In 2006, the Texas Comptroller denounced consulting firm Accenture’s mishandling of Texas welfare, Medicaid enrollments and the Children’s Health Insurance Program. Instead of saving the state money as the company had promised, Accenture cost the state $99.9 million more than their budget had allowed. Because of Accenture’s shoddy work, families in need were wrongly denied food stamps, many health insurance applications were mistakenly faxed to a warehouse in Seattle and 81,504 children lost health insurance coverage in just 9 months — some of them seriously ill. The State of Texas has since terminated its contract with Accenture, but not before paying $243 million for these horrors.
Now some students worry about Accenture’s plans to transform UT in the form of the University’s new Shared Services plan, which will begin being implemented this semester and which was planned with the help of Accenture.
In 2011, the chief executive of Accenture’s Health and Public Service, Stephen Rohleder, published an op-ed in the Austin American-Statesman in which he argued that public institutions, such as UT-Austin, should adopt shared services practices from the private sector. Rohleder worked with Accenture for 30 years, several of them as a chief operating officer at the company.
Months later, Rohleder chaired a committee advising UT on business productivity. UT paid Accenture staff $960,000, without competitive bidding, meaning that no other companies were given a chance to compete for the contract. A subcommittee chaired by Stephan James recommended that UT’s operations be centralized into shared services in the process, eliminating hundreds of jobs. James, too, was an Accenture executive, for 38 years, and another chief operating officer.
Given Accenture’s past history, some faculty and students voiced concerns about the company’s involvement in the initiative last semester.
UT’s Chief Financial Officer Kevin Hegarty replied, “Shared Services at UT is not an Accenture-driven project.” At a faculty meeting, Hegarty also admitted, “If it’s an Accenture plan, it’s not going to be successful.”
But even after the original proposal was finished, Accenture’s involvement on the UT campus continues. The project team tasked with creating the UT Shared Services plan has six leaders, including three Accenture executives, Tim Mould, Ryan Oakes, Jamie Wills, plus a former Accenture executive, Brad Englert, now the University’s chief information officer.
To implement the Shared Services plan, administrators will have to buy a “hugely expensive” system called Workday for more than $100 million. Workday publicizes its Services Partners, and its first partner is Accenture — despite the fact that Workday does not list its partners in alphabetical order. Accenture even describes itself as “one of Workday’s most strategic, experienced and successful deployment partners,” further underscoring the relationship between the company and Workday.
Englert will oversee the implementation of Workday. Julienne VanDerZiel, another Shared Services planning leader, is also a former Accenture executive.
It remains to be seen how their experience at Accenture will affect the University.
Accenture developed shared services for the University of Michigan. At a meeting of UT’s Staff Council, Hegarty explained the importance of Michigan’s Shared Services as a model for implementing the system at UT: “They’re probably the closest institution to us of any out there. They’re about the same size, the same scope, everything. And so we think: That’s really a good test case to look at, watch and monitor …. They look very, very much like we look when you look at how they’re organized.”
And what does shared services look like at Michigan? It looks like Michigan has paid $22.5 million for Accenture’s shared services to cut 50 staff jobs and relocate 275 jobs out of other departments. Longtime employees must reapply for jobs, which they might lose. Department chairs received “an unprecedented gag order” not to discuss shared services. An investigative committee of alumni and students concluded that Accenture “cannot be trusted with the University of Michigan’s financial management, its IT systems or with other sensitive information.” They begged for the vice president of finance, a former Accenture executive, to be replaced immediately to avoid conflict of interests.
Michigan’s IT Governance Council complained that Accenture underestimated costs and overestimated savings. Finally, scores of Michigan professors denounced shared services as “a misguided venture that will irreparably harm our cherished institution.” An unprecedented 1,169 faculty have signed a petition, including the chairs of 29 departments. They begged their president to terminate the project immediately: “We implore you to restore sanity to the University.”
But UT, which has just begun the implementation of the Shared Services plan on campus, can prevent a similar crisis before it begins at home. I urge that instead of paying companies in California, Ireland and Bermuda through Accenture, UT should hire UT staff and Texas programmers to custom build its administrative systems.
Alberto A. Martinez is a member of the UT Faculty Council, and an associate professor in the department of history.