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Technology Purchasing Through VITA

Technology Purchasing Through VITA. Phil Pippert Associate Director, SCM VITA December 2004. Vision for procurement at VITA New method for contracting and sourcing Details on how to acquire technology Q&A. Agenda.

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Technology Purchasing Through VITA

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  1. Technology PurchasingThrough VITA Phil Pippert Associate Director, SCM VITA December 2004

  2. Vision for procurement at VITA New method for contracting and sourcing Details on how to acquire technology Q&A Agenda

  3. With integration of executive branch agencies complete, VITA is responsible for supporting: 90 Organizations at 1,497 locations 60,000+ end users 3,000+ servers 1,286 employees VITA - post integration

  4. Objectives of change 1.7B Why consolidate IT infrastructure: • Global position – Commonwealth would rank 50th in S&P 500 • Best practices management of the IT investment • Savings • Effectiveness Why reform technology procurement: • Leverage Virginia’s ample buying power • Implement best practices – • innovative tools and solutions • positive relationships with customers and partners • value-orientation, not price-orientation • business-driven and enterprise-oriented • standardized contracts • Increase usefulness (and use) of statewide technology contracts 1.4B Agency Citizen Services 1.2B .9B 6 Year Infra- structure Agency Citizen Services Infra- structure Baseline TODAY TOMORROW • Make Virginia much easier to do business with!

  5. Specific goals of ProReform • Centralized • Solutions-based • “Business-driven” terms and conditions • Emphasis on partnerships • Encourage diversity of subcontractors • Innovative public/private partnerships • Facilitate development of SWAM businesses • Faster, simpler, less expensive procurements • eVA for electronic, on-line procurement • Mandatory, statewide contracts for most IT goods • Positive relationships between VITA and its IT suppliers

  6. Governor’s management objectives • Information Technology • Implement full and uncompromised consolidation of all state agencies into the Virginia Information Technologies Agency (VITA) as scheduled. • Electronic Procurement • Achieve $3 billion per year spend through eVA, all with registered vendors, using the full range of advanced eVA electronic procurement tools to double the current yearly spend. • Leveraged Purchasing • Triple spending on statewide leveraged contracts across the board, increase the number of such contracts, and increase the absolute number of local governments participating in eVA and leveraged contract purchasing. • Small, Women- and Minority-owned (SWAM) Business Procurement • Implement agency procurement plans to achieve statewide SWAM aspirational procurement goals. • Administrative Dispute Resolution • Conduct six major pilots under the tutelage of the ADR Council and achieve 25-30% statewide increase in the use of ADR processes, as measured by the council’s annual survey.

  7. Vision of VITA Supply Chain Management (SCM) Category Management Demand Management Sourcing & Contracting Procurement Transaction Supplier Management • Integrate with category owners and define strategy for spend • Make vs. buy • Flexibility of supply chain • Level of consolidation • What are we spending – leverage volumes or need • Specifications • Standardization • Demand reduction • Coordination across groups • Highest Value to cost solutions • Determine new suppliers • Allocate risk between supplier and Commonwealth • Team based selection process • Maximize buying power • Standard contracts • Efficiency and effectiveness • Minimize transaction cost • Maximize ease and accessibility • Data/information available • Accurate • Transparent • Sustainable relationships that are a source of value • Fact-based cooperative relationships balanced with commitment to competitive pricing • Harness supply chain improvement ideas from suppliers

  8. Strategy to achieve Consult Lead • Collaborate • Work on specific high-impact initiatives • VITA provided framework • Oversight • Full Service • Provide end to end assistance • Utilize best resources • Actively manage Increasing Total Value (Risk & TCO) • Self Service • Provide tools, capabilities that are easy to access • “e-enabled” & training • Monitor • Reduce resource investment Enable Provide • Partnership • Develop efficiencies • Statewide agreements • Prime contractor manage subs • Manage cycle time Increasing degree of Commonality

  9. Analytical approach to opportunity identification; market pricing determination Statewide teams with representation from stakeholder groups More standardization of configurations Resources dedicated to analytical support of procurement process Standard contract terms included in RFP Open RFP process VITA staff issued RFP response and negotiated contract terms and conditions Evaluation based on weighted criteria and scoring of the criteria VITA led contract negotiations eVa required for implementation Competitive negotiations process with limited number of suppliers What’s changed? Different Same

  10. What does this mean to suppliers? • Lower marketing costs • Ability to compete for larger, more complex engagements • Bring business solutions • Existing contracts may be consolidated • Focus on value • Increase focus on service levels, measurement and coordinated communications to develop relationship • Opportunity to grow existing relationships by bringing increasing value

  11. VITA is committed to building SWAM partnerships Raise Awareness Improve Access Encourage Feedback • Provide data • Invest resources in outreach • Formalize recognition of subcontractors • Developed small purchase procedures which promote SWAM • Solicit feedback • Monitor progress • Recognize exemplary performance • Benchmark effectiveness • Create SWAM policy • Include procedures for solicitations • Establish goals • Providing training • Inform SWAM suppliers of opportunities

  12. Contract Templates SCM is finalizing contract templates for the following: • Hardware with maintenance • Hardware without maintenance • Service • Software license • Service level agreement New characteristics of our templates • Limit “mandatory” Ts & Cs to those required by Code – all other Ts & Cs negotiable • Code driven Ts & Cs not included in body of contract, but referenced to URL • The parties, the “deal” and pricing are apparent in the four corners of the contract - not lost in 300 pages of RFP and proposal

  13. Benefits • Contract templates represent a significant step toward achieving consistency in contract management • All SCM sourcing consultants have same contractual starting point • Templates provide greater consistency and more efficient risk management yet are adaptable to each deal • The contract will memorialize the deal within the 4 corners of the document • Plain and clear language, consistent structure • Contract stands alone – RFP and proposal not included • Balanced – promotes fact-based versus positional negotiation • Supplier and Commonwealth provided greater predictability • Removes guesswork from contract management • Promotes more efficient contract administration

  14. Functional Technical Pricing Ts & Cs Strategic Sourcing • Emphasis on engaging early with client • Accurately identifying needs (requirements) • Cross functional teams - led by SCM, but requiring functional and technical SMEs • Utilizing RFP and contract templates • Evaluating proposals – best value for the Commonwealth • TCO - not just price • Provisioning through eVA • Execute contract – initiate contract management process

  15. Strategic Sourcing • Contract is introduced early in the sourcing process and is integral to supplier selection • Contract used in proposal evaluation • Promotes early risk identification and mitigation • Fewer resources needed to reach better decisions • Reduces overall cycle time - process will be smoother, more predictable, with fewer surprises • Incorporates commercially standard contracting language and practices: new to state government, but familiar to suppliers • More effective service level agreements • Performance based-contracting • Agreements become the basis for ongoing supplier relationship management - may include ongoing cost reduction and performance improvement expectations

  16. How will IT procurement change day to day • Delegation • Sole Source • GSA • Ordering • Contracts

  17. Delegated Authority – IT Procurements

  18. Sole Source requests aligned with delegation

  19. If there is no statewide contract… • If the amount of your IT purchase is between $0 and $5,000 – • You may purchase based upon receipt of one written or telephone quote – with at least one quote from a woman or minority owned business. • You may also use eVA’s e-Mall or Quick Quote capabilities to obtain the quote for the IT product or service you need. • Then place your order through eVA. • If the amount of your IT purchase is between $5,000 and $15,000 – • Use eVA’s Quick Quote capability to solicit six (6) quotes, to include a minimum of four (4) quotes from SWAM businesses. • Then place your order through eVA. • If the amount of your IT purchase is between $15,000 and $30,000 – • Use eVA’s Quick Quote capability to solicit eight (8) sources, to include a minimum of six (6) quotes from SWAM businesses. • Then place your order through eVA. • If your IT purchase is between $30,000 and $50,000 – • Agencies and institutions may obtain IT goods or services using a written informal Request for Proposals or an unsealed written Invitation for Bid. Solicit eight (8) sources in writing. • Your sources should include a minimum of six (6) quotes from SWAM businesses. • All solicitations over $30,000 must be advertised in eVA. • http://www.vita.virginia.gov/procurement/howDoI.cfm

  20. Use of GSA Schedule 70 • Statewide agreements should always be used prior to GSA Schedule 70 • Intent is to use as stop-gap, one-off agreements • Use eVA if possible

  21. How IT Procurement has changed • Infrastructure IT assets transfer to VITA • Newly purchased in-scope items owned by VITA • Agency orders based on need • VITA buys and pays for them and direct bills agency • Software licenses (with the exception of agency specific apps) transfer to VITA • Incidentals/consumables provided by the agency • VITA personnel located in an agency may have a charge card for small dollar, urgent requests

  22. In-Scope Goods and Services • Computer Hardware and Peripherals for Microcomputers - Almost everything is in-scope except Digital Cameras, Miscellaneous Peripherals (mice, pen pads, trackballs, etc.) when not acquired with the original system, Magnetic Strip Scanners and Readers and Bar Code, Remittance Scanners and Readers (to eliminate security systems and the like). • Computer Software for PCs, Servers and Mainframes - Software that could be viewed as potentially "enterprise" software is in-scope (accounting, purchasing, spreadsheets, etc.) while agency specific type applications are out-of-scope (educational, point of sale, real estate/property mgmt., etc.) • Computer Hardware and Peripherals for Servers and Mainframe Computers - all in-scope • Computer Accessories and Supplies - all out-of-scope except Power Supplies, Computer Room and Microprocessors • Radio Communication, Telephone and Telecommunication Equipment, Accessories and Supplies - Most in-scope (everything that currently falls under a TSR would still be in-scope) generally excluded Radio Equipment, Nurse Call Systems, Broadcasting Systems and the like. • Office Equipment - all out-of-scope • IT Goods/Services - Firewalls, Data Centers and Data Center Consultants in-scope; Call Center Facilities, IT Training and Conferences out-of-scope • IT Contractors and Consultants and Services - followed the intent of other categories - programming, data entry, etc., out-of-scope; Emergency Back-up Services and Facilities (DR), Networking Services, etc., in-scope • http://www.vita.virginia.gov/integration/latt/documents/workbook/SCM-ITGoodsandServicesListv1.3.xls

  23. How to Order IT Products • Leveraging eVA’s enterprise wide scope • Requisitions entered into eVA • Approved by agency person authorized (AITR) • Main difference is addition of V-Code and different “ship to” and “bill-to” locations • Requisition routed through eVA workflow if desired by agency • Delivery will be made to the agency • Receiving will be done in eVA • Invoice sent to VITA and paid

  24. Contract Transition • All IT contracts (except Agency Specific Software) have become VITA contracts • VITA will manage all contracts except agency-specific, after transition • Suppliers are being sent letters to notify them that VITA will be managing the contract • VITA is integrating all the transitioned contracts into our contract database • SCM has analyzed over 1,100 contract items • Approximately 400 contract items expired prior to transition • SCM is awaiting notification from the agency as to whether or not the contract has been renewed – process through eVA, notify SCM of renewal for future notifications

  25. What Businesses Need To Do • Register in eVA • SWAM also certify with DMBE • Market your firm • Compete for business • Deliver as required • Strive to exceed the customer’s expectations • Demonstrate long-term value to the relationship

  26. More Information Web Site http://www.vita.virginia.gov/procurement/procurement.cfm Supply Chain Management (SCM) Contacts Susan Woolley Director 804-343-9004 Phil Pippert Associate Director 804-371-5945 Kelley Hellams Manager 804-343-9024 J. B. Edmonds Manager 804-371-5948 Tim Moore Manager 804-371-5972 Joe Parr  804-371-5991 Doug Leslie  804-371-5213 Doug Crenshaw 804-371-5993 George Goodman  804-371-5990 Bob Gleason  804-371-5923 John Tackley  804-371-5930 Ann Sells 804-371-5988 LaVerne Branch  804-371-5992 Mike Novak  804-371-5563 Carmen Holmes  804-371-5614 Jan Giffin eVA Consultant  804-371-5919

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