2. Integrating Systems and Processes: Update on ADvance Katie Crowley Deputy General Manager U.S. Department of Education May 3, 2005

3. 2 nd Annual Conference on Technology and Standards 3 Agenda  ADvance in Context  ADvance Overview  Technology Highlights  Implementation Approach and Success Criteria

4. 2 nd Annual Conference on Technology and Standards 4 Agenda  ADvance in Context  ADvance Overview  Technology Highlights  Implementation Approach and Success Criteria

5. 2 nd Annual Conference on Technology and Standards 5 Context: Strategic Objectives Improve Program Integrity Improve Products & Services Reduce Costs Improve Human Capital Management Modernize & Integrate Systems - Reconcile current business demands, economics and future business strategies with present state of legacy systems, technology and human resource skills -Strengthen financial management and internal controls -Provide effective oversight -Ensure the accuracy of all data -Implement an integrated set of information systems -Ensure contracts are designed to enable cost reduction and re- engineered business processes -Establish metrics to measure performance and productivity trends across the enterprise over time -Ensure FSA has the right people in the right jobs with the right skill sets -Create and foster an environment for collaborative problem solving and decision making -Listen to the customer to understand and prioritize needs and/or desired products and solutions -Inform business solutions by incorporating industry best practices

6. 2 nd Annual Conference on Technology and Standards 6 Context: Target State Vision Life- cycle Phase Applicant/ Borrower Process Department of Education Help Desk Financial Partners Portal Schools Portal FSA Trading Partner Process Partner Application Oversight Aid EducationSubmissionEligibilityRepaymentConsolidation Aid Awareness & Application Institution Participation Servicing Trading Partners & Servicers Guaranty Agencies Student Aid on the Web Call Centers Collections Origination & Disbursement ED Financial Management Lenders (Lender Servicers) Other External Partners To-Be Financial Aid Life Cycle DRAFT High-Level Business View State Agencies Schools ( School Servicer) Common Services for Borrowers Origination & Disbursement Trading Partner Management Delivery FSA Gateway Award & Disbursement Processing School Aid Payments & Funding Level Mgmt Partner Enrollment Partner Eligibility & Oversight Funds & Internal Controls Service Loans Recovery & Resolution ITA Integrated Technical Architecture VDC Virtual Data Center EAI Enterprise Application Integration Internal Transfer External Transfer Business Function Application Aid Eligibility Determination Establish Person Record GL Accounting Budgeting External Financial Reporting Authentication & Access Management Credit CheckSSCRServicing Reporting (FFEL & Campus Based) Edit Checks Enterprise Shared Functions Common Data Architecture Generate/Distribute ISIR/SAR CSB FMS Enterprise Shared Functions Warehouse/Data Marts Match Against CDA (FAH) Send/Receive from Matching Agencies SSIM Logic Consolidate Loans Payment Processing Authentication & Access Tools Enablers Business Intelligence Tools Enterprise Analytics and Research Acquisition & Planning Strategy Enterprise Performance Management Case Tracking (Ombudsman) Partner Payment Calculation/PrePopulationCDR Recommend Policy Changes Ancillary Services Aid Awareness NSLDS Partner Payment Management Partner Payment Admin Transactions Students Trading Partners Process Payments State Agency Funding Analytics Computation Edits - EFC AR Managment Distribute Eligibility Transfer MonitoringProcess Promissory Notes FMSSGAPS RID Mappings Application Process Relationship Mgmt Audit History

7. 2 nd Annual Conference on Technology and Standards 7 Context: Target State Vision  Business Capability Areas Origination & DisbursementApplication Aid Eligibility Determination Establish Person Aid Awareness Award & Disbursement Processing Student Aid Payments & Funding Level Mgmt External Transfer Business Function Application Aid Eligibility Determination Establish Person Record GL Accounting Budgeting External Financial Reporting Authentication & Access Management Credit CheckSSCRServicing Reporting (FFEL & Campus Based) Edit Checks Enterprise Shared Functions Common Data Architecture Generate/Distribute ISIR/SAR CSB FMS Enterprise Shared Functions Warehouse/Data Marts Match Against CDA (FAH) Send/Receive from Matching Agencies SSIM Logic Consolidate Loans Payment Processing Authentication & Access Tools Enablers Business Intelligence Tools Enterprise Analytics and Research Acquisition & Planning Strategy Enterprise Performance Management Case Tracking (Ombudsman) Partner Payment Calculation/PrePopulationCDR Recommend Policy Changes Ancillary Services Aid Awareness NSLDS Partner Payment Management Partner Payment Admin Transactions Students Trading Partners Process Payments State Agency Funding Analytics Computation Edits - EFC AR Managment Distribute Eligibility Transfer MonitoringProcess Promissory Notes FMSSGAPS RID Mappings Application Process Relationship Mgmt Audit History

8. 2 nd Annual Conference on Technology and Standards 8 Context: Other Initiatives Common Services for Borrowers NSLDS ADvance Integrated Partner Management Portals FMS Single Place To: - Submit eligibility information (accreditation, audits, financial statements) - Request access to FSA systems - Make changes to demographic information Single Place To: - View integrated student information (including aid history) - Conduct all ‘front end’ processing (applications through disbursements and funds management) - Get Help Desk support Single Place To: - Manage all federally- held financial aid debt repayment - Consolidate student loans into Direct Consolidation loans - Access school-level entrance/ exit counseling & borrower delinquency information

9. 2 nd Annual Conference on Technology and Standards 9 Agenda  ADvance in Context  ADvance Overview  Technology Highlights  Implementation Approach and Success Criteria

10. 2 nd Annual Conference on Technology and Standards 10 ADvance Overview  FSA's ADvance initiative consolidates Application Processing, Common Origination and Disbursement, Customer Service (G2C) and Help Desk (G2B)  These functions are currently supported by multiple contracts with near-term expiration dates or non-competitive extensions  Status quo fragmented environment makes it difficult for students, parents and student aid delivery partners to interact with FSA and cumbersome for employees and customer service representatives to understand and respond accurately and timely to customer inquiries

11. 2 nd Annual Conference on Technology and Standards 11 The Opportunity  ADvance is an opportunity to –Define the business needs (students, delivery partners, FSA) –Re-define the processes to better serve students –Update technology to provide more flexible platform for future enhancements –Incorporate the principles of data strategy and move towards our target state

12. 2 nd Annual Conference on Technology and Standards 12 The Opportunity: Spring Conference 4,731 Ideas Led to 9 Emergent Themes Get the “big picture” Know the audience Reach and engage the audience Build an infrastructure of support Integrate data across agencies Change policies and rules Simplify, simplify Evaluate and improve Be open to “the new”

13. 2 nd Annual Conference on Technology and Standards 13 More to come… Detailed comments will be posted to IFAP and ADvance website (www.advance.ed.gov)www.advance.ed.gov The Opportunity: Spring Conference

14. 2 nd Annual Conference on Technology and Standards 14 Overview: What Will Change More Efficient Business Processes – Core front end processes on single platform, reducing redundancies and hand-offs Integrated Technology – Single platform utilizing shared data provide for easier maintenance and reduced operations costs; consistent with enterprise architecture Increased Data Integrity – Common data and reduced interfaces lead to more accurate and consistent data Enhanced Customer Service - Integrated views, single point of contact by customer base and increased self-service improve customer experience Greater Control - Unlimited rights to software and all supporting documentation, ownership of Seibel licenses and data

15. 2 nd Annual Conference on Technology and Standards 15 Overview: What Won’t Change Focus on Customer – FSA will continue to focus on the customer, identifying opportunities to improve the student experience and the delivery of financial aid Commitment to Standards – FSA remains firm in its commitment to work with community to establish standards and in its commitment to implement to these standards Collaboration with Delivery Partners – FSA will continue to work closely with all its partners – lenders and their services, guaranty agencies, schools and their services, software developers, state agencies – to meet our common goals

16. 2 nd Annual Conference on Technology and Standards 16 Agenda  ADvance in Context  ADvance Overview  Technology Highlights  Implementation Approach and Success Criteria

17. 2 nd Annual Conference on Technology and Standards 17 Technology Highlights All Java solution – Over the transition period all of the old Cobol code will be bulldozed and replaced with Java Code on the new platform. Standards based ESB – WSDL, XML,BEPL4WS and J2EE –The new solution will be moving away from purely proprietary code and utilizing innovative open standards and tools sets to develop and maintain the system, increasing stability and portability

18. 2 nd Annual Conference on Technology and Standards 18 Technology Highlights Service Oriented Architecture (SOA) – SOA for FSA means – –Reusable components exposed through services shared with business partners (i.e., postsecondary education institutions, guaranty agencies, state agencies, financial industry organizations, and other education-related organizations) and enterprise systems enabling low-cost, low-impact environmental adaptation

19. 2 nd Annual Conference on Technology and Standards 19 Technology Highlights Presentation Service Business Layer Data Access Data

20. 2 nd Annual Conference on Technology and Standards 20 Technology Highlights eXtensible Markup Language (XML) – FSA remains committed to the use of XML. Specifically within ADvance XML will be used for:  External data exchanges: e.g. - XML ISIR  Internal data exchanges: transmission to web presentation layer

21. 2 nd Annual Conference on Technology and Standards 21 Technology Highlights: Data Architecture Common Data Repository (Students, Organizations, Aid Summary) – Exposed to enterprise through shared services Transactional Database – data structures and services focused on transactional processing while also supporting batch processing System ID - Unique identifier for all students Transaction ID – Unique identifier for all interface transactions between ADvance and other FSA systems DB2 on mainframe

22. 2 nd Annual Conference on Technology and Standards 22 Technology Highlights: Proof of Concept Validate the core application infrastructure and supporting infrastructure –Validate that the WBI-SF and Process Choreographer can handle the transaction load needed –Validate running Java applications on processors Implement SOA best practices Document development, build, and configuration management processes Long term performance test environment

23. 2 nd Annual Conference on Technology and Standards 23 Agenda  ADvance in Context  ADvance Overview  Technology Highlights  Implementation Approach and Success Criteria

24. 2 nd Annual Conference on Technology and Standards 24 Implementation Approach: Key Dates  Start Date: February 1, 2005  Initial focus on requirements (complete 7/2005), technical proof of concept and quick hits for student contact center  Initial Go-Live January 2007 for 2007-08, application processing only –Includes system and new tools for customer service (e.g.: integrated views)  Full award year processing for integrated application, origination and disbursement for 2008-09

25. 2 nd Annual Conference on Technology and Standards 25  Technical Proof of Concept  Gradual transition of origination and disbursement help desk and system processing –Transition of oldest prior years first (lowest volume of transactions) –6 months+ of parallel system processing (for testing purposes only) –6 months+ of “shadowing” help desk Implementation Approach: Risk Mitigation

26. 2 nd Annual Conference on Technology and Standards 26 Success Criteria Successful implementation of new solution Maintain current levels of service on existing operations Integration of new solution with FSA enterprise

27. 2 nd Annual Conference on Technology and Standards 27 Questions?