The Home Office is one of Whitehall’s largest departments, employing over 33,000 people, and has core responsibility for the country’s’ borders, security and citizen safety. And whilst the department is primarily focused on preparing for Brexit (whatever that looks likes), behind the scenes it has also been undertaking a huge project as central government’s pathfinder to Oracle Cloud.
Speaking at an Oracle event this week in London, Nick McGrath, the Home Office’s programme director for the pathfinder, explained how the Department has shifted finance, procurement and expenses from its on-premise Oracle system to the Oracle Cloud - with HR to follow in the coming months.
Interestingly, McGrath noted how getting to the go-live for finance, procurement and expenses (or Day 1, as McGrath and his team refer to it) was largely conducted as a waterfall project, focusing on process standardisation in the cloud. However, what he has learned over the course of the multi-year project is that the real benefits will come with adopting an agile approach to reimagining service fulfilment for users in the future (dubbed Day 2).
The Home Office embarked on the pathfinder - which may be used by other central government departments or arms-length bodies as a framework for getting to Oracle Cloud - at the back-end of 2016. The decision was made with Government Shared Services, which the Department had been contracted with, to undertake a cloud feasibility survey, to understand the Home Office’s opportunities. McGrath said:
“Given that we had previously been participating in a government programme, which had led to some delay, and we had a burning platform in terms of our legacy system, we were able to make the case for looking at the Oracle Cloud service and deciding whether or not it would meet our requirements. So we did that as a fairly standard cloud readiness assessment. We did that for 3 months.”
Following this, the decision was made that the Oracle toolset would meet the outcomes the Home Office wanted to deliver. That was approved in January 2017, contracts were then signed with Oracle, and Accenture was chosen as an implementation partner.
McGrath and his team decided to progress the project as a phased implementation in September 2017, tackling the low-hanging fruit first. He explained:
“At that time we agreed with our implementation partners was that the most sensible way to roll this out was a phased implementation, with finance, procurement and expenses going first. With HCM and payroll going second.
“A few reasons for the that - the cloud readiness assessment did reveal that in order to adopt standard business process that were available in the cloud, the business change for HR was more significant than for finance. I think, secondly, we didn’t want to slow down the rate at which we could get our finance colleagues the system they wanted, so they would have to affect that business change for HR.
“It’s meant taking some pain, because we are living now with co-existence with cloud for finance, expenses and procurement, while HR is in our legacy system.”
Day 1 vs. Day 2
The Home Office went live with finance, expenses and procurement in December 2018 - approximately 15 months after the beginning of the implementation. McGrath said that this was longer than the market of SIs had told the department it would take, but it was still quicker than anything the Home Office had done previously. He added that it was “better than we could have done in the on-prem world”, especially given the complexity of the project. McGrath said:
“We’ve got 33,000 people. We’ve got over 160 integrations in our legacy estate. We’ve got a shared service partner with whom we are in an existing contract for outsourcing, for working in a particular way. We’ve got a completely separate business intelligence data warehouse. We’ve got a variety of heavily customised self service functions. There’s a lot of work here to replace the system.”
As noted above, the Home Office has (perhaps inadvertently) adopted an approach that it refers to as ‘Day 1’ and ‘Day 2’ (go live with standard processes in the cloud versus the opportunities presented by digital user experiences and service fulfilment). McGrath explained:
“The digital engine - the Oracle UX, the PaaS, the user-centric portal - we always knew those weren’t things we would do on day one. That was always going to be too much change. But again, we were dimly aware that there was a case to be made that if you could standardise the core ERP processes, that’s what buys you the flexibility down the line to exploit the digital tools that will enable you to tailor services to different parts of your organisation. In simple terms we talk about Day 1 and Day 2.
“Day 1 is focusing on the process engine, where we have adopted the standard business processes that the Treasury and ONS had adopted before us (largely). Day 2 we started talking about our business case, because we recognised that there were going to be some things that you don’t get benefits from, the day you switch the system on.”
McGrath added that there are benefits achieved on Day 1, that there is a healthy business case. He said that there is now real-time access to data, there is improved reporting, the technology overall is cheaper - and that Day 1 has an RoI of approximately 3 years. However, McGrath is aware that most of the benefits are coming in the future, and will require a different approach (also, see image below). He said:
“But actually, a lot of the bigger benefits that we knew less about, but we were aware that probably did exist, in that service improvement, and that digital experience space - we didn’t really know enough about. We did the sensible thing in my view and said, ‘those aren’t Day 1, those are Day 2’. Other stuff has to happen before those can be realised.
“Day 1 was about the process engine, and adopted processes into our delivery model. Day 2 is where some of the benefits around improved service, becoming customer centric, providing a genuinely digital experience can come in. Because in Day 1, you have digitised your delivery model.
“By de-facto, we realised that it was complicated, effortful and expensive to get to Day 1, where we had moved away from a customised system, where user expectations were based on those customisations. But the point is that we think that largely a waterfall approach on Day 1 gives benefits that help you wash your face. We think the potential benefits of having an agile approach on Day 2, once you’ve got that toolset in place, and once you’ve adopted those standard processes, are potentially much more significant. It’s an accelerator for us getting to those Day 2 benefits.”
A focus on future service
McGrath is keen to focus on a future that asks the question - what are the types of services that the Home Office wants to be providing? What is the service fulfilment model that Oracle Cloud can actually enable you to do? He admits that this focus on the end-user is a more effective case for top-down engagement.
“We think that’s important, because it helps you articulate the case for why you’re doing it. It’s a much more compelling case than just, ‘you need to upgrade your computer system’, because you can actually speak to seniors in a way that they will understand about how services will improve. And I think that’s necessary, because there’s such a huge culture change, if we are genuinely going to improve the services our people get in HR, finance and procurement, the extent to which they’ve got to take more responsibility for their own data, for example, is significant.
“So we’ve got to tell them how services can and will improve to get that buy in. If I could have my time again, we would want to focus on service fulfilment and the link directly to benefits.”
However, unsurprisingly, there’s a capability gap that the Home Office needs to fix in order to realise these benefits - digital skills. McGrath added:
“Finally, we’ve also really got to think about skills. We don’t have very many people who have got the knowledge and skills around digital HR transformation, for example, to be able to help us understand what ‘good’ looks like.”