State of KansasState of Kansas

Financial Management SystemFinancial Management SystemNeeds AssessmentNeeds Assessment

Steering Committee MeetingNovember 30, 2006

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Meeting AgendaMeeting Agenda

Introductions Project Overview Project Accomplishments Status and Preliminary Findings Upcoming Activities Questions

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Project Overview Project Overview FMS Needs Assessment – Key ActivitiesFMS Needs Assessment – Key Activities

Update the system requirements for a new integrated FMS

Update the business case analysis associated with implementing a new FMS

Determine whether there is a compelling business case for procuring/implementing an integrated statewide FMS

Submit recommendations regarding• Organizational best practices• Implementation best practices

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Project AccomplishmentsProject Accomplishments Requirements Validation: StatusRequirements Validation: Status

Conducted Focus Group Kick-Off Meeting • Held 10/09/06 - 75 participants

Total of 140 participants in various Focus Groups• Represents 25 agencies

Outreach sessions directed at non-Focus Group agencies• Held on 11/14/06 and 11/17/06• 27 agencies in attendance

Final draft requirements under review by state agencies• Posted online on 11/17/06• Input due by 12/04/06

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Project Accomplishments Project Accomplishments Communication/OutreachCommunication/Outreach

Individual visits with 17 stakeholder agencies

Presented project overview/status to:

• Regents Council of Business Officers (COBO) – 10/04/06

• Regents Controllers – 10/06/06

• Information Technology Advisory Board (ITAB) – 10/24/06

• Small Agency Group – 10/25/06 and 11/29/06

• Agency STARS Rapport Association (ASTRA) – 11/09/06

Project web site received over 2200 page views in

the last 60 days

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Project Accomplishments Project Accomplishments Business Case Validation: StatusBusiness Case Validation: Status

Agency Systems Survey• Briefing to Agency CFOs on 10/03/06 • Received a total of 19 survey responses

Value Pockets Survey• Briefing to Agency CFOs on 11/02/06• Received a total of 12 responses, several

outstanding

Draft of business case report due 11/30/06

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Preliminary Findings Preliminary Findings Systems SurveySystems Survey

Total of 238 systems identified as performing administrative functions within the scope of this project (e.g., GL, AP, Procurement)• Includes automated tracking tools such as PC-based

spreadsheets and databases• 146 in Dept. of Administration alone

Total of $28,091,912 in Annual Systems Costs reported over 11-year estimating period

Only 9 agencies provided estimates of costs to enhance existing/implement new systems• Approximately $7.2 million in costs• $5.5 million from KDOT alone

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Preliminary Findings Preliminary Findings Systems SurveySystems Survey

Comparables from Other States:• Kansas (25,000 employees)

– Approximately $3 million per year in ongoing avoided systems cost (so far)

• Minnesota (33,000 employees)– Approximately $5 million

• Tennessee (41,000 employees)– Approximately $16 million

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Preliminary Findings Preliminary Findings Value Pockets SurveyValue Pockets Survey

Comparables from Other States:• Kansas (25,000 employees)

– Approximately $8.5 million in annual FTE-based Value Pocket benefits; no discounting of this amount has yet been applied

• Minnesota (33,000 employees)– Estimated $4.6 million could potentially be realized

annually in FTE-based Value Pocket benefits

• Tennessee (41,000 employees)– Approximately $6 million in gross FTE-based Value

Pocket benefits; assumed 75% or $4.5 million could be realized annually in time

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Preliminary Findings Preliminary Findings Proposed Functional ScopeProposed Functional Scope

Driving Factors• Functional Needs• Value Proposition• Mandate / Strategic Initiative• Organizational Change Impact• Project Staffing Considerations• Risk Avoidance / Mitigation• Funding• Prior Track Record with Similar Projects

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Preliminary Findings Preliminary Findings Proposed Functional ScopeProposed Functional Scope

Modules• General Ledger (including Grant Accounting and

Cost Allocation) • Accounts Payable• Procurement• Asset Management• Budget Development Integration (3 options)• Reporting / Data Warehouse

Issues• SOKI• Set-Off

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Preliminary Findings Preliminary Findings Proposed Deployment ApproachProposed Deployment Approach

“Big Bang” Deployment

Pros “True” enterprise focus as all agencies “go live” on all FMS

functionality simultaneously Reduced implementation timeframe Potentially least costly strategy as all functionality is implemented

in shorter time period Most efficient approach to data migration from legacy systems Eliminates the need for temporary interfaces that are required

when deployment “phasing” is utilized Less likely to have to implement a new software release before

FMS has been deployed at all state agencies State begins realizing the benefits and efficiencies earlier,

potentially avoiding implementation of new shadow systems for those agencies with compelling functional needs and/or pending software obsolescence

Risk of project team member turnover is reduced substantially due to compressed deployment time period for all state agencies

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Preliminary Findings Preliminary Findings Proposed Deployment ApproachProposed Deployment Approach

“Big Bang” Deployment (cont.)

Risks Greatest change management impact to organization due to all

functionality going “live” simultaneously Major training impact as high volume of end users must be

provided with “just in time” training within a narrow window of time May require largest project team size User participation is required for a limited but intense period of

time Extensive data migration activities must be completed

simultaneously Higher risk of problems due to compressed timeline and large

functional scope with less margin to correct / mitigate problems that arise

Inability to take advantage of lessons learned from previous phase(s) of deployment

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Preliminary Findings Preliminary Findings Proposed Deployment ApproachProposed Deployment Approach

“Phased” Deployment

Pros Provides ability to validate the “proof of concept” Provides the ability to fund project over multiple budgetary

periods Change management impact is dispersed across longer

period of time – can be focused on only those agencies that are part of specific deployment phases

Knowledge gained and lessons learned from initial deployment phases can be used for remaining deployments of the FMS throughout state government

Project team focus is on a single phased deployment at a time

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Preliminary Findings Preliminary Findings Proposed Deployment ApproachProposed Deployment Approach

“Phased” Deployment (cont.)

Risks Requires concurrent operation of legacy systems and new FMS for

long period of time Requires greater timeline to complete entire deployment across

state government Can be very costly to the State due to increased timeline May lead to difficulties in completing deployments for agencies

scheduled for deployment late in project due to possible loss of momentum, lack of funding, and other issues that may arise due to an expanded rollout schedule

Complex data migration from legacy systems and ultimate elimination of legacy system usage due to deployment “phasing”

Requires the use of temporary interfaces due to “phasing” Will take a longer period of time to realize benefits and efficiencies Need may arise to implement a new software release before FMS

has been deployed at all agencies due to extended deployment time period

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Preliminary Findings Preliminary Findings Proposed Deployment ApproachProposed Deployment Approach

“Phased” Deployment (cont.)

Risks (cont.) Possible inconsistencies in enterprise data and reporting due to the

continued use of the FMS for the agencies participating in the Pilot Project and continued use of legacy systems by the remaining state agencies until all agencies have been deployed on the FMS

All state agencies may be involved in the initial system design and configuration, but may have to wait a considerable period of time before they can actually access to the FMS

Numerous iterations of training must be provided concurrently with deployment phasing, and may require updating due to system enhancements/changes associated with new software releases and “fixes” that are applied during the extended deployment time period

Some agencies may have compelling functional needs and/or pending software obsolescence that may cause them to move forward independent of the FMS project due to lengthy deployment timeline

Major risk of project team member turnover due to lengthy deployment time period could cause problems for state agencies scheduled for the late phases of deployment

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Preliminary Findings Preliminary Findings Proposed Deployment ApproachProposed Deployment Approach

“Big Bang” deployment strategy recommended

Pre-implementation activities completed over period of 12-18 months

21 – 24 month implementation period Currently reviewing tentative go-live target

(fiscal vs. mid-year)

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Preliminary Findings Preliminary Findings Proposed Project Organization - State (49)Proposed Project Organization - State (49)

Steering Committee

Project Manager(1)

Deployment Lead(1)

Change Management

(4)

Training(8)

Finance Team Lead(1)

Accounts Payable(2)

Budget Development

(2)

General Ledger /Budget Control

(3)

Project/Grant Accounting

(3)

Purchasing Lead(1)

Asset Management(2)

Purchasing(3)

Project Admin Support

(1)

Technical Lead(1)

Enhancement/Workflow

(5)

Infrastructure(4)

Interface/Conversion

(5)

Report Development

(2)

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Preliminary Findings Preliminary Findings Proposed Project Organization - Consultants (30)Proposed Project Organization - Consultants (30)

Project Manager(1)

Deployment Lead(1)

Change Management/Deployment

(4)

Training(4.5)

Finance Team Lead(1)

Accounts Payable(1)

Budget Development

(1)

General Ledger /Budget Control

(1)

Project/Grant Accounting

(1)

Purchasing Lead(1)

Asset Management(1)

Purchasing(1)

Project Admin Support

(1)

Technical Lead(1)

Enhancement/Workflow

(3.5)

Infrastructure(2)

Interface/Conversion

(2.5)

Report Development

(1.5)

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Preliminary Findings Preliminary Findings Pre-Implementation ActivitiesPre-Implementation Activities

Formalize pre-implementation governance structure and organization as a project and staff appropriately

Perform organizational change readiness assessment Develop and initiate staffing approach for

implementation project Benchmark existing financial management and

procurement business processes Document State’s “As Is” business processes Development of existing legacy system reports

inventory Perform data cleansing activities Review and evaluate existing chart of accounts

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Preliminary Findings Preliminary Findings Pre-Implementation ActivitiesPre-Implementation Activities

Conduct alternative solutions analysis to determine how best to address existing SOKI, Set-Off, and SHARP time and effort functionality

Develop RFP(s) for FMS software and associated implementation services, and evaluation process to be followed

Development of demonstration evaluation scripts to be followed by vendor finalists during their software demonstrations

Proposal evaluation and contract negotiations Plan and prepare re: project logistics (physical space

for project team, etc.)

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Upcoming ActivitiesUpcoming Activities

Review/Approve Business Case Analysis Catalog Major System interfaces

• Through December 11

Finalize Stakeholder Input and Approval• Through December 4

Deliver Updated Needs Assessment• December 15

Conduct Final Steering Committee Meeting• January 2007

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Project InformationProject Information

http://da.ks.gov/ar/fms/

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Questions?Questions?