Question-and-Answer Session
Operator
(Operator instructions) And we'll take our first question today from Amy Junker with Robert Baird.
Amy Junker – Robert W. Baird & Co.
Good morning. If I could just start with perhaps the ERP implementation and a couple of questions just along that, can you just share with us what are the real issues with the productivity? Is it that the enrollment counselors were spending time in training so they weren't on the phone or what's the – I guess the question is what's the complication there? Is it that they're taking a slower time to ramp people up? If you could just help me understand that, I would appreciate it.
Ken Sobolski
Hi, Amy. This is Ken Sobolski. Thanks for joining us this morning. Let's start by saying there are no issues other than those we anticipated and the things that you've described are in fact exactly the kind of issues that result in productivity levels declining. So, think of it in term as time away from training, the time it takes to learn a new system, you're used to using something for the last five years and now you've got five weeks into using it. It really isn’t simple as that and all were reflecting is what we've been trying to communicate each quarter for the last two quarters and we're seeing what we expected and just talking about it.
Lois Martin
Amy, this is Lois, just one other thing to add to maybe add some color to that. In addition, underneath the business rules of PeopleSoft, in some cases there are now different departments doing pieces of the process than they did it before. So, again, not only is it people getting used to doing what they did before in a different way, in some cases groups have taken on pieces of the process that they never did before.
Amy Junker – Robert W. Baird & Co.
Great, that's helpful. And if I can just ask a follow up, and Lois, I guess this is directed towards you. With your second quarter guidance, how much spend, even if it's just broadly numbers, are you anticipating for the ERP? I'm just wondering what the operating margin would be if you stripped out that ERP component of it? How much we're really seeing that drag down in the margins? And if you can give the context both, I guess, in second quarter and first quarter, it would be helpful.
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