Beyond Replacement

Rethinking System Transformation in Local Government

Background

Transforming core business systems to a 21^st century standard is essential for delivering exceptional operational and service excellence. However, the success of these projects depends not just on the technology chosen but on the critical questions asked at the beginning of the process.

Too often, organisations focus on finding a new system or vendor to replace their current one, driven by brand names within a defined ecosystem rather than by addressing the underlying issues. This approach risks merely replicating existing inefficiencies within a new system instead of achieving the full potential of a transformative change.

Even when procurement processes are meticulously followed—especially in the public sector, where they are subject to rigorous scrutiny—the outcomes can still fall strategically short. Organisations may run a two-part process, provide high-level requirements, receive an adequate quota of market responses, independently score responses, and meet spending thresholds.

Yet, a year later, they might still find themselves wondering, "How did we end up with a solution that doesn't meet our strategic needs?" Or more commonly, “Why is this project failing?”.

This situation shows that asking the right questions from the start is crucial to ensure that, if meaningful, long-lasting improvements are the goal, the chosen solution won't just result in a superficial change.

Essential Points

Local governments in Australia provide a clear example of this challenge, though it’s not unique to them. It has become increasingly common for councils to consider the complete replacement of one vendor's system with another—switching from one well-known provider to another in a cycle repeated across the country that doesn't always address underlying issues.

This approach is fundamentally flawed because it asks the wrong question. It overlooks a crucial reality: a single vendor solution is not the same as a single technology system.  

Proven time and again, the confluence of one with the other is marketing sleight of hand which has fairly successfully created the illusion that a brand name alone can solve all problems. It mistakenly equates a vendor's brand with a complete, cohesive technology system. Choosing the “right brand” will not automatically solve all problems.

A solution from a software vendor is not a single, unified system but rather a collection of multiple distinct technology systems and assets, each handling different functions like Financial Management, HR, Payroll, Asset Management, and more.

Even within these systems, there's a layer of abstraction that hides the complexity and intricate relationships between various functions, sub-functions, workflows, and processes. This abstraction can make it difficult for senior decision makers to fully understand how these systems interact and what it takes for them to truly operate together.

So, when councils purchase a solution based primarily on the idea of a single vendor providing everything, the likelihood of successfully achieving a meaningful business transformation is significantly diminished. They may not fully grasp what they are implementing, leading to a lower probability of effectively transforming their business operations. In essence, relying on a single vendor solution often means missing the nuances necessary for true transformation. But it is also an example of devolved responsibility.

One reason this has played out in the local government sector is that, unlike other levels of government and many industries, city governments largely bypassed the mainframe era.

During this era, organisations dealt with the complexities of building, managing, and maintaining highly integrated and custom-developed systems. These systems required extensive technical expertise to ensure they functioned seamlessly across departments, providing those organisations with a deep understanding of large-scale system management and application development.

Local governments, however, did not engage with mainframes on the same scale and missed out on the foundational experience of managing complex, interdependent systems. This lack of exposure has resulted in a gap in technical depth and strategic understanding when it comes to managing modern IT application and information environments.

As a result, when councils approach system transformations today, they often do so without the benefit of this technical legacy. This makes them more susceptible to oversimplified solutions, such as the wholesale replacement of one vendor’s solution with another, under the mistaken belief that this will resolve their challenges.

This approach overlooks the need for a nuanced understanding of process management, system integration, customisation, and the long-term strategic implications of their technology choices.

Without the deep technical experience that comes from managing complex systems, local governments are at a disadvantage, often defaulting to decisions that seem straightforward but fail to address the underlying complexities of their operational needs.

To achieve meaningful, lasting transformation, local governments must move beyond brand-focused thinking and ask more strategic questions that address the actual needs and complexities of their systems. This shift in perspective is essential for transforming Australia’s councils in a way that not only replaces existing technology but fundamentally improves how the business operates.

In other words, the right questions set the stage for a transformation that creates a "new normal" for the organisation—one that is better aligned with long-term goals, more efficient, and adaptable to future needs.

My Take

Councils that approach system transformations as strategic opportunities to redefine how they operate—and start by asking the right questions—are far more likely to see their investments lead to meaningful, lasting change.

The right questions today are more targeted and lay the foundation for a transformation that doesn’t just replace existing systems but fundamentally improves the way the business functions, establishing a new standard for 21st-century operations.

Councils could greatly benefit from moving away from relying on a familiar list of software providers and instead investing more in traditional systems thinking and decision making.

The real answers to real problems lie in a more thorough critique of functions and processes, deep under the abstraction layer of most marketing-led sales proposals. Focusing on strategic choices, free of brand pressure from the executive office, they can dramatically reshape the solutions landscape and deliver more meaningful and effective projects.