State of Kansas Financial Management System Needs Assessment Validation

1. State of Kansas Financial Management System Needs Assessment Validation Focus Group Kick-Off Meeting October 9, 2006

2. Meeting Agenda • Introductions • Project Governance • Project Overview • Key Activities • Requirements Validation • Business Case Analysis • Upcoming Activities • Questions

3. STA Company ProfileStatewide ERP/eProcurement Systems State of Tennessee State of Arkansas State of Nebraska State of Texas Commonwealth of Kentucky State of Minnesota State of Wisconsin State of Texas State of Nevada

4. Project Governance Organizational Structure

5. Project SponsorsMembership • Duane Goossen • Secretary of Administration • Carol Foreman • Deputy Secretary of Administration • Denise Moore • Executive Branch Chief Information Technology Officer

6. Project SponsorsRoles & Responsibilities • Actively champion the project • Establish and cultivate legislative sponsors • Provide executive level support • Steering Committee and Project Team guidance • Monitor project progress • Provide clear direction • Ensure that the FMS initiative is aligned with the State’s strategic goals and objectives • Empower the team • Steering Committee and the Project Team • Assist with issue resolution • Resolve issues in a timely manner per the project issue escalation policy • Assist in removing obstacles • Secure required resources • Ensure funding/staff necessary to achieve project objectives

7. Steering CommitteeMembership • Chair - Carol Foreman, Deputy Secretary of Administration • Mary Blubaugh, Board of Nursing • Alan Conroy, Legislative Research Department • Gary Daniels, Department of Social & Rehabilitation Services • Elaine Frisbie, Department of Administration; Division of Budget • Kathy Greenlee, Department on Aging • Mike Hayden, Department of Wildlife and Parks • Lynn Jenkins, State Treasurer • Deb Miller, Department of Transportation • Reginald Robinson, Board of Regents • Howard Schwartz, Judicial Administrator • Joan Wagnon, Department of Revenue • Roger Werholz, Department of Corrections

8. Steering CommitteeRoles & Responsibilities • Actively participate in Steering Committee meetings • Remove obstacles to project success • Actively champion the project • Communicate project status within respective agencies • Review and provide input to final report December 11 – December 14

9. Requirements Focus GroupMembership – 25 State Agencies • Legislative Research Department • Kansas Lottery • Board of Nursing • Department of Corrections • Department of Corrections – Correctional Industries • Department of Revenue • Department of Social and Rehabilitation Services • Department of Education • State Treasurer • Judicial Branch • University of Kansas Medical Center • Kansas Department of Wildlife and Parks • Department on Aging • Department of Agriculture • Corporation Commission • Kansas Health Policy Authority • Department of Administration • Department of Health and Environment • Department of Transportation • Kansas Highway Patrol • Department of Labor • Department of Commerce • Juvenile Justice Authority • Kansas Public Employees Retirement System • Kansas State University

10. Requirements Focus GroupRoles & Responsibilities • Review draft baseline system requirements prior to work sessions and come prepared to participate • Participate in all assigned requirements validation work sessions and provide quality feedback to ensure requirements properly reflect State of Kansas business needs • Serve as an “ambassador” for state agencies not in attendance. • Participate in final review of requirements during Agency Outreach sessions

11. Project OverviewWhat is ERP? FMS? Enterprise Resource Planning (ERP) – A comprehensive suite of integrated modules delivered by a single software vendor that provides end-to-end support for statewide administrative services For purposes of this study, we will use the term ‘Financial Management System’ (FMS) rather than ERP since the scope of the project includes financials and procurement only – due to current / future investment in the SHARP system FMS is a proposed solution that provides functionality similar to STARS, SOKI, Central Setoff System, and other agency administrative systems, but in a fully integrated manner

12. Project Overview Why FMS? • Satisfy the needs of the agencies • Eliminate the proliferation of stand-alone agency systems • Avoid the cost associated with new agency administrative systems • Avoid the cost associated with maintenance/upgrades of current systems • Significantly improve the quality, quantity, and timeliness of information • Effective decision-making • Efficient and accurate research capabilities • Enhanced ad hoc reporting and inquiry functionality • Streamline processing and control of electronic “documents” through workflow management • Facilitates document routing, review and approval

13. Project Overview Why FMS? • Streamline and simplify State’s business processes • Financial • Budgeting • Procurement • Other administrative operations • Improve operational efficiency • Commercially-available FMS systems include many features representing best management practices • Support Web-enabled self-service • State employees • Vendors conducting business with the State

14. Project Overview Why FMS? • Replace existing disparate systems • Costly to maintain • Difficult to administer • Automate and integrate • State’s financial accounting, procurement, asset management, and other administrative business processes within a single database • Provide single point of entry • Eliminate duplicate points of data entry • Eliminate duplicate databases • Simplify reconciliation • Reduce/eliminate paper documents • Reduce paper and handling costs (e.g., vouchers) • Simplify record retention and audit compliance

15. Project Overview Why FMS? • Take advantage of technology enablers • Web-enablement • Graphical user interface • Single integrated relational database • Real-time processing • Increased functionality based on best business practices • Modular integration • Integration with desktop “office suite” software • Sophisticated reporting and query capabilities • Audit trail / “drill-down” capabilities • Workflow management and electronic approvals • Flexible chart of accounts

16. Key Activities FMS Needs Assessment • Update the system requirements for a new integrated FMS • Update the business case analysis associated with implementing a new FMS • Determine whether there is a compelling business case for procuring/implementing an integrated statewide FMS • Submit recommendations regarding: • Organizational best practices • Implementation best practices

17. Key Activities Timeline FMS Needs Assessment Update Validate Functional / Technical Requirements Project Start-Up Validate the Business Case Dec Oct Sept Nov Business Case Analysis Report Updated Needs Assessment Organization / Implementation Best Practices Key Deliverables

18. Project OverviewProposed FMS Functional Scope • PROCUREMENT • Solicitations (RFx) • Catalog Procurement • Reverse Auctions • Inventory Management • Commodity Management • Vendor Management • CORE FINANCIAL • General Ledger / Budgetary Control • Accounts Payable • Accounts Receivable & Cash Receipting • Cash Management • Cost Allocation • Grant Accounting • Project Accounting • Asset Management • HR / PAYROLL • Automated Interfaces to/from SHARP Common Database • BUDGET DEVELOPMENT INTEGRATION • Appropriation Budget

19. Project ScopeUpdate / Validate FMS Requirements Functional and Technical Requirements Development Process Requirements from 2001 Needs Assessment Study Baseline Draft Final Focus End User Community Project Team Requirements Requirements Requirements Group STA Requirements Toolkit

20. System Requirements Validation – Guidelines • Focus on what the system must do – not how. The system design will be completed after product selection. • Emphasize process change in lieu of software modifications to protect software warranties and facilitate future system upgrades. • Develop the system requirements at a level of detail required to differentiate among available products • Provide one requirement, not multiple requirements, per line item • Document each requirement in such a way as to support proper validation

21. System Requirements Validation – Objectives • Included in Request for Proposal and used as a checklist against which to evaluate vendor offerings • Made part of the contract entered into with the selected vendor(s) • Monitored during implementation to ensure all requirements were met and that work was not performed to develop functionality that did not support the documented requirements

22. System Requirements Validation – Organization • Functional Requirements • General Ledger and Budgetary Control • Asset Management • Accounts Payable • Accounts Receivable and Cash Receipting • Cash Management • Cost Accounting / Allocation / Activity Based Costing • Grant Accounting • Project Accounting • Purchasing • Inventory Management • Budget Development

23. System Requirements Validation – Organization • General and Technical Requirements • Technical & Architectural Requirements • System Performance • Security • System Navigation and User Friendliness • System Management • Automated Workflow & Electronic Approvals • Reporting and Data Warehouse • Data Conversion Requirements • More data converted, greater expense and risk to State • Determine data conversion vs. data archive needs

24. System Requirements Validation – Organization • Interfacing Systems • Target Systems • Interface Description • Direction of Transmission • Data Transmitted • Triggering Event • Frequency of Interface • Type of Interface • Level of complexity

25. System Requirements Validation – Sample Requirements

26. System Requirements Validation – Vendor Response Codes • SF = Standard functionality • NR = Provided in Next Release • MI = Minor Modification • MA = Major Modification to Source Code Required • RQ = Provided through Reporting or Query Tool • CD = Custom Development • TP = Third Party Software Required • NA = Cannot Meet Requirement

27. Upcoming Activities • Validate Functional &Technical Requirements • October 2 – November 21 • Obtain Stakeholder Input and Approval • November 30 – December 7 • Conduct Agency Outreach Sessions • December 7 – December 14 • Updated Needs Assessment • December 11

28. Ongoing Project Information http://da.ks.gov/ar/fms/

29. Questions?