In what’s become an all-too-familiar story for taxpayer funded technology projects, another Washington state IT upgrade is falling further behind schedule and over budget.
The state’s Office of Financial Management last week again postponed ambitious plans to move dozens of state systems, for everything from driver licensing fees to foster care payments to state pension checks, onto a cloud-based platform called Workday.
The massive project, dubbed One Washington and initially set to launch its first phase in mid 2022, had already been pushed back to July 2025. Now, it won’t go live until July 2026 at the earliest, and possibly not until January 2027.
Project costs, which had already jumped from the original estimate of $144 million for the first phase to around $291 million, are also expected to rise again — unwelcome news as the state faces a $10 billion to $12 billion shortfall over the next four years.
OFM said it won’t know how much by until next month, but the numbers could be large.
A draft budget request by OFM in September asked for $501 million over the next four fiscal years, though that figure includes subsequent phases of the Workday upgrade as well as expenditures that were planned for earlier in the project but have been delayed.
OFM postponed the first phase of One Washington after tests showed that more than a third of 113 affected state agencies, which together handle some $43 billion in transactions a year, weren’t ready to run those financial processes via Workday.
OFM is eager to avoid problems of the kind that marred the $340 million Workday upgrade at the University of Washington, which launched last year despite concerns that it wasn’t ready.
But the One Washington delay also follows a damning “quality assurance” report issued last month by an outside consultant that flagged numerous weaknesses.
Among the findings, OFM isn’t able to closely track progress at each state agency; efforts to test the agency systems are inadequate; and OFM’s new budget request is “significantly higher than expected” and well above what some other states are spending on similar upgrades.
That’s all landing poorly with state lawmakers, who say One Washington’s repeated problems are undermining confidence in the state’s ability to execute critical but complicated IT projects.
Legislators need “some degree of surety that even with more money we can get where we need to be” on One Washington, said state Sen. Lisa Wellman, D-Mercer Island. “And I have no confidence that is the case.”
Lawmakers are especially frustrated that the problems continue despite the state’s massive outlays to Deloitte, the high-profile consultant helping run One Washington, and the state’s second biggest IT contractor.
Over the next four years alone, Deloitte could be paid around $160 million for One Washington, based on earlier estimates provided by Deloitte to OFM.
Identifying problems of the kind that have hobbled One Washington — “that is Deloitte’s job,” said state Sen. Joe Nguyen, D-West Seattle, chair of the Environment, Energy & Technology Committee and Ways & Means Committee vice-chair.
A heavy lift
To be clear, One Washington was never going to go smoothly.
Part of a broader state initiative to replace aging state technology, One Washington aims to modernize and centralize state financial processes now run on roughly 280 different computer systems, many of them decades old and costly to maintain or keep secure.
Many of those older systems will simply be replaced by Workday, a sophisticated “enterprise” platform that is used by many governments and universities.
However, around 40 state agencies plan to keep using some “legacy” computer systems, which will need extensive modification to be compatible with Workday — modifications that OFM worried wouldn’t be ready for a July 2025 launch.
Pushing back the launch by 12 to 18 months will ensure every agency is prepared “so that when Workday goes live, we don’t break things downstream,” said Amy McLean, OFM’s spokesperson for One Washington.
Breaking things is a real risk. Glitches in the University of Washington’s Workday rollout, also managed by Deloitte, led to $90 million in delayed vendor payments and disrupted the school’s vital system of federal grants, though many of those problems have since been addressed.
The stakes are far higher with One Washington, which touches crucial state operations, including payments to hundreds of thousands of Washingtonians.
Trying to “go live” with Workday before those processes were ready “would cause catastrophic failure” in crucial state operations, OFM said.
A failed launch could also affect the state’s financial accounting process and hurt its creditworthiness, according to an August report by the state auditor’s office.
OFM said one of the project’s biggest challenges has been a chronic shortage of IT staff, made worse by the pandemic, to help agencies prepare their systems. The project also suffered from extensive executive turnover in its earlier phases, McLean said.
More fundamental challenges were highlighted in last month’s quality assurance report, which was prepared by Gartner Consulting.
For example, One Washington was structured so that OFM and the various agencies operate in “parallel” to each other on the project, without sufficient interaction, which made it hard for OFM to monitor “agency progress and obstacles,” Gartner said.
Gartner also criticized procedures to test the “readiness” of the agencies’ legacy systems for Workday. In some cases, tests showed only that legacy systems could share data with Workday, but didn’t confirm whether the systems would actually be fully operational once Workday was launched.
Gartner also said One Washington’s first round of system tests yielded a success rate that was higher than Gartner typically finds in such big projects.
Moreover, when Gartner interviewed staff at various agencies, it found “an apparent mismatch of expectations as what counts as ‘passing’ a testing scenario and what counts as ‘failing,’” according to the report.
Specifically, “agencies expressed there were several occurrences during the testing process where they thought the test ‘failed’, however the test was marked as ‘passing’ or as ‘user error.’”
OFM acknowledged Gartner’s criticisms when it decided to postpone the launch. The agency said it was addressing those criticisms, but in a presentation last week noted that “while (One Washington) is working on improvements, without significant changes in these areas going forward, there is a risk that the Program will have difficulty achieving a new go-live date.”
OFM had also adopted measures to prevent a premature launch. Workday will only go live if OFM and the agencies have successfully tested modifications at 38 financial systems that have been identified essential in the shift from the current financial system to Workday.
Still, lawmakers are frustrated the state took so long to make these course corrections.
Nguyen worries Washington is now so reliant on IT contractors like Deloitte that agency managers are less and less able to oversee complicated technology projects
He also thinks OFM failed to put enough pressure on individual agencies to ensure they’re ready for Workday. “Right now, the mindset is, ‘well, we built this platform — if [agencies] don’t use it, it’s their fault,’ “ Nguyen said.
McLean, OFM spokesperson, said OFM is looking at ways to hold agencies more accountable but also to better support them with resources and personnel to make the necessary changes.
“We’re really focused on finding the right dynamic of executive accountability along with support from the program,” McLean said. “You can’t really have one without the other.”
Nguyen is glad OFM is retooling its management strategy, but he says he’ll insist on meeting personally with staff at agencies still working on legacy systems so that he can personally assess their readiness.
“That’s great they have a new date,” Nguyen said of One Washington’s 2026 launch window. But after so many problems, he adds, “I don’t believe them.”
