Someone's finally taking on £10M Hull City Council ERP deal to replace Oracle

More than two and a half years after it began talking to vendors, a city council in northern England has awarded a contract to Workday for £10.7 million ($14 million) to create a finance and HR system that will replace the ageing Oracle ERP installation.

Unitary authority Hull City Council awarded the contract for seven years with an option to extend for an additional three years, according to a contract notice. The deal includes software as a service and implementation services, which amount to £3.1 million ($4 million), the council said.

The four suppliers bidding for the contract had already qualified for a Crown Commercial Service Back Office Software framework worth up to £1.2 billion ($1.56 billion), after encouraging suppliers to submit expressions of interest in February.

A spokesperson for Hull City Council said: "It's important that the Council has a fit-for-purpose, workable and cost-effective IT system. Workday will provide a platform to help the Council run the basics such as HR, payroll, finance, and procurement."

With the new software, the Council is expecting to accrue an estimated £1 million ($1.3 million) digital efficiency saving each year starting from 2026/27.

According to a report presented to the council's cabinet in December 2021, Oracle EBS has been used by the authority since 2002 and has needed "several key upgrades during this period to ensure it remains compliant which is costly and resource heavy for the authority."

"Oracle EBS is currently supported by a third-party provider, whom the authority moved to in 2016 following an open tender procurement," the documents said. "This expires in June 2024 beyond which the authority will have no support for its key line business system without further procurement."

When the council moved to third party support, it was no longer able to upgrade Oracle EBS from the current version, R12. "As time goes on there is an increased risk regarding security and compatibility issues," the 2021 document added.

In February 2022, the council launched procurement for SaaS-based ERP system to replace the Oracle incumbent in a deal set to be worth up to £6 million.

The latest tender document confirmed the ageing Oracle ERP system links with other 40 internal and external systems including software for benefits payments, foster carer payments, and housing rent.

However, in November 2022, that procurement was abandoned, according to an official notice.

An August 2024 notice from the council said it made the decision to replace the Oracle ERP system in December 2021 but added:

"Due to the complexity and large scope of the procurement, an extensive period of soft market testing has taken place to ensure the most effective route to market was identified and to ensure the specification requirements were refined to ensure the Authority selects the most advantageous software."

The delay in the procurement came at a cost. Another notice signed in June said the council had extended support and maintenance of the Oracle E Business Suite, Browser Proxy Solution and Advanced Database Security to the existing support provider Rimini Street for a period of two years at a cost of £450,777 (c $590k) with an option to extend up to a further year.

Perhaps it will be a price worth paying: a number of UK councils, including Surrey, West Sussex, and Birmingham City Council, have experienced delays, disruption and ballooning costs during their ERP replacement projects. Taking the time to get it right may be no bad thing. ®