1. State Treasury Agency, Azerbaijan Republic
Nazim Gasimzade, Chief of the Information Technology department
Baku, April 11th, 2018

2. Re-engineering TIMS project: challenges faced and lessons learnt
Country overview
Project overview
Key challenges and success factors
Business case and actual business benefits achieved
Rapid time to value and TCI/TCO
Questions & answers

3. Azerbaijan Overview Population Capital 9 100 000 Baku Area
sq. km
GDP
37,9 billion USD
PPP
USD

4. Project Overview Project name Project scope (SAP Functionality)
Treasury Information Management System
Project scope (SAP Functionality)
SAP Financial Accounting
SAP Public Sector Collection and Disbursement
SAP Materials Management
SAP SEM
SAP Process Integration
Process coverage
Budget forecasting, planning & expenditures
Implementation partner
SAP CIS
Rollout scope
87 subsidiaries
Implementation method
CCPM – Critical Chain Project Management
Project
Go-live
June 29th, 2011
April 17th, 2009
400
Users implemented
100
Additional users planned
1 200
Estimated project effort

5. Treasury Information Management System
High Level Concept
Budget
assignation
MOF - Budget
Financial reports
Taxpayers
Budgets for BO
Line Ministries
Treasury Information Management System
Exchange Interface
State
Treasury
Agency
Vendors
Revenue and expenditures forecast, budget earmarking
Payments
Commercial
Banks
CBAR
Single
Treasury
Account
(STA)
Payments/
Salary
Cash limits, reports
Revenue and expenditures forecast, budget earmarking
Budgetary organizations
Regional
Treasury Agencies
End of the day settlements
Incoming
payments
Cash limits, reports
Salary
Requests for commiments, settlements and invoice approval BO
Approved invoices, payments, reports 5

6. Key project challenges
1. Number of project participants and «influencers»
2. Project geography
3. Need to train end- users across the country
The need to manage expectations from different sides
National wide project
Establishing training center, web-portal with courses, tests

7. 1. Number of project participants and «influencers»
Directly involved
Influencing
Ministry of Finance
State Property Committee
State Social Protection Fund
Treasury
Central Bank
Contractors
The State Oil Fund
Ministry of Taxes
The State Customs Committee
The need to manage expectations from different sides and show transparent picture of project progress leads to specific quality management practices in project

8. Quality Management and Operational Readiness
How we managed organizational complexity of the project
Every phase of the Project was thoroughly planned, reviewed and agreed upon by each and every member of the Project Team. Every involved party (treasury agencies, budget organizations, etc.) including 3rd parties (banks, Tax Ministry, Social Protection Funds etc.) had its say in preparing requirements and laying out blueprint of the Project.
Risk categorization has been put in place. Possible risks were categorized in terms of probability, impact, level and category. Taking into account that CCPM methodology was used, buffers were split into 5 categories, with 1 being an acceptable penetration and 5 flagging critical penetration. Weekly reviews were conducted, required adjustment made.
Well established chain of commands and communication lines between key stakeholders and core team. It was told once and for all that integration is not just plugging technology together; it’s about people, processes and systems working together. Monthly reviews were conducted, distinguished core-team members were awarded bonuses and extra intangibles were put in place to drive success factors up.

9. 2. Project geography 80+ regional offices connected to the system
kilometers of network
BAKU
Project roll-out of the whole country

10. 3. Need to train end-users across the country
More than 400 users across the territory
Not all of the users worked with computers before at all
New specific functionality in new system
Quality of the data from end-users is critical for project success (and state budgeting process success)
Specific actions were made during the project to train end-users: training center established, tests for end-users, special trainings conducted

11. Quality Management and Operational Readiness
Knowledge transfer and operational readiness
Fully equipped separate classroom was set up to conduct trainings of the end-users. Internal core-team members went through rigorous trainings and worked side by side with integration partner in setting up system. Train the trainer programs were conducted. Most involved and showing good results end-users were transferred into trainers. Training schedules were posted on our internal web-portal well ahead of time along with training materials. Connection to the Testing system was set up at each location in order to allow end-users to start practicing even before actual trainings took place.
To ensure operational readiness high number of exercises were prepared; occasional tests were held; internal team members’ responsibilities in regards to implemented modules were clearly stated; user profiles were thoroughly studied.
We held a number of sessions explaining the benefits of the new system, had live presentation from a number of clients with similar system, made emphasis on flexibility of OLTP system, explained benefits, and made sure that every involved party knew that this system is designed for them and not the vice versa

12. Key Challenges and Success Factors
Key challenges faced
Aligning TIMS Project stakeholders and resource allocations with daily operations and other ongoing projects.
Effective transferring end-users from legacy system into new system
Internal restructuring of departments and redefining of the roles and responsibilities to match business model
Key lessons learnt
Internal structure must match business model and it should be done well before project starts
Resource dedication rules should be established well ahead of the Project
Well-trained internal team is the key to sustaining long run of the Project after completion

13. Key Challenges and Success Factors
Key contributors to the success of your project:
Very well established chain of commands and lines of communication
Single access point to address “hot” issues rather quickly
Accordingly with the formal methodology used during the Project, defining “buffers” big enough to meet budget and time constraints
Highly qualified group of the consultants provided by SAP CIS

14. Business Case and Actual Business Benefits
Business objectives we initially intended to realize through the project
From year 1994 till 2012 Azerbaijan together with International Monetary Fund conducted reforms of the public sector and it was essential to reflect results of those reforms in the new system.
New system based on SAP platform had to lay ground for accrual and cash based accounting, for establishing accounting standards, for smooth transition to IFRS, creating total transparency and flexibility; establishing flexible system with online reporting; putting in place rules for budget forecasting and cash flow and liquidity; establishing direct communication to exchange information with 3rd parties, for online control and monitoring of available funds, for creating opportunity for external and internal audit, for controlling entire budgeting process starting with assigning funds and seeing all the way through how those budgets are used.
Replacing decentralized legacy system with centralized OLTP & OLAP systems; creating transparent and flexible Single Treasury Account; establishing correct business model with clear distinction of roles and responsibilities , reducing total cost of ownership;

15. Business Case and Actual Business Benefits
Business benefits actually achieved through the project
Time required to settle payments got reduced from two days to 30 minutes; Single Treasury Account allowed for synthetic transfer of funds between different budgetary addresses, reducing time required for such transfers from several days to 30 minutes; eliminating bank fees for transferring funds between budgetary addresses brings savings over 1.5 million Euro yearly
Totally transparent system of full monitoring and controlling of state finance allowing to drill-down to the last penny and how it was used in Azerbaijan.

16. Business Case and Actual Business Benefits
Goals
Result
Creating opportunities for accounting and financial statements either on the cash basis or accrual basis
Conducting accounting operations in accordance with national IPSAS
standards
Obtaining financial statements in accordance with Azerbaijan legislation and GFS & IPSAS standarts.
The transition from the single treasury account to the treasury single account
The possibility of external audit of public spending and revenues
Auditor tracking in the documentary and user context
Keeping all treasury operations in real-time
Creating a database easily integrated with external systems for financial and economic planning, analysis and management
The project resulted in the creation of the state budgeting system that is modern, effective and meets the needs of the rapid growth of Azerbaijan economy

17. Rapid Time to Value and TCI/TCO
Due to using CCPM time monitoring & controlling was buffer based, where every possible effort was applied to avoid deep buffer penetrations. Steering Committee meetings were held on monthly basis, proper resource distribution were monitored on the daily basis by team-leaders, issues were prioritized, categorized and taken care accordingly.
Project was completed in time but go-live date was shifted from the end of the year to the middle of the year in order to ease end-users into system. Decision was made by the Steering Committee since budget organizations have tendency to conduct most of their operations at the end of the year. All deviations and changes took place solely based on changed business requirements.
Sufficient trainings paved a way to develop internal technical team that took charge of delivering required reports both in our SAP R3 system and BI system. That allowed integration partner to concentrate solely on configuration changes and reduce implementation time significantly. ECATTs have been developed to reduce testing time.
Wide Involvement of key stake holders, end-users and business unit leaders; establishing single point of access to address issues in order to cut down on response time; standartization of the business model; restructuring business subsidiaries to match with new model

18. Q&A