Queensland Health payroll woes provide lessons on shared services

by 16 Jul 2010

Poor application of shared services was to blame for Queensland Health’s much maligned payroll debacle, according to corporate advisory firm Ovum.

Payroll has been one of the key processes targeted for automation for more than 40 years, and there is no shortage now of robust packaged software solutions aimed at the HR/finance market sector, it said.

But Kevin Noonan, research director at Ovum, said that while generic solutions are abundant, there are still hidden challenges in delivering solutions that meet specific business requirements.

He pointed towards Queensland Health’s 13 different industrial awards and multiple industrial agreements, providing over 200 different allowances to its employees and the current award structure that leads to more than 24,000 different pay combinations to be calculated.

“Scope creep can become the deadly enemy of such projects, particularly where there are complex employment conditions to consider. This was certainly the case for Queensland Health’s payroll system,” he said.

“Shared services is certainly the flavour of the moment across Australian governments. This is a sensible step given the significant potential savings in management and infrastructure costs, as well as the extra benefits in delivering coordinated services across agencies.”

“However, things can go disastrously wrong if additional governance arrangements are not put in place to deal with the new leadership dynamic. Competing interests need to be managed between new stakeholder groups.”


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