People First or People Last? State’s antiquated HR system will put Florida behind other states and at a disadvantage in competing for talent

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The state of Florida has relied on the People First system to provide HR, payroll and benefits solutions for more than 20 years. The system is built on antiquated SAP software. SAP is a German, multinational company known more for products that support manufacturing rather than state governments.

There is widespread consensus among state agencies that the system has outlived its useful life and it’s time to move to cloud computing to reduce costs, improve HR process efficiency and protect the state’s employee data with modern cybersecurity controls.

Several other states have either modernized in the cloud or are in the process of doing so, such as Georgia, Idaho, Illinois, Michigan, Maryland, Missouri, Nebraska, Oklahoma and Washington. Department of Management Services Secretary Pedro Allende testified in December at a hearing of the House Administration & Technology Appropriations Subcommittee, that a “competitive procurement will help us deliver the best value to the state.”

People First supports more than 220,000 users across 33 state agencies and public universities. Some 1.3 million people per year use it to apply for state government jobs. Because the SAP system wasn’t designed for state government, Florida ended up with a patchwork, server-based system with thousands of code changes, making the system very expensive to maintain. A small army of state IT staff and contractors are currently needed to support the system. Simply maintaining the current system costs approximately $32 million per year.

In 2022, the Legislature funded $1.2 million to the Department of Management Services to commission a business case to explore options to modernize People First. DMS retained one of the world’s leading IT consultancies, the Gartner Group, to examine options. Gartner concluded the state should pursue a competitive process to modernize People First and allow the incumbent and other cloud software providers to bid to ensure the state identifies a solution that fits its business requirements and Florida’s cloud first policy at an affordable cost.

In his 2024-25 budget recommendation, the Governor proposed $19.4 million to begin this process. However, there is a buzz around the Capitol that the deep state in the House of Representatives prefers the status quo. In fact, in the House proposed language in HB 5003 that was not heard by a single committee that would prevent modernization of the People First solution and legislatively direct DMS to renew the incumbent’s contract for a five-year period. This would mean state and public university employees and retirees would continue to struggle under poor service provided by the existing, antiquated People First system, while SAP would continue to bill the state millions for a solution that does not adhere to Florida’s cloud first policy or meet the needs of its workforce.

People are by far the largest cost in the state budget. In a competitive labor market, the employee experience matters if the state is to recruit and retain the best and the brightest. The People First system is simply too important for politics to prevail and monopolistic practices to rule the day.

Florida is long known for embracing market forces to determine the best outcome. A modern cloud-based replacement for People First will protect valuable employee/retiree data by providing enhanced cybersecurity, improve access to badly needed data to manage the workforce, introduce industry HR best practices to state government, and reduce costs through scale economies associated with cloud computing.

It is time for the Legislature to put politics aside, vote down any effort to promote uncompetitive practices and support the Governor and Department of Management Services in a competitive People First modernization process.