Joint Purchasing Project

1. Joint Purchasing Project DCCVA Update Wednesday, November 29, 2012

2. Agenda • Overview of Our Process • Executive Summary 0. Who Else Is Doing This? I. Joint Purchasing Structure and Process II. Purchasing Policy • Next Steps • What We Need From You

3. Improvement Approach Proposed Project q u a l i t y i m p r o v e m e n t m e t h o d o l o g y Organize Team Define Measure Analyze Improve Control 0 1 2 3 4 5 Improvement Project Implemented Track, Update, and Provide Status 0.0 ORGANIZE TEAM • What’s the high-level problem, goals, and objectives? • Who’s should be on the team? • Meeting Logistics 1.0 DEFINE • What’s the problem? • Who’s the customer? • What do they need? 2.0 MEASURE • How big is the current problem? • How often, when, how many, etc? 3.0 ANALYZE • Why is the problem happening? • How do you know? 4.0 IMPROVE • Develop Solutions • Redesign Process • Develop Recommendations • Approval • Implement 5.0 CONTROL • How will you make sure it will stick?

4. Executive Summary • 0.RESEARCH WHO ELSE IS DOING THIS? • State • UW • City of Madison • Other Purchasing Groups Joint Purchasing Recommendations We seek to establish for Dane County cities and villages a centralized purchasing system that effectively and efficiently directs the available resources I. DEVELOP PURCHASING PROCESS & STRUCTURE Sponsor Organization, Steering Committee, Purchasing Core Team Determine Primary Contacts / Owners Develop Guidelines / Framework Define Process Oversee Quarterly Purchases • II.STANDARDIZE PURCHASING POLICIES • Standard language • Standard expenditure levels • Standard statement regarding Cooperative Purchase Agreements • Language that you don’t need separate quotes and bids • Designated lead / representative to Opt In / Out • Local Vendor Preference Policy • III. SET-UP SUCCESS MEASURES AND REPORTING • By Item: • Last 3 year $ spend • Primary Contact • Interest in Cooperative Buy • Specifications / Special Requirements • $ Savings • “Money Left on the Table” Report

5. Who Else Is Doing This?What specific organizations are involved in the purchasing process? • State DOA – Vendornet • Value4gov.org – Southeast Wisconsin Collaborative Purchasing Group • UW Madison System – Material Distribution Service • City of Madison • Monona, Verona, Middleton – Records • Monona & Verona – Shared inspector • Dane County – we all buy salt • Group of Municipalities in Milwaukee – Purchase Card Program • School Systems? • Federal – only when it’s Federal grant • Services with Dane County • DaneCom– buying communications system together • WAPP – Wisconsin Association of Public Purchasers • Case Studies • 13 Counties did joint purchase of ballot bags • Eau Claire and Eau Clare have joint purchasing manager position

6. State Purchasing Program

7. State Purchasing Program Example

8. State Purchasing Program Example

9. Fuel Example Unl87 Mid 89 Madison $3.008 $3.115

10. State Purchasing Program

11. Value4gov.org

12. Value4gov.org

13. Joint Purchasing Team Structure The Project Champion is the point person for the Joint Purchasing team. They ensure the appropriate people in their organization is aware / involved in the team’s efforts. Project Sponsor Project Champion Dane County City and Villages Association Each DCCVA Member Steering Committee • Steering Committee • Region 5: Pat Marsh, City Administrator, Monona - Coordinator • Counties of: Dane, Crawford, Columbia, Grant, Green, Sauk, Richland, Iowa, Lafayette. Provides overall direction and feedback on team’s recommendations. Help to execute in their city / village. Region 5 Greater WI City Managers Association Joint Purchasing Core Team The Executive Sponsor ensures alignment with organizational strategies and provides high level direction to the project. Has ultimate authority over the project and is responsible to the business for its success. The Executive Sponsor secures project funding, resolves issues and risks at the executive level, and is a champion of the project across the organization. Executive Sponsor Bob Miller The Business Owner has ultimate responsibility for the overall business success of the project (processes and systems). Owns business decisions throughout the project, ensures that stakeholders are appropriately engaged, and that the project results meets the needs of the business. Has ongoing ownership of the project deliverables/results Business Owner Team Lead Pat Marsh Verona City Manager Cottage Grove Village Administrator Middleton City Administrator Stoughton Clerk / Per. Director City of Madison Purchasing Services Middleton Intern Bill Burns Matt Giese Mike Davis Nick Probst Monette McGuire Stephen Bechler Facilitator Reinvention, LLC Co-Facilitator City of Oshkosh Co-Facilitator State of Wisconsin Co-Sponsor and Support WCPE Co-Sponsor and Support Walter Jankowski Brian Chapman Pam Hoffman Liz Menzer Gary Becker

14. 1.0 DefineProject Definitions Problem Statement In one sentence, what’s the problem? The cities and villages of Dane County have not taken advantage of market competition opportunities available through joint purchasing. Project VisionSo, what is the desired future state or vision? We seek to establish for Dane County cities and villages a centralized purchasing system that effectively and efficiently directs the available resources. Joint Purchasing Project

15. 1.0 Define Project Charter: Joint Purchasing Pam

16. Joint Purchasing Program Structure • Guidelines / Framework • What are the fundamental guidelines / framework of the program? • Opt in / Opt out • When opting in – you are committing to purchasing from contract • Guideline: If an organization “opts out” purchase should be with 5% of joint purchasing contract • Price structure will be based on volume • We will leverage existing processes and technologies when it makes sense • Quarterly Municipal Purchasing Organization (MPO) Meetings • What do we purchase together this quarter? • Assign lead agency – they take a % for administering contract (if applicable) • Defined communication structure Joint Purchasing Project

17. Joint Purchasing ProcessHigh-Level Process for Purchasing Common Items Draft Joint Purchasing Opportunities j o i n t p u r c h a s i n g p r o c e s s 1 2 3 4 5 6 Identify Potential Purchase Items Gather Specifications and Data Research Existing Contracts Compile Best Deals, Options, & Recomm. Communicate to Partners Commit & Purchase / Contract Joint purchase 7 Track, Update, and Provide Status 1.0 IDENTIFY POTENTIAL PURCHASE ITEMS • Select high-gain commodity items • Assign item lead on team 2.0 GATHER SPECIFICATIONS AND DATA • For each Item: • Identify key purchasing lead / contact • Last 3 year $ Spend • Special requirements • Are you interested? 3.0 RESEARCH EXISTING CONTRACTS • State Contracts • Value4gov.org • City of Madison • Other 4.0 COMPILE BEST DEALS, OPTIONS, & RECOMM. • What are the best prices • Spec. options • Recommendations 5.0 COMMUNICATE TO PARTNERS • Communicate to all buyers • Recommendations • When decision is due • Next purchase items and date 6.0 COMMIT & PURCHASE / CONTRACT • Each community commits go/no go decision • Make purchase 7.0 TRACK, UPDATE, AND PROVIDE STATUS • By Community • Participation Rate • $ Savings • $ “Left on the Table”

18. Potential Product Purchase Items Joint Purchasing Project Brian

19. Potential Service Purchase Items Joint Purchasing Project

20. Standardize Policies • Develop recommended standard policy language • Standard statement regarding Cooperative Purchase Agreements • Recommend standard expenditure levels that are compliant with State statutes • Include “if you buy from consortium” you don’t need separate quotes and bids • Designated lead / representative to Opt In / Out • Local Vendor Preference Policy (if opt out – local vendor must be within 5% of recommended cost)

21. Next Steps and Timeline Draft Joint Purchasing Project

22. What We Need From You • Your Feedback • Support Our Efforts • As Project Champion, YOU will get initial e-mail • Assign Primary Purchasing Contact in Your City / Village • Could be you • Coordinates filling out specific item survey • Coordinates Go / No Go decisions • Assign Primary Contact for Each Item • Timely Responses from Everyone • Participate! • Again, Your Feedback

23. QUESTIONS DCCVA Update Wednesday, November 29, 2012