1. COUNCIL ON EFFICIENT GOVERNMENT How to Create and Submit a Business Case

2. 2 Workshop Agenda 2 Section 1 - Overview - Who and Why CEG was Created Section 2 – Definition of Outsourcing and a Business Case Section 3 - Business Case Thresholds and Submission Process Section 4 - Conclusion

3. 3 SECTION 1 Overview - Who and Why CEG was Created

4. 4 New concept ?

5. 5 How the Council on Efficient Government was Created 5 The Florida Efficient Government Act of 2006 created the Council on Efficient Government (CEG) in response to a growing trend to outsource government services and jobs. CEG is responsible for evaluating business cases for feasibility, cost-effectiveness, and efficiency before an agency proceeds with any significant outsourcing of services and possible reduction of government staff. Legislative Authority: 287.0573 F.S. and 287.0574 F.S.

6. 6 Who is the Council on Efficient Government? The council is made up of seven members appointed by the Governor and they are: Linda SouthSecretary, Department of Management Services (Chairman) Alex SinkFlorida’s Chief Financial Officer Lisa Echeverri Executive Director, Department of Revenue Steve EvansChief Operating Officer, Florida TaxWatch Akhil AgrawalPresident, American Medical Depot Tim YandellPresident, inetUSA VacancyHead of Executive Branch agency

7. 7 Office of Efficient Government Team 7 The council is supported by the Office of Efficient Government which consists of: Henry Garrigo, Executive Director Evelyn Gonzalez, Analyst Noah McKinnon, Analyst Suzanne Keele, Administrator

8. 8 CEG’s Statutory Roles and Responsibilities  Establish Processes  Employ a standard process for reviewing business cases  Develop standards, best-practices, and templates  Assist in the creation of guidelines for assisting state employees whose jobs are eliminated as a result of outsourcing  Reviewing of Business Cases  Review and evaluate business cases to outsource  Provide an advisory report on projects $10 million and over  Promote excellence in contracting and outsourcing  Incorporate lessons learned into Council standards  Report on innovative methods and current outsourcing efforts

9. 9 SECTION 2 Definition of Outsourcing and a Business Case

10. 10 Florida Statute Definition of Outsourcing 287.05721(2) F.S. defines outsourcing as: The process of contracting with a vendor to provide a service or activity while the state agency retains responsibility and accountability for the service or activity and there is a transfer of management responsibility for the delivery of resources and the performance of those resources

11. 11 Outsourcing Exemptions  Florida Statute lists 18 exemptions from business case requirements. Examples include, but are not limited to: Artistic ServicesLegal Services DOT ConstructionAuditing Services Some Health ServicesTraining & Education Architectural & EngineeringLectures Other Governmental Agencies  A complete list of exemptions can be found on the outsourcing flowchart found on the CEG web site or in Florida Statutes 287.057(5)(22), 287.0571, 287.055, 337.11 and 440.491(6).

12. 12 Flowchart - Is My Project an Outsource?

13. 13 What is a Business Case?  A business case defines the expectations of the project in terms of the key benefits to be achieved by contracting out or outsourcing of services.  The business case provides a detailed analysis of the financial costs, benefits, and risks of the project.  The business case should present a clear basis for the recommendation to contract out the services.

14. 14 Creating a Business Case  Although format and content of business cases may vary, your document must communicate the intent, beliefs and risks of the project. In your document:  Be clear and concise  Be persuasive  Make it interesting  Provide a clear vision of the end result/benefit  Do your homework; prove that the agency is prepared and capable of implementing the project  Clearly demonstrate the need for the project  Communicate why the timing is appropriate

15. 15 What Should Be Included in a Business Case? -by statute 287.0574  A detailed description of the service or activity for which the outsourcing is proposed.  A description and analysis of the agency’s current performance standards.  The goals desired to be achieved through the proposed outsourcing and the rationale for such goals.  A citation to the existing or proposed legal authority for outsourcing the service or activity.  A description of available options for achieving the goals.  An analysis of the advantages and disadvantages of each option, including, at a minimum, potential performance improvements and risks.  A description of the current market  A cost-benefit analysis

16. 16 What Should Be Included in a Business Case? -by statute 287.0574  A discussion of options for or a plan to standardize, consolidate, or revise current policies and processes, if any, to reduce the customization of any proposed solution that would otherwise be required.  A description of the specific performance standards for the outsourcing  The projected timeframe for key events, from the beginning of the procurement process through the expiration of a contract.  A plan to ensure compliance with public records law.  A specific and feasible contingency plan addressing contractor nonperformance.  An agency’s transition plan  A plan for ensuring access by persons with disabilities in compliance with applicable state and federal law.  A description of legislative and budgetary actions.

17. 17 Greenhouse Gas Emissions  On July 13, 2007, Governor Crist signed Executive Order 07-126 which requires all business cases submitted to the CEG to incorporate and report energy consumption and greenhouse gas emission performance criteria, as applicable to the proposed project.  Describe how energy consumption and greenhouse gas emission performance criteria will be incorporated into the proposed project Reminder: If this requirement is not applicable to your project, state so in your business case.

18. 18 Confidential, Propriety, or Trade Secret Material  Confidential, Propriety, or Trade Secret Material:  If a business case submitter has been advised or considers that any portion of the documents, data or record submitted to be confidential, trade secret or otherwise not subject to disclosure pursuant to chapter 119, Florida Statutes, the Florida Constitution or other authority, the submitter must also simultaneously provide the Council on Efficient Government with a separate Redacted Copy of its response.  This Redacted Copy shall contain the Agency’s business case name, number, and the name of the submitter on the cover, and shall be clearly titled “Redacted Copy.” The Redacted Copy shall be provided to the Council on Efficient Government at the same time submitter submits its business case and must only exclude or obliterate those exact portions which are claimed confidential, proprietary, or trade secret.  The submitter shall have the responsibility to protect, defend, and assist the Council on Efficient Government with any and all public records requests or claims made against the Council on Efficient Government regarding portions of its Redacted Copy being confidential, proprietary, trade secret or otherwise not subject to disclosure.  If submitter fails to submit a Redacted Copy with its business case submission, the Council on Efficient Government may be required to produce the entire documents, data or records submitted by submitter in answer to a public records request for these records.

19. 19 SECTION 3 Business Case Thresholds and Submission Process

20. 20 When and How to Submit A Business Case Submission and Review Process Required Submission of INITIAL Business Case by Agency CEG INITIAL Review Process Required Submission of FINAL Business Case by Agency CEG FINAL Review Process Project CostTo WhomWhen DueInternal Review Process: To WhomWhen DueInternal Review Process: LEVEL 1 Less than $1 Million (per fiscal year) N/A CEGAfter conclusion of negotiations and at least 30 days before execution of contract. Schedule XII Checklist LEVEL 2 $1 Million to $10 Million (per fiscal year) CEG, Governor's Office, Senate President, House Speaker 30 days before issuing the solicitation CEG Business Case Review & Recommendation Form CEG, Governor's Office, Senate President, House Speaker After conclusion of negotiations and at least 30 days before execution of contract. Final business case will be reviewed and an advisory report may be issued, if deemed appropriate by staff. LEVEL 3 Greater than $10 Million (per fiscal year) CEG, Governor's Office, Senate President, House Speaker 60 days before issuing the solicitation CEG will submit advisory report to all parties within 30 days of receipt of business case. CEG Business Case Review & Recommendation Form CEG, Governor's Office, Senate President, House Speaker After conclusion of negotiations and at least 30 days before execution of contract. * Outsourced as defined in Chapter 287.05721(2), F.S.

21. 21 General Instructions on How To Submit a Business Case to CEG 21 a. Submit your initial business case to the Council on Efficient Government based on criteria specified on previous slide. b. Business cases may be submitted electronically or in hardcopy format. The email address for the office is ceg@dms.myflorida.com.eg@dms.myflorida.com c. Business cases may be prepared using the LBR Schedule XII form or may be submitted in a report format on agency letterhead. Reminder: If using the Schedule XII Form for projects over $1 million dollars in value, more information will be required than is listed on form. See CEG document titled “Business Case Development and Submission Process” for details.

22. 22 General Instructions on How To Submit a Business Case Cont. 22 d. Business cases will be reviewed by office staff using the criteria specified in “Business Case Development and Submission Process” document. e. For business cases valued at less than $10 million dollars per fiscal year, office staff will review the business case and provide a response back within 30 calendar days. For business cases valued at greater than $10 million dollars per fiscal year the Council will meet and provide an advisory report within 30 calendar days of receipt. f. Final business cases will be reviewed upon receipt and an advisory report may be issued if deemed appropriate by staff.

23. 23 CEG Standard Review Process The Council on Efficient Government employs a standard process for reviewing business cases that provides for a deliberative examination of the state agency’s proposal to outsource. Each section of the review form includes key questions that are used to determine the level of detail and completeness of the business case submission. Each section is scored based on a point system that is directly related to the level of detail provided in the business case submission.

24. 24 Workflow for Business Cases Valued at $10 Million Dollars or Greater 24 Stage 1 – Steps 1-7 Stage 2 – Steps 8-9

25. 25 SECTION 4 Conclusion

26. 26 SECTION 4 The Council  CEG is responsible for evaluating business cases for feasibility, cost-effectiveness, and efficiency before an agency proceeds with any significant outsourcing of services and possible reduction of government staff. Business Cases  Business cases are required for any procured contractual service that meet the definition of “outsource”, regardless of amount.  A business case defines the expectations of the project in terms of the key benefits to be achieved by contracting out or outsourcing of services.  The business case should provide a detailed analysis of the financial costs, benefits, and risks of the project.  The business case should present a clear basis for the recommendation to contract out the service.  CEG has reference documents to help agencies identify how to write and submit business cases.

27. 27 Office of Efficient Government 27 Upon request, CEG staff can assist agencies during all stages of project development with:  Business Case Development Tools  Lessons Learned  Successful Outsourcing Characteristics  Third Party Review  Training of Staff

28. 28 Thank You! How To Contact Us: Telephone: (850) 414-9200 Facsimile: (850) 414-6065 Email: ceg@dms.myflorida.comceg@dms.myflorida.com http://dms.myflorida.com/other_programs/council_on_efficient_government