Birmingham's $125M 'Oracle Disaster' Blamed on Poor IT Project Management

It was "a catastrophic IT failure," writes Computer Weekly. It was nearly two years ago that Birmingham City Council, the largest local authority in Europe, "declared itself in financial distress" - effectively declaring bankruptcy - after the costs on an Oracle project costs ballooned from $25 million to around $125.5 million. But Computer Weekly's investigation finds signs that the program board and its manager wanted to go live in April of 2022 "regardless of the state of the build, the level of testing undertaken and challenges faced by those working on the programme." One manager's notes "reveal concerns that the program manager and steering committee could not be swayed, which meant the system went live despite having known flaws."Computer Weekly has seen notes from a manager at BCC highlighting a number of discrepancies in the Birmingham City Council report to cabinet published in June 2023, 14 months after the Oracle system went into production. The report stated that some critical elements of the Oracle system were not functioning adequately, impacting day-to-day operations. The manager's comments reveal that this flaw in the implementation of the Oracle software was known before the system went live in April 2022... An insider at Birmingham City Council who has been closely involved in the project told Computer Weekly it went live "despite all the warnings telling them it wouldn't work".... Since going live, the Oracle system effectively scrambled financial data, which meant the council had no clear picture of its overall finances. The insider said that by January 2023, Birmingham City Council could not produce an accurate account of its spending and budget for the next financial year: "There's no way that we could do our year-end accounts because the system didn't work." A June 2023 report to cabinet "stated that due to issues with the council's bank reconciliation system, a significant number of transactions had to be manually allocated to accounts rather than automatically via the Oracle system," according to the article. But Computer Weekly has seen a 2019 presentation slide deck showing the council was already aware that Oracle's out-of-the-box bank reconciliation system "did not handle mixed debtor/non-debtor bank files. The workaround suggested was either a lot of manual intervention or a platform as a service (PaaS) offering from Evosys, the Oracle implementation partner contracted by BCC to build the new IT system." The article ultimately concludes that "project management failures over a number of years contributed to the IT failure."

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