Information Technology Information Technology Executive CouncilExecutive Council

Sunflower ProjectSunflower ProjectKansas Financial Management System

Kent OlsonDirector of Accounts and Reports

April 24, 2008

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Today’s AgendaToday’s Agenda

Project Purpose and Business Case

Project Status

Project Governance Structure & Team

Project Timeline

3

Executive SponsorsExecutive Sponsors

Duane Goossen• Secretary of Administration

Carol Foreman• Deputy Secretary of Administration

Denise Moore• Executive Branch Chief Information Technology

Officer

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A&R and Most Programmatic Agencies Have a Collection of Disparate Systems

A/P

AssetMgmt

CashMgmt

Purchasing

STARS &Other Central

Systems

ReceiptingRevenue

Agency 1’sSystems

A/P

AssetMgmt

CashMgmt

Purchasing

ReceiptingRevenue

Grants/Projects/

Cost Cntrs

Agency 2’sSystems

A/P

AssetMgmt

CashMgmt

Purchasing

ReceiptingRevenue

Grants/Projects/

Cost Cntrs

Agency 4’sSystems

A/P

AssetMgmt

CashMgmt

Purchasing

Agency 4’sSystems

A/P

AssetMgmt

CashMgmtPurchasing

Grants/Projects/

Cost Cntrs

5

Financial Management System (FMS)Financial Management System (FMS)

Definition:

“A comprehensive suite of integrated modules delivered by a single software vendor that provides end-to-end support for statewide administrative services”

The FMS will not include the extensive materials management and manufacturing elements found in many Enterprise Resource Planning (ERP) systems.

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FMS Will Consolidate Administrative Systems, Integrate Agency Business Functions and Interface w/ Programmatic Systems

Agency 2Agency 1

Agency 4

Agency 3

GL

Reporting

AssetMgmt

CashMgmt

Purchasing

ReceiptingRevenue

A/P

FMS

DataArchiving

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Business Case for ChangeBusiness Case for Change

Satisfy the needs of the agencies• Eliminate the proliferation of stand-alone agency systems• Avoid the cost associated with new agency administrative

systems • Avoid the cost associated with maintenance/upgrades of

current systems Significantly improve the quality, quantity, and

timeliness of information • Effective decision-making• Efficient and accurate research capabilities • Enhanced ad hoc reporting and inquiry functionality

Streamline processing and control of electronic “documents” through workflow management• Facilitates document routing, review and approval

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Business Case for ChangeBusiness Case for Change

Streamline and simplify State’s business processes • Financial• Budgeting• Procurement• Other administrative operations

Improve operational efficiency • Commercially-available FMS systems include many features

representing best management practices

Support Web-enabled self-service• State employees• Vendors conducting business with the State

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Business Case for ChangeBusiness Case for Change

Replace existing disparate systems• Costly to maintain• Difficult to administer

Automate and integrate• State’s financial accounting, procurement, asset management,

and other administrative business processes within a single database

Provide single point of entry• Eliminate duplicate points of data entry• Eliminate duplicate databases• Simplify reconciliation

Reduce/eliminate paper documents• Reduce paper and handling costs (e.g., vouchers) • Simplify record retention and audit compliance

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FMS Costs • Software• Hardware• Implementation• Upgrades• Ongoing Maint. & Mgmt.• Training

FMS Benefits/Avoided Costs

System Savings• Replacing current systems• Not implementing planned

systemsProcess-Improvement Benefits• Value Pocket benefits

vs.

1 2

3

Standard financial analysis was performed using dollar-quantifiable costs and benefits: - NPV (Net Present Value) - IRR (Internal Rate of Return) - Payback Period

Business Case for ChangeBusiness Case for Change

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Business Case for ChangeBusiness Case for Change

Cost-Benefit Analysis (from 2006 STA Needs Assessment)

Costs

Estimate system cost = $40,000,000

Benefits/Avoided Costs

System Savings: Estimated system cost savings = $27.6 million over an 11-year estimating period

Process Improvement Benefits:Estimated FTE-based benefits = $3.5 million annually after discountingEstimated non-FTE-based benefits = $3 million annually (procurement and postage savings)

Payback in Year 12 (assuming “go-live” in Year 4)

Alto, the FMS will provide a number of significant intangible benefits such as better decision-making resulting from better information, improved level of service to internal and external customers, etc.

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Agencies continue to spend, and have plans to spend, significant amounts on enhancing their existing agency-specific legacy systems or purchase their own agency-specific integrated systems – this funding could be applied toward the implementation of a single, statewide FMS

Redundant, manual work continuing to proliferate, along with smaller custom shadow systems

Previously existing shadow systems getting older, with even less technical support available

Increased retirements in next decade will provide more risk around custom/non-standard approaches, but also increase opportunity to capture savings through process standardization and automation

Business Case for ChangeBusiness Case for Change

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Business Case for ChangeBusiness Case for Change

CORE FINANCIAL

• General Ledger / Budgetary Control

• Accounts Payable• Accounts Receivable

& Cash Receipting• Cash Management• Cost Allocation• Grant Accounting• Project Accounting• Asset Management

PROCUREMENT

• Solicitations (RFx)• Catalog Procurement• Reverse Auctions• Inventory Management• Commodity Management• Vendor ManagementHR / PAYROLL

• Automated Interfaces to/from SHARP

BUDGET DEVELOPMENT INTEGRATION

• Appropriation Budget

Common Database

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Project ScopeProject Scope

“Big Bang” implementation

Software modules include:• General ledger• Purchasing• Accounts payable• Asset management• Project and grant accounting• Data warehouse and reporting• Accounts receivables and billing (optional for pilot)

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• Twenty-three agencies surveyed based on size and interfaces to STARS (central accounting system)

• Met w/ representatives of the seven universities and validated current interfaces to STARS and SHARP

• Identified approximately 54 agency systems to be de-commissioned (accounting, purchasing, grant/project/contract management, asset management)

• Identified 69 agency interfaces that will need to be modified or developed by agencies

• Identified numerous central agency interfaces that will need to be modified or developed by Systems Integrator (Set-off, SHARP, BMS)

Project ScopeProject Scope

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Project StatusProject Status

Three bids received:• Tier 1 software providers• Large multi-national systems integrators

Evaluation of proposals is proceeding

Evaluation team – 16 members from various state agencies

Software demonstrations in May

Final selection expected in July

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Project Governance Structure & TeamProject Governance Structure & Team

Executive SponsorsDuane Goossen

Denise MooreCarol Foreman

Executive SponsorsDuane Goossen

Denise MooreCarol Foreman

Steering CommitteeSteering Committee

Project DirectorKent Olson

Deputy Project DirectorPeggy Hanna

Project DirectorKent Olson

Deputy Project DirectorPeggy Hanna

Implementation Manager

Gary Schneider

Implementation Manager

Gary Schneider

Project Support StaffMuriah Baker

Project Support StaffMuriah Baker

Project Mgmt Office

(+1 staff)

Project Mgmt Office

(+1 staff)

Finance TeamMgr

Annette

Finance TeamMgr

Annette

Business Intelligence/DW

Lead

Business Intelligence/DW

Lead

ProcurementLead - Angela

(+3 SMEs)

ProcurementLead - Angela

(+3 SMEs)

A/PLead

(+2 SMEs)

A/PLead

(+2 SMEs)

Asset MgmtLead

(+1 SME)

Asset MgmtLead

(+1 SME)

Projects/Grants

Lead (+2 SMEs)

Projects/Grants

Lead (+2 SMEs)

General LedgerLead

(+2 SMEs)

General LedgerLead

(+2 SMEs)

BudgetIntegration

Lead (+1 SME)

BudgetIntegration

Lead (+1 SME)

SHARP Integration

Lead (+1 SME)

SHARP Integration

Lead (+1 SME)

Central AgencyIntegration

Lead

Central AgencyIntegration

Lead

Agency/RegentsIntegration

Lead (+3staff)

Agency/RegentsIntegration

Lead (+3staff)

Set-off & Treasury

Integration

Set-off & Treasury

Integration

Data Warehouse

SME

Data Warehouse

SME

FMS Project Organizational Chart

QA/TestLead

(+2 staff)

QA/TestLead

(+2 staff)

DevelopmentLead (+3 staff)DevelopmentLead (+3 staff)

SecurityLead

(+2 staff)

SecurityLead

(+2 staff)

Data ConversionCoordinator

Data ConversionCoordinator

Sys Admin &Build Team

(+2 staff)

Sys Admin &Build Team

(+2 staff)

Reports Development

Lead (+2 staff)

Reports Development

Lead (+2 staff)

StakeholderInput

Positions Filled

Positions Posted

Positions to-be Filled

Change Mgmt, Training,Communications &

Help Desk Team MgrTBD (+5 staff)

Change Mgmt, Training,Communications &

Help Desk Team MgrTBD (+5 staff)

Technical TeamManager

TBD

Technical TeamManager

TBD

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Planning Design Configuration/Development/Testing Integration Acceptance Testing Testing

Kick-off

10/08 01/09 03/09 01/10 03/10 07/10

Go-Live07/01/10

Project TimelineProject Timeline

Project kick-off Oct 2008

Go-live July 2010

Twenty-one month duration

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QuestionsQuestions

Project website http://www.da.ks.gov/ar/fms/