1. Financial Management System Needs Assessment Project
State of Kansas
Financial Management System
Needs Assessment Project
Steering Committee Meeting
September 28, 2006

2. Meeting Agenda Introductions Project Governance Project Overview
Key Activities
Requirements Validation
Business Case Analysis
Upcoming Activities
Questions

3. Project Governance Organizational Structure
Our starting position
Steering Committee –
Recognize Steering Committee members present
We are currently evaluating adding several non-voting members from outside of state government; SMEs/Advisors – Let us know if you have suggestions
Org chart will evolve
Purpose is to illustrate the cross-department involvement and commitment required
Different types of roles will be needed for success

4. Project Sponsors Membership
Duane Goossen
Secretary of Administration
Carol Foreman
Deputy Secretary of Administration
Denise Moore
Executive Branch Chief Information Technology Officer

5. Project Sponsors Roles & Responsibilities
Actively champion the project
Establish and cultivate legislative sponsors
Provide executive level support
Steering Committee and Project Team guidance
Monitor project progress
Provide clear direction
Ensure that the FMS initiative is aligned with the State’s strategic goals and objectives
Empower the team
Steering Committee and the Project Team
Assist with issue resolution
Resolve issues in a timely manner per the project issue escalation policy
Assist in removing obstacles
Secure required resources
Ensure funding/staff necessary to achieve project objectives

6. Steering Committee Membership
Chair - Carol Foreman, Deputy Secretary of Administration
Mary Blubaugh, Board of Nursing
Alan Conroy, Legislative Research Department
Gary Daniels, Department of Social & Rehabilitation Services
Elaine Frisbie, Department of Administration; Division of Budget
Kathy Greenlee, Department on Aging
Mike Hayden, Department of Wildlife and Parks
Lynn Jenkins, State Treasurer
Deb Miller, Department of Transportation
Reginald Robinson, Board of Regents
Howard Schwartz, Judicial Administrator
Joan Wagnon, Department of Revenue
Roger Werholz, Department of Corrections

7. Steering Committee Roles & Responsibilities
Actively participate in Steering Committee meetings
Remove obstacles to project success
Actively champion the project
Communicate project status within respective agencies
Review and provide input to final report
December 11 – December 14

8. Sponsor/Steering Committee Involvement Decision Making
Key Decisions
Will be presented during mid October – mid November
Impact analysis will be provided (as appropriate) to facilitate decision making
Documentation and communication of the decision is critical
Examples of Key Decisions
Proposed funding model
Maximizing return on investment
Level of agency participation
User agency “shadow” systems
Duplicate copies of FMS software
Deployment strategy (phased vs. “big bang”)
Functional scope
Procurement strategy

9. Project Overview What is ERP? FMS?
Enterprise Resource Planning (ERP) – A comprehensive suite of integrated modules delivered by a single software vendor that provides end-to-end support for statewide administrative services
For purposes of this study, we will use the term ‘Financial Management System’ (FMS) rather than ERP since the scope of the project includes financials and procurement only – due to current / future investment in the SHARP system
FMS is a proposed solution that provides functionality similar to STARS, SOKI, Central Setoff System, and other agency administrative systems, but in a fully integrated manner

10. Project Overview Why FMS?
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

11. Project Overview Why FMS?
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

12. Project Overview Why FMS?
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

13. Project Overview Proposed FMS functionality for consideration
PROCUREMENT
Solicitations (RFx)
Catalog Procurement
Reverse Auctions
Inventory Management
Commodity Management
Vendor Management
CORE FINANCIAL
General Ledger / Budgetary Control
Accounts Payable
Accounts Receivable & Cash Receipting
Cash Management
Cost Allocation
Grant Accounting
Project Accounting
Asset Management
HR / PAYROLL
Automated Interfaces to/from SHARP
Common
Database
BUDGET DEVELOPMENT INTEGRATION
Appropriation Budget

14. Key Activities FMS Needs Assessment
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

15. Key Activities Timeline
FMS Needs Assessment Update
Validate Functional / Technical Requirements
Project Start-Up
Validate the Business Case
Sept
Oct
Dec
Nov
Summary project schedule
From the BAFO document that meets their revised project timeline
Business Case Analysis Report
Updated Needs Assessment
Organization /
Implementation
Best Practices
Key Deliverables

16. Business Case Analysis Cost versus Benefits
Standard financial analyses will be performed using dollar-quantifiable costs and benefits:
- NPV (Net Present Value)
- IRR (Internal Rate of Return)
- Payback Period
FMS Costs
Software
Hardware
Implementation
Upgrades
Ongoing Maint. & Mgmt.
Training
FMS Benefits/Avoided Costs
System Savings
Replacing current systems
Not implementing planned systems
Process-Improvement Benefits
Value Pocket benefits 1 2
vs. 3

17. Business Case Analysis Information We Need From Agencies
Information Needed
Data-Gathering Approach
FMS Costs: Estimated costs of implementing, maintaining, and upgrading
Information provided by vendors and other statewide ERP projects
STA experience 1
System Savings: Estimated cost savings from:
Replacing existing statewide & agency-specific systems
Not implementing planned/anticipated systems
Agency System Survey
Interviews with statewide administrative systems SMEs 2
Process-Improvement Benefits: Estimated cost savings and other benefits that an FMS system would likely enable/yield 3
Value Pocket Survey
Interviews with State employees who are process/functional SMEs
SMEs = Subject Matter Experts

18. Business Case Analysis What Are Value Pockets©?
Most likely sources of value (i.e., cost savings and other benefits) to be found in each process/functional area within the scope of an FMS implementation
Provide quantified justification
STA’s proprietary formulas and calculations
Used to quantify process-improvement benefits obtained through the implementation of a statewide FMS

19. Business Case Analysis Value Pocket Components
For each Value Pocket in each process/functional area, we identify:
Specific Nature and Source of the Value
FMS Enabler
Formula for Calculating the Value (i.e., Benefit or Cost Savings), if applicable
Source of Value for Each Variable in the Formula

20. Update / Validate FMS Requirements
Functional and Technical Requirements Development Process
Requirements from 2001 Needs Assessment Study
Baseline
Draft
Final
Project Team
Focus
End User Community
Requirements
Requirements
Requirements
Group
STA Requirements Toolkit

21. Project Scope FMS Needs Assessment
Functional Components
Procurement
Grants / Projects
Cash Management
General Ledger / Cost Allocation
Accounts Payable / Accounts Receivable
Inventory / Asset Management
Budget Development / Integration
HR / Payroll Integration
Data Warehousing / Reporting
General and Technical

22. Sample Functional Requirements

23. Obtain Agency (Stakeholder) Input
Sixteen agencies have been identified as “stakeholder agencies”
Adjutant General
Department on Aging
Department of Agriculture
Department of Administration
Department of Health and Environment
Department of Transportation
Highway Patrol
Department of Labor
Department of Commerce
Juvenile Justice Authority
Department of Corrections
Department of Revenue
Social and Rehabilitation Services
State Treasurer
Judicial Branch
Department of Wildlife and Parks

24. Conduct Agency Outreach Sessions
Agencies are invited to participate!
Fifty-eight individuals representing twenty-three (23) agencies are participating in our focus group sessions
Sixteen (16) large agencies are participating in stakeholder meetings
All agencies are invited to review and comment on the draft requirements
Posted to the project website
All agencies are invited to participate in the Cost Benefit Survey
All agencies are invited to participate in the final Agency Briefings

25. Project Risks Specifically related to the FMS Needs Assessment
Executive Level Sponsorship/Involvement
Appropriate Level of Agency Participation
Timeliness of survey response
Focus Group subject matter expert (SME) participation
Decision Making Process
Impact of key decisions

26. Upcoming Activities Validate Functional &Technical Requirements
October 2 – November 21
Perform Business Case Analysis
Business Case Report
November 30
Obtain Stakeholder Input and Approval
November 30 – December 7
Conduct Agency Outreach Sessions
December 7 – December 14
Updated Needs Assessment
December 11

27. Future Meetings October Meeting November Meeting October 25
2:00 p.m. – 4:00 p.m.
November Meeting
November 16

28. Questions?