Tasmania’s Department of Health and Human Services (DHHS) has saved hundreds of thousands of dollars by using technology to upgrade its enterprise software in-house rather than spend vital funds engaging costly external IT consultants.
In the 2011/2012 financial year DHHS – Tasmania’s largest government agency which delivers services through 300 health-related facilities –needed to achieve $100 million in savings within a $1.8 billion budget.
It also needed to decentralise its operations by establishing three regional statutory authorities called Tasmanian Health Organisations as part of the National Health Reform agreement.
The DHHS investigated numerous ways it could cut costs by using a range of additional software modules that were available for its existing enterprise resource planning (ERP) system, to complete work that was previously outsourced.
The department has used the TechnologyOne ERP suite since 1995 and simply added new tools as required.
However, the recent signing of an enterprise licence agreement for modules such as customer relationship management, contracts and grant management, has enabled the department to complete upgrades and change configurations without needing to employ a third-party.
The DHHS achieved significant savings in several areas. During its cost cutting audit, the department realised it could import data from its external payroll system – used to process 13,000 payslips – into the TechnologyOne Financials system, format this data into PDFs and send them out.
“This cost us nothing but time and effort and it immediately saved us $100,000 a year,” said Jim Waugh, manager, business systems at DHHS.
The department has used software to create its own contracts repository, which is expected to save a further $50,000 to $100,000 per year. It also developed a grants system to manage funds it allocates to non-government organisations that provide services to the community.
“We had documents sitting in drawers and on desks, but now we can track them all electronically,” said Waugh. “Soon we will be able to administer grants for a wide range of services within the private and non-government sectors in a full and auditable process, and offer online access for recipients and agency employees.
“Instead of going through a whole business requirements specification process with costly external advice for the contracts repository, we mapped it out internally and brought a consultant in at the end to make sure we had covered everything.”
Waugh said that the department had met its savings targets by “taking things as far as we could in-house before hiring consultants.”
For example, the department’s business systems team had only a couple of weeks to upgrade and rewrite large parts of its financial system while managing the end of its 2011/12 financial year.
The change required multiple new ledgers and charts to facilitate activity-based funding requirements, daily reconciliation and transfers between different bank accounts. Stationery generated by the system had to be updated, multiple interfaces altered and purchasing redesigned.
The team managed this complex transition at the busiest time of the year with just one external consultant, who was used for 20 days.
Plan to create shared services
Every government agency in Tasmania uses the TechnologyOne platform under a whole of government agreement.
According to Waugh, the DHHS often receives calls from other department to provide assistance around various aspects of the software, although agencies “tend to do their own thing.”
He added that there are now opportunities for DHHS to move to a shared services arrangement for enterprise software for its local hospitals.
“I’d like to extend that out across the other agencies as well seeing as we are all using the same software,” he said.
These agencies include the Department of Education Tasmania, the Department of Infrastructure Energy and Resources.
“There are about seven or eight [departments],” he said. “TechnologyOne is also used by the majority of local councils across Tasmania – they have a different need to us but we do have calls come in from different councils to look at the way we are using our asset system.”
“The University of Tasmania use the software differently but there are a lot of things we can leverage off,” he said.
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