More than one reader has asked, “Why upgrade to PS 9.2 now? Why not wait—or even skip it and just deploy a future release?” Inherent in these strategies is the assumption that the cost of the upgrade is greater than the benefits its deployment would produce. Today I’ll look at why it can be worthwhile to upgrade now and stay current in the future.

The included charts display simplified examples of upgrade costs and benefits and how breakeven is affected under 3 different deployment scenarios. I’ve used a 78-month period in order to include the possibility to upgrade from PS 9.1 to PS 9.2 and/or the next future PeopleSoft release—labeled PS X>X. (Please note: I do not know when a future release will be available. These are only examples.) Assumptions:

  • Cost to upgrade = $720,000 initial one-time cost/ upgrade (for example purposes)
  • Savings = $20,000/month (for example purposes)
  • Breakeven period = 36 months
  • All three examples show an initial deployment of PS 9.1 in period 0 and assume these organizations were late adopters of PS 9.1 (i.e., PS 9.2 became available shortly after their 9.1 deployment).
  • The benefits of each deployment are added to the benefits of each previous deploymentmdash;benefits from PS 9.1 are still being realized after PS 9.2 is deployed, etc.
  1. 9-2_041613_SkipSkip a release. This example shows an upgrade to PS 9.1 in period 0 for $720k. It then skips an upgrade of 9.2 and upgrades to PS X.X. This upgrade occurs in 72 months for another $720k. This example shows the organization recovers all costs in 36 periods and generates a surplus after period 36. In month 73, the organization starts the process over on PS X.X. This strategy generates a net benefit to the organization but not the maximum benefit.
  2. Adopt late again. This example shows an upgrade to PS 9.1 in period 0 for $720k and recovers all the costs by period 36. The upgrade to 9.2 is in period 36 for another $720k. This upgrade recovers its cost quicker as the benefits of 9.2 9-2_041613_LateAdopterupgrade are in addition to the benefits already being realized from 9.1.
    The upgrade to PS X.X occurs at period 72 at a cost of another $720k. This example shows the organization is sometimes better and sometimes worse off (compared to Example 1) at different points in time up to period 72—the point when both have deployed the same release at the same time—PS X.X. This makes sense; they should show an identical result after period 72. This example invested more and benefited more up to the point that they both are running the same release. This strategy also generates a benefit for the organization, but not the maximum benefit.
  3. 9-2_041613_CurrentGet and keep current. This example shows the same initial late upgrade to PS 9.1 in period 0 for $720k, then shows a change in strategy by deploying PS 9.2 just twelve months later for another $720k. This example has the longest payback period—48 periods; however, it also generates the largest benefit.

As you can see, the decision as to whether or not and when to deploy a new release can clearly affect how much total value an organization will ultimately receive. Since each upgrade generates benefits, the sooner you can realize and begin to accrue those benefits, the more value you’ll accumulate over time. Strategies 1 and 2 will never catch up with Strategy 3, and thus indicate that an organization should deploy efficient processes as early as possible (continuous improvement process). You don’t put off the deployment of an even more efficient process just because you made a good efficiency change last month—right?
Now, in order to make this exercise meaningful, we have to plug in real costs and evaluate and calculate actual expected benefits.
The cost to upgrade the core PS system (the technical part) is easy to determine. Our upgrade lab can provide a fixed quote for the entire tech upgrade, two test moves in our lab environment, and then a final move to production on your hardware. The additional costs of testing, training, BPI workshops, and determining what system modifications you’re bringing forward are not included in the tech upgrade but need to be included to calculate a total upgrade cost.
To quantify the benefits from your upgrade, I recommend starting with two Oracle documents: the PS 9.2 Release Notes and the Cumulative Feature Overview Tool (remember you’ll need your userid to log into see these docs). Using these tools, you can identify:

  • What new features and functions will benefit your organization
  • What customizations and modifications you can replace with delivered processes

Once you identify the benefits, you can calculate the savings and create your business case. A few of the new features I think will generate a return on your PeopleSoft 9.2 upgrade include:

  • Processes that are re-designed to reduce clicks, be more intuitive and automatic.
  • Reporting improvements which include sending query results into pivot grids with drill downs and manager dashboards with real-time and actionable data.
  • Improved patch application with PTools 8.53. Instead of applying a of patch bundle or identifying a single patch (with the dependencies), the PS Update Manager can create a unique group of patches for you—a single patch, only high severity patches, or all that apply to your environment. You decide and apply.
  • The landing page—new feature of PTools 8.53. If you haven’t seen this feature, click here. Old and new users will find this UI very easy to use to quickly gain proficiency with 9.2.
  • Work centers, delivered analytics, and work flows are all additional areas to explore for benefits.

(Remember that every upgrade plan should include time to review modifications to determine if they can be replaced with newly delivered functions.)
All these benefits can add up to real savings—some hard savings and some that are softer or more difficult to assign a dollar value to. When I create a business case, I like to separate the soft and hard benefits. Hard benefits are generally those that eliminate an identifiable expenditure. These are relatively easy to quantify. Soft benefits can be those that save a little time whenever the transaction is executed, increase accuracy, etc. Soft benefits are important as they can free employees’ time for more valuable work, improve customer service (potentially increasing sales), and provide many other types of improvements.
I look at a business as if it’s mine. I’ll spend a dollar when I know I’ll get something back—whether it’s an obvious, quantifiable dollar return or the value associated with automating repetitive tasks. Additionally, if you include soft costs (like the cost of the labor for testing/training) as part of total cost in your upgrade cost/benefit analysis, then it certainly makes sense to include the soft benefits in order to ultimately make a fully informed decision.
Next week I will complete what I promised for this week: project scope, BPI, and Organizational Change Management (OCM).
As always, feel free to contact me at if you have comments or questions.