech opted for turned out to be costly venture
• IBM utilized Work brain roistering system for staff member rostering and award
interpretation
• Queensland Health opted for SSI to substitute the obsolete LATTICE programmed
• The Corp.Tech and IBM substituted their systems with SAP HR, SAP Finance and
Work brain roistering system

ANALYSIS OF THE REASONS
• The state of Queensland and IBM Australia had a contract between them of $6.19 million
• Objective for this was to replace the QLD Health payroll system
• Whole incident resulted in a situation that is contradictory to this notion
• Led to the payroll anomalies of over 35,000 in number
• Taxpayers of the country also had to bear the burden of additional $ 1.25 billion
• The QLD Health payroll project was handed over to IBM from December, 2007
• Implementation of a standardized HR based on SAP
• The Queensland Treasury went into hiring
• From a large number of contractors, the treasury hired consulting companies such as SAP, Logica, IBM
and Accenture

CONTD…
• The ‘burning through the budget’ term was applied in this regard
• The business unit of the Treasury, duly known as the Corp.Tech, chose IBM as the prime
contractor
• State departments did not seem to be inclined toward the new system’s implementation
• Treasury business wing Corp.Tech had its personnel Darrin Bond
• The Queensland Health had been using an age-old system of LATTICE
• It was supposed to receive the SAP based system in the year of 2006
• The contract with the LATTICE supplier was over in July 2008 for which reason the
decision to involve CorpTech in Queensland Health payroll system was taken

ANALYSIS OF THE EXTENT TO WHICH THE PROJECT EXECUTION
TEAM COULD BE HELD RESPONSIBLE
• The payroll system was determined at $ 6.19 million for both designing and implementation
• The payroll system consisted of award structures which were considerably complex in nature.
• In addition to it there were industrial agreements which were also multiple in number and were included in
the payroll system
• The employees were almost 80,000 in number
• Queensland Health, IBM and CorpTech agreed upon tackling all these included in the payroll project (Dean
2011)
• The management took the project lightly and, in all probabilities, underestimated it.
• IBM was already containing a relationship with QLD Health
• The delay resulted in an increase in the bill and the final bill piled up to a whooping amount of $ 101
million

ANALYSIS OF RELATIONSHIP BETWEEN THE PROBLEMS
IDENTIFIED AND STAKEHOLDERS’ NEEDS AND INFLUENCE
• Mater hospital is a privately-run health care facility
• It also opted for a payroll project that was quite similar to the one aimed to be implemented by the QLD
health
• But that project was spanned over twelve months for identifying the scope.
• The time frame for the execution for the project roll out was huge in comparison to the one of QLD health
• Queensland Health project began to crumble under the Himalayan pressure
• The whole process of the project payroll was delayed which was a result of mutual agreement of both QLD
Health and the IBM
• Another step on the government’s part was lowering the bar for the project contractor IBM too implement
testing phase
• The incidence caused the state to bear an excess financial burden also which was around 400 million AUD

RECOMMENDATIONS FOR BETTER CONTROLLING OF PROJECT
• An appropriate implementation strategy should be utilized
• Before flagging off and going live a considerable amount of testing
must be performed
• A project management methodology must be utilized which would be
appropriate
• Active and effective communication with the stakeholders must be
performed for better understanding of the organizational goals (Murray
2010)
• The requirements of the organization regarding the project should be
articulated clearly

REFERENCES
• Belbin, C, Erwee, R & Wiesner, R 2012, ‘Employee perceptions of workforce retention
strategies in a health system’, Journal of Management & Organization.
• Dean, TP, DeHority, RE, DeHority, JM & Chamberlain, WW, eMars Inc, 2011, System
and method for coordinating the collection, analysis and storage of payroll
information provided to government agencies by government contractors, U.S.
Patent
• Murray, PN, PN & AJ Murray Pty Ltd, 2010. Accounting system, U.S.
• Thite, M & Sandhu, K 2014, ‘Where is My Pay? Critical Success Factors of a Payroll
System–A System Life Cycle Approach’, Australasian Journal of Information Systems.