1. 1 expect the best www.vita.virginia.gov Lemuel C. Stewart, Jr. CIO of the Commonwealth Information Technology Investment Board August 10, 2005 CIO Status Report

2. 2 expect the best www.vita.virginia.gov Audit Action Plan Update 2005 APA Internal Control & Compliance Audit Action Plan The 1 action has been completed. 2005 APA Performance Audit Action Plan 7 of 15 actions reported as completed 4 actions have revised completion dates: #6 Project Proposal Template Enhancements 11/15/05 #7 Portfolio Enterprise Solution 8/19/05 #11 Security Procedures and Configuration Standards – 9/15/05 #12 Integration of Security Governance & Security Operations - 9/30/05 Remaining 4 actions reported to be on schedule

3. 3 expect the best www.vita.virginia.gov Audit Action Plan Update 2004 APA SAS 70 Audit Action Plan 3 of 4 actions reported as completed 1 action has a revised completion date: #2 Develop Configuration Standards – 9/15/05 Internal Audit Small Purchase Charge Card Audit Action Plan 2 of the 16 actions reported as complete 12 actions have revised due dates primarily tied to policy revisions Remaining 2 actions reported to be on schedule

4. 4 expect the best www.vita.virginia.gov Finance Report—Cash Flow

5. 5 expect the best www.vita.virginia.gov IT Savings Initiatives

6. 6 expect the best www.vita.virginia.gov VITA SWAM Update SWAM PROGRAM –Hired a dedicated SWAM Outreach Specialist – Beverley Coleman –Continued coordination w/ DMBE for awareness, education & certification –SWAM specific Web page with access to upcoming procurements and approved projects Three largest spend relationships –Digital Intelligence Systems Corporation – $12M –Daly Computers, Inc. – $5M –DLT Solutions, Inc. – $1M

7. 7 expect the best www.vita.virginia.gov SWAM IT Spend (Two Years) Millions Entities Leveraging VITA-Facilitated Suppliers

8. 8 expect the best www.vita.virginia.gov JLARC Customer Survey Significant concerns with methodology VITA/UVA Center for Survey Research

9. 9 expect the best www.vita.virginia.gov Transformation & PPEA Common themes about current state of IT –IT investments are managed effectively—we are doing things the right way –Agency-centric approach is OK—we don’t need to change the way we do business –Consolidation means large, immediate cost savings Extensive due diligence results support the need to change the way we do business

10. 10 expect the best www.vita.virginia.gov Current State—Due Diligence Results Highly decentralized model of service delivery and administration Largely self-contained solutions (silos) Antiquated systems developed in the ’70s Aging workforce Inadequate security tools and inconsistent practices and standards Inadequate data center facility with security risks Duplication of administrative systems at high cost

11. 11 expect the best www.vita.virginia.gov Current State—Infrastructure 70 IT helpdesks 8 different e-mail systems running on 270 servers Lack of standardization and inability to transfer employee skills Inability to deploy enterprise solutions on common infrastructure Limited performance measures and service metrics Inadequate disaster recovery and continuity of service plans Servers, networks, and PCs underutilized

12. 12 expect the best www.vita.virginia.gov Current State—Infrastructure Capacity “Dashboard” 0 1000 20 40 60 80 20 40 60 80 100 20 40 60 80 0 0 100 20 40 60 80 3,000 Servers <20%160,000 Network Connections <60% Website compliance with Sec. 508 23% Desktop Computing Capacity <10% (vs. Grid Computing)

13. 13 expect the best www.vita.virginia.gov Current Status—Enterprise Applications 26 processes examined in 46 agencies # of Systems Annual Cost Financial Systems160$117 M Human Resources Systems55$36 M Other Admin Systems$147 M Total Annual Cost$300 M

14. 14 expect the best www.vita.virginia.gov If We DON’T Transform… It Will Cost Us $1.8 billion over the next 6 years to maintain antiquated, outdated administrative systems An additional $600 million in new, duplicative systems An additional $200 million to maintain “as is” infrastructure environment Missed opportunity to redirect 50% to 70% of these costs into re-engineering and improving government service programs

15. 15 expect the best www.vita.virginia.gov Where Are We Trying to Go—Future State Shared, modern and more efficient administrative systems Standard technology platforms to take government service delivery to new levels Adequate security of Commonwealth assets and a secure data center More enterprise vs. duplicative systems Greater efficiencies, optimal use of resources and improved services Common, integrated, and secure enterprise network

16. 16 expect the best www.vita.virginia.gov Where Are We Trying to Go—Future State Standardized messaging and communications systems Server consolidation (3,000 to <1,000) Helpdesk consolidation (70+ to 1) Reduce costs over the long term and spend taxpayer dollars more wisely Bottom line ____________________________ Consistent performance Consistent Service Predictable Cost

17. 17 expect the best www.vita.virginia.gov How Do We Get to The Future State? The Commonwealth faces significant challenges: –Funds to support a $500 million investment in changing the way we do business –Culture is agency-centric vs. enterprise oriented –Sheer size, scope, and complexity of transformation –Lack of tools and resources to do the heavy lifting One option under evaluation is a public/private partnership

18. 18 expect the best www.vita.virginia.gov Partnership Rules of Engagement Employees MUST be treated fairly and equitably No additional GF or taxpayer dollars No impact on our bond rating Must have skin in the game—investment & risks Must provide value to citizens –Economic development in Southwest / Southside Provide more efficient and modern IT environment that improves services No increased cost over our FY05 baseline expense level

19. 19 expect the best www.vita.virginia.gov PPEA—Status Infrastructure PPEA Status –Two vendors under review that met those conditions IBM ● Northrop Grumman –Detailed review completed, but slightly behind schedule –Steering committee recommendation pending ITIB review and approval Enterprise Applications PPEA Status –Detailed proposals received August 8 –Review to be completed with recommendation to ITIB September 8

20. 20 expect the best www.vita.virginia.gov PPEA—Participation Highly collaborative review of infrastructure and enterprise applications –85 individuals representing 21 agencies 3 cabinet Secretaries and 2 deputies 7 agency heads –Council on Technology Services Workgroup –Independent review Gartner Gordon & Glickson McClain Group (Enterprise)

21. 21 expect the best www.vita.virginia.gov Value Highlight Before Transformation No major project failures since July 2003 Reduction of investments in duplicative, standalone solutions (LMS, Licensing, GIS, Security, etc.) Cumulative cost savings and avoidance to customers of $56.4 million in FY04 & FY05 Integrated IT infrastructure functions of 90 executive branch agencies Annual review and prioritization of Commonwealth IT investments by the ITIB Commonwealth IT standards, policies, and procedures built on industry best practices

22. 22 expect the best www.vita.virginia.gov CIO Status Report Supplemental Materials

23. 23 expect the best www.vita.virginia.gov Quarterly Highlights Held VITA Dialogue meeting on June 9 on Transformation; next meeting planned August 11 As a result of receiving a large amount of cash payments from customers, VITA's treasury loan was repaid – ahead of schedule – on June 30 Published and distributed VITA Quarterly Report on July 1 Delivered CIO briefing to ICG on July 12 Leslie Carter was lunch keynote speaker at National Minority Technology Council conference on July 15 Transformed service delivery to the Governor’s Office and Cabinet, beginning July 25 Earned Meridian Customer Award for “Best Launch of the Knowledge Center” for the enterprise Learning Management System on July 28

24. 24 expect the best www.vita.virginia.gov Infrastructure Current Status MilestoneStart DateEnd DateStatusComments Program Planning1/10/20051/27/2005 Develop plan for the detailed review of the VITA PPEA infrastructure proposals. Conduct initial planning meetings. Establish Infrastructure PPEA Steering and Finance Review Committees. Due Diligence1/27/20054/15/2005 Establish the base case/current processes and automated systems which support them. This task has been COMPLETED. Draft SOW/SLA/Ts & Cs3/28/20054/28/2005 Develop Statements of Work (SOW), Service Level Agreement (SLA) expectations and draft terms and conditions. Provide to proposers for completion of detailed proposals. COMPLETED Develop Detailed Proposals4/29/20056/20/2005 Proposers develop detailed proposals in response to base case, SOW/SLA and Terms & Conditions Review Detailed Proposals6/21/20058/10/2005 Commonwealth team reviews detailed proposals Negotiate Comprehensive Agreement 8/11/200510/15/2005 Negotiate Comprehensive Agreement (CA) for infrastructure services. Status Yellow because Finance Committee has informed us the agreement may require Treasury Board and General Assembly approval.

25. 25 expect the best www.vita.virginia.gov Enterprise Applications Current Status MilestoneStart DateEnd DateStatusComments Start-up3/22/20054/11/2005 Develop Plan for the detailed review of the PPEA Enterprise Applications proposals. Conduct initial meetings with IBM and CGI-AMS. Establish program organization, to include steering committee. COMPLETED Due Diligence4/11/20056/23/2005 Establish the base case, including current processes and the automated systems which support them. Draft SOW/Ts & Cs5/2/20056/23/2005 Develop Statements of Work (SOW) and draft terms and conditions, to define the services that the Commonwealth envisions obtaining from the offerors and the Commonwealth’s initial view of the legal details of the agreement. Release Proposal Package to Offerors 6/27/2005 The Proposal Package, consisting of the Due Diligence Data, Draft SOWs and Draft Terms and Conditions is released to the offerors Develop Detailed Proposals6/27/20058/5/2005 Proposers develop proposals in response to base case, SOW/SLA and Terms & Conditions. Evaluate Detailed Proposals8/5/20059/16/2005 Commonwealth team evaluates proposals. Negotiate Comprehensive Agreement 9/16/200510/15/2005 Negotiate the Comprehensive Agreement for Enterprise Applications and obtain senior management approval. Executive Approval10/15/2005 The Comprehensive Agreement is signed by the Governor. Status Yellow because Finance Committee has informed us the agreement may require Treasury Board and General Assembly approval.

26. 26 expect the best www.vita.virginia.gov Local Outreach Update New Customers since April 2005 –Blue Ridge Regional Jail Authority –Criminal Sentencing Commission –Hanover County –Shenandoah Valley Workforce Investment Board –Southern Virginia Mental Health Institute

27. 27 expect the best www.vita.virginia.gov CIO Major IT Project and Procurement Actions Since Last ITIB Meeting Project Planning Approval None Project Development Approval None Contract Approval Department of Social Services: Child Support Payment Processing Modernization – contract with Protech Solutions, Inc., $2 million Project Suspension or Resumption Approval None NOTE: See the August ITIB Major IT Project Status Report (provided separately) for a complete status of the Commonwealth major IT project portfolio

28. 28 expect the best www.vita.virginia.gov