Making PFM Making PFM Technology Technology Work: Lessons Work: Lessons Learned Learned July 17, 2009 July 17, 2009 Doug Hadden Doug Hadden VP Products VP Products
Making PFM (Public Financial Management) Technology Work: Lessons Learned
Jan 13, 2015
Presentation made to the Cambodia Finance Conference on July 18, 2009
Addresses: issues and solutions in implementing government financial management systems in emerging countries
Doug Hadden, VP Products FreeBalance
Addresses: issues and solutions in implementing government financial management systems in emerging countries
Doug Hadden, VP Products FreeBalance
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Making PFM Making PFM Technology Work: Technology Work: Lessons LearnedLessons Learned
Making PFM Making PFM Technology Work: Technology Work: Lessons LearnedLessons Learned
July 17, 2009July 17, 2009
Doug HaddenDoug Hadden
VP ProductsVP Products
July 17, 2009July 17, 2009
Doug HaddenDoug Hadden
VP ProductsVP Products
Most Commercial Off-the-Shelf (COTS) andcustom developed financial systemsfail to achieve government goals in
Emerging Countries.
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
On Budget On Time On Time, On
Budget
Sustainable
Success Rates, IFMIS in Emerging Countries
FreeBalance Success Rates, Emerging Countries
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
On Budget On Time On Time, On
Budget
Sustainable
Under More Stressful Conditions?
World Bank Sample
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
Low Medium High Post Conflict
*
FreeBalance Customers
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
Low Medium High Post Conflict
*
Human Development Index
Why is FreeBalance so much more successful?
Low success rates in developed countries!
• 40% of enterprises exceed time and budget estimates > 50%
• ERP technology to business benefits rated D+
• 15% large implementations failed
• 51% were over budget, over schedule or under delivered.
• Half of all respondents incur additional costs after implementing financial applications
• Fewer than a third of enterprise decision makers would recommend their ERP vendor to another company
The traditional model for software development that works (sometimes) in the West
does not work for Emerging Countries.
Agenda
• What difficulties need to be overcome?• Where is the software development model
broken?• How can governments increase the
chance for success?
1. IFMIS Software takes too long to implement.
2. IFMIS Software does not adapt well to reform.
3. IFMIS Software cannot be sustained bythe government.
What Happens When Things Go Wrong?
• Blame the victim– Customer didn’t articulate business
processes properly– Customer had unrealistic expectations
for delivery– Customer changed requirements after
the first phase– Customer did not dedicate enough staff
to manage project– Customer did not train enough staff
ProductManagement
Sales &Marketing
User
Trainer
Consultant
CustomerSupport
ProductDevelopment
Typical
ProductManagement
Sales &Marketing
User
Trainer
Consultant
CustomerSupport
ProductDevelopment
Product often designed with different customers in mind
Product developers have no expertise in government financials Salespeople want to
sell to every possible market.
Consulting firms often do not have government expertise. Consulting firms may
not want system to be sustained by government.
Government needs may not go into upgrades
Consulting firms generate revenue from customization.
Government is one of many “verticals”
Typical
The FreeBalance Solution
Company Summary
FreeBalance is a global provider of software solutions for public financial management (PFM). – Canadian software company ISO-9001/2000
certified – Strong domain expertise in government financial
management, 100% focus on government– Integrated technology for budget formulation and
public expenditure management– Founded in 1984– De facto standard for fast implementations– Global presence, implemented in every World
Bank region
Customer Headquarters
FreeBalance Development
FreeBalance Support Centres
FreeBalance Offices
ProductManagement
Sales &Marketing
User
Trainer
Consultant
CustomerSupport
ProductDevelopment
Product designed with Emerging Country requirements.
Product developers understand government financials
Salespeople focused in government.
At FreeBalance, “success” is defined as sustainability.
FreeBalance provides consulting services – works as a member of all implementation teams
100% Focus on Government
Government needs ALWAYS go into upgrades
FreeBalance
Customer Centric ApproachProduct Management
Customer Support
Product Development
Consultant
UserAll problems & feature requests are tracked – management dashboard
FreeBalance consultants mentor customers to build capacity.
Developers visit customers and are part of “SWAT” teams.
International Steering Committee sets product direction.
Customers interact with FreeBalance staff and other customers on Customer Exchange
Customers visited at least once every year.
Local in-country support.
1. IFMIS Software takes too long to implement
Vendor should understand the government domain.
Product should be designed for rapid implementation – configured, not customized.
Products should be proven to implement quickly in countries with more stressful conditions.
quickest implementation26 days
Averagefirst phase8 months
2. IFMIS Software does not adapt well to reform.
All governments are reforming.Product should be designed for
progressive activation.Progressive
activation should be configured not customized.
3. IFMIS Software cannot be sustained bythe government.
Product should not place a significant burden on the government.
Vendor should know how to build capacity.
Government should not be maintaining custom code and complex technology.
Lessons Learned
Software design, implementation and support methodology critical to ensuring success
Advanced country governments have the luxury to buy expensive solutions with “nice to have” features
Governments around the world share your challenges
Some governments have more challenges
Lessons Learned• Customer didn’t articulate
business processes properly
• Customer had unrealistic expectations for delivery
• Customer changed requirements after the first phase
• Customer did not dedicate enough staff to manage project
• Customer did not train enough staff
Vendor should understand the government domain.
Product should be designed for rapid implementation.
Product should be designed for progressive activation.
Product should not place a significant burden on the government.
Vendor should know how to build capacity
help governments across the world leverage robust government financial management technology to accelerate country growth.
Our mission
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