By RON AIKEN

Budgets “inaccurate,” invoices piling up, federal funds jeopardized

A new, $34.8 million dollar campus-wide computer system the University of South Carolina launched last year has prevented officials across the USC system from seeing accurate budgets or paying mounting invoices since July 1, multiple sources in various departments have confirmed to The Nerve.

The financial software, called PeopleSoft by Oracle, took effect at the beginning of the fiscal year and almost immediately began to have problems. Eight months later the situation is so dire, one employee with financial responsibilities who spoke only on condition of anonymity said that he and many others have yet to see an accurate budget under the new system and have had to hand-track expenditures and receipts.

“I have a budget in the millions of dollars, and I’ve been reduced to back-of-the-envelope accounting,” he said. “I’m using a ledger from Office Depot. It’s horribly frustrating.

“How can I take on a new expense or fix something that breaks when I’m guesstimating how much money is in our account or whether deposits have come through? And I’m one of the smaller departments.”

He said other, larger departments have experienced the same problem and that the problems are university-wide.

“I talked to a department head in Arts & Sciences and he has hundreds of accounts, something like an $18 million-dollar budget and he hasn’t had supplies delivered since June,” he said.

That same employee recently tried to order a new laptop for his office from Dell but the Dell representative denied his request due to the fact that “numerous invoices were unpaid and (new) orders were not being filled until USC caught up on its bills.”

“PEOPLE ARE CRYING AT THEIR DESKS”

With a $1.4 billion budget, more than 6,000 employees across 103 separate offices in 12 divisions on the administrative side and 15 individual colleges accommodating 33,709 students in Columbia (49,449 across eight statewide campuses), the scale of the problem is massive and affects every aspect of the university, sources say.

“The system just fell completely apart so quickly that I don’t think they have the resources truly to deal with it across the entire campus,” the source said. “There were so many problems so quickly in so many places. It’s just been a snowball effect with invoices not being paid, old vendors having to be hand-added to the new system one by one then getting lost, late fees accumulating everywhere, connectivity problems, error messages not allowing the completion of purchase orders…it’s hard to believe something like this can happen at a major university.”

At a Tuesday morning gathering of approximately 50 grant-writing professionals from multiple USC departments, the Q&A session that followed an update of changes to federal requirements quickly became a PeopleSoft gripe session.

Addressing Tommy Coggins and Gayle Haddox of USC’s Office of Research, which sponsored the breakfast, campus administrators did not hide their frustration.

“I told my (principal investigator) to stop using the system,” one administrator said flatly. “I told my people ‘We’re not using this thing until they fix it.’ The expenditures are all wrong. You can’t get a report properly and the numbers are incorrect. There’s no point even looking at them.”

Others said though they thought the old system worked well, they weren’t put off by the challenge of a new system.

“It’s not as if we’re grumpy old poops who don’t like change,” said another woman. “It’s that this system doesn’t work.”

“The best I can do now to see my budget is to use three different systems just to get a ‘sort of’,” a man at a nearby table added. “I can’t produce accurate monthly financial reports that way. That’s a problem.”

Standing up to field questions from the room, Coggins said he could offer no solutions because his office was in the same boat as everyone else.

“We’re users, like y’all,” said Coggins, director of the Sponsored Awards Management department that administered $243 million in grants in FY 2015-16. “We have issues every single day with financial reports, with invoices, with payments. It’s a mess, and you can’t trust it.”

Coggins was asked if school president Harris Pastides was aware of the scope of the problem.

“There’s no way (USC leaders) don’t know it,” he said. “They know it’s a big problem. Everybody knows.”

Haddox, the sponsored awards training coordinator, said she sympathized with the group’s issues.

“We can all agree that PeopleSoft is frustrating,” she said. “We’re in the trenches with you.”

When asked if he were as concerned as the rest of the room that potentially millions of dollars of federal grant funding were at risk, Coggins said yes.

“We’re very worried that all our federal billing going out is wrong,” he said. “We’re raising the flag (to the administration) all the time. We’re beating the drum.”

One administrator in the College of Arts & Sciences who spoke to The Nerve after the meeting but who did not wish to be identified for fear of losing her job was candid about the impact PeopleSoft’s problems were having on university morale.

“People are crying at their desks,” she said. “I’m not kidding. People are crying, people are leaving, people are retiring early.

“Can you imagine running a business for nine months with no accounting system? That gets old pretty quick. Our old one wasn’t broken and was brilliantly designed in-house. Someone was sold a bill of goods with this product. And with all the late fees that are adding up across campus, who’s going to pay those? Nobody budgeted for that.”

NO HELP FROM THE HELPERS

A nearly universal complaint was that the university’s technical resources to help have been so swamped as to be nearly ineffective.

“They won’t answer their phones when I call,” a woman said.

“I wouldn’t, either,” Coggins replied.

“No one from PeopleSoft or technical support answers their phones or returns your calls,” a longtime administrator in the College of Arts and Sciences said. “In fact technical support now just says ‘We have nothing to do with PeopleSoft.’”

Speaking to The Nerve by phone, a business manager from a satellite campus said that similar promises of fixes and help have been broken over and over.

“There was a big meeting held in September of business managers from around the whole university, a big roundtable discussion where everyone came with their issues,” he said. “There were just a myriad of them presented that were all serious in nature.

“We were told all the questions would be accumulated and answers given in an email to be sent out later, but we never heard anything. That’s been the standard reply – nothing.

“The last email we got campus-wide was that a big chunk of the vendors who had been entered by hand had fallen out of the system or disappeared, that they were working on it and that there was no timetable for a fix.”

Such problems stand in contrast, the arts administrator said, to rhetoric from the PeopleSoft representatives who pitched the product in training sessions with the school’s various colleges.

“The representatives from PeopleSoft who met with us for training said they’d be here and come to your desks individually to help you if you had any problems at all,” she said. “Well, those people are nowhere to be found now.

“Maybe they left after the check cleared.”

A TROUBLED HISTORY

In 2008, Montclair State University, a 20,000-student public research university, spent approximately $20 million to launch PeopleSoft across its campus system in New Jersey.

Three years later they were in court.

“Oracle failed to deliver key implementation services, caused critical deadlines to be missed, refused to make available computer resources that it had promised, failed to deliver properly tested software, and, overall, failed to manage properly the project,” the 2011 breach-of-contract lawsuit alleged. According to that suit, the cost of Oracle’s mistakes and lack of a functioning computer system in three year’s time had added an additional $10 million to the bill.

The suit also alleged that when Oracle contractors were unsatisfied with Montclair’s administrative attempts to negotiate-down the extra costs and timetables for fixes, they walked off the job.

“Oracle’s staff returned to the university’s chief information officer’s office, handed the chief information officer the access keys and said, ‘Here you go’ and ‘We’re out of here.’”

That lawsuit settled out of court, terms undisclosed, in 2013 – the same year USC signed its five-year deal.

Other universities have had similar issues. Oracle settled a claim with Cleveland State for $4.5 million in 2005, and problems have surfaced in published reports with North Dakota University and Florida A&M. As far back as 1999 chancellors, provosts and top officials from seven Big Ten schools – Minnesota, Northwestern, Ohio State, Wisconsin, Michigan, Indiana and Iowa – combined to draft a letter of concern to then-PeopleSoft president and CEO Craig Conway.

“PeopleSoft products have an enormous impact on a significant proportion of the faculty and students who are served by your systems,” said the letter dated Nov. 22, 1999. “Our institutions represent approximately 1,600 departments and 250 colleges; many of them ranked among the top ten nationally. We have approximately 35,000 faculty and well over half a million students. As a consequence, problems with PeopleSoft escalate quickly and dramatically.”

“The performance of the systems, in terms of responsiveness, is simply unacceptable. The performance is especially poor on large batch programs such as tuition calculation, which for some of us ran for six days. We are spending an enormous amount of time and money simply getting the software ready to work at our schools. And as a consequence, we are missing

business events and/or having to put in place expensive contingencies and workarounds that inevitably leave our customers and staff unhappy with PeopleSoft.”

AN $8 MILLION GORILLA

According to the contract with PeopleSoft obtained through the Freedom of Information Act, USC purchased the financial software in October 2013 for $3.05 million initially with an overall contract value of $34.8 million including implementation through 2014.

The finance component is not the only system-wide software contract USC has with PeopleSoft. A human resource component that was scheduled to debut with the financial system has faced delay after delay and still is on hold.

These initiatives are a part of “OneCarolina,” which is described as the “University of South Carolina’s multi-year project to modernize, streamline, and enhance academic and administrative services. This Project will create an integrated digital community linking the University’s eight campuses. It strives to support the University’s primary mission as a multi-campus public institution serving South Carolina’s learners, educators, and community.”

The scope of OneCarolina is immense, covering every significant aspect of USC’s operations across its eight-campus system. It’s digital implementation has been gradual since 2012 and broken into modules. The admissions, financial aid and student services (registration and fee payment) components already have been rolled out successfully using Ellucian Banner software. Only the PeopleSoft products have created problems.

What happens next? More of the same, insiders say.

“As far as I can tell they’re just throwing more consultants at it,” Coggins told the room of grant writers. “They’ve gone too far and spent too much money to back out now and turn it off. I don’t think that’s an option.

“I don’t see them getting rid of it. They’re not going to stop.”

“It’s the gorilla in the room (at USC),” Haddox added.

In response to The Nerve’s questions Tuesday, USC spokesperson Wes Hickman said patience is key in any transition.

“There have been hiccups as well as the frustrations and growing pains that inevitably result from change and progress,” Hickman wrote. “We are working to address those and expect to be fully stabilized by the end of the fiscal year.”

“PeopleSoft replaces dozens of individual, personalized, decades-old software programs in finance, purchasing and budget that didn’t communicate across the system. Therefore implementation is not easy and training hundreds of employees takes time, patience and a commitment to learn.”

For seasoned professionals across the USC system, that patience is wearing thin.

“(PeopleSoft is) a punchline,” one grant administrator from a satellite campus said Tuesday. “We’ve totally lost confidence in this system.”

Reach Aiken at (803) 200-8809 or email him at ron@thenerve.org. Follow him on Twitter @RonAiken and @TheNerveSC. Sign up for instant email alerts using the button at the top of the page.