Purchasing Directors’ Meeting August 7, 2003 3:00 P.M.

State Purchasing Purchasing Directors’ Meeting August 7, 2003 3:00 P.M.

Purchasing Directors’ Meeting August 7, 2003 Agenda • Welcome / Meeting Overview • Legislative Update • EXPO • State Purchasing Reorganization • Training and Certification Program • Strategic Sourcing • Operational Issues • Open Floor / New Issues • Next Meeting Location / Time

Purchasing Directors’ MeetingLegislative Update DMS Point of Contact Lisa Hurley, Esq. (850) 488-3213 HurleyL@dms.state.fl.us

Purchasing Directors’ MeetingFlorida Government EXPO Update Florida Government EXPO September 24-26, 2003 Tampa Convention Center DMS Point of Contact John Kuczwanski (850) 414-6736 FloridaGovernmentEXPO@myflorida.com Click on Florida Government EXPO under Hot Topics at www.myflorida.com (http://www.floridagovernmentexpo.com/)

Purchasing Directors’ MeetingFlorida Government EXPO Update Purchasing related workshops • Wednesday 2:00 – 3:00: Rules Workshop • Thursday 10:00 – 11:00: Guest Speaker, Larry Giunipro, Practical Benefits of e-Procurement • Thursday 4:30 – 5:30: Purchasing Directors’ meeting

Purchasing Directors’ MeetingFlorida Government EXPO Update • Employee development workshops, e.g., Change Enablement, Team Leadership and How to Motivate Employees. • One-on-One sessions coordinated by OSD. Governor’s agencies on the agenda. If you would like to be included, please let us know. • Time allotted time purchasing personnel to visit exhibit hall to meet with vendors. • Encourage your vendors to participate through sponsorship, participating in the exhibit hall, or attending. We have scheduled workshop geared toward vendors wishing to do business with the state. • Distribute employee card to your personnel (DMS to forward)

Purchasing Directors’ Meeting State Purchasing Reorganization • Mission – To gladly deliver useful and innovative purchasing services in order to become a customer focused agency providing effective and efficient customer services • Mission Goal - Recruit at least four employees highly esteemed by their peers before October 2003, and reduce annual turnover by 50% • Mission Task – Reorganize division

State Purchasing ReorganizationNew State Purchasing Employees • Russ Rothman • Elaine Atwood – new Bureau Chief leading Teams 1-3. Eight years state contracts/purchasing and supervisory experience with two different agencies. • Stu Potlock, B.S., CPPB – new Purchasing Analyst. Eight years state experience, seven in purchasing, with two different agencies. • Mark Lovell, B.S., CPPB – new Purchasing Analyst. Five years state purchasing experience. Thirteen years private sector management experience. • Ommet Mbiza, M.B.A – new Purchasing Specialist. Has started and managed business in Africa and the U.S. • Renee Gregory – new Purchasing Specialist. Six years state purchasing experience with three different agencies. • Chris Kincaid, B.S. – new Purchasing Specialist. Started own internet-based business specializing in musical instruments and worked in family business.

State Purchasing ReorganizationINTERIM To-Be Organization Structure

State Purchasing ReorganizationTeam Members Team 1 Jim Den Blyker – Auto & Marine David Bennett, MBA – Energy Rob Butler Team 2 Ellen Potts – Furniture Maureen Livings – Food Brenda Wells Team 3 Charles Beall – MRO, Equipment Mark Lovell – Law Enforcement Kimberly Hall

State Purchasing ReorganizationTeam Members (cont.) Team 4 David Comer – Computer Hardware Stu Potlock – Software and IT Chris Kincaid Team 5 Marvin Williams - Telecommunications Steve Poole – Office Consumables Renee Gregory Team 6 Charles Day – Printing & Office Equipment Susan Barr – Med/Lab Supplies Ommet Mbiza, MBA Team 7 Theresa Dollar – Insurance Tom Butler – Professional Services Wendi Sellers

State Purchasing ReorganizationOperations Manager – Customer & Vendor Satisfaction Victoria Chambers ChambeV@dms.state.fl.us

Purchasing Directors’ MeetingTraining and Certification Program Excellence in Contracting Audit Report: Undertake a statewide training initiative, and include incentives to encourage professionalism and certification DMS Primary Contact Fran Brooks Office of Organizational Development BrooksF@dms.state.fl.us (850) 488-2187

Statewide ProcurementTraining and Certification Program

Training and Certification ProgramGoals and Objectives • Develop and deliver a training & certification program for state procurement professionals • Establish curriculum and announce course offerings • Track participation and completion • Incorporate best practices • Linkage to MyFloridaMarketPlace • Support a network of experts • Research and recommend incentives to encourage professionalism and certification (may require legislative approval) • Improve the quality of the state’s procurement program and practices

Training and Certification ProgramStrategy • Inventory knowledge, skills, abilities (licensures, registrations, and certifications) • Establish criteria for each functional level (career pathing plans) • Review available funding for training and/or incorporate requests into Legislative Budget Request • Establish Key Performance Indicators -- Metrics and Measures • Coursework completed within 18 months to 36 months

Training and Certification ProgramIntegrated Program Management Training • Overview Course • Planning Course • Procurement Course • Performance Course • Certification Courses • Enhance the knowledge and skills of state employees involved with procurement and project management

Training and Certification ProgramOverview Course Objectives • No prior procurement or contract/project management experience is required • Overview of coursework and certification training program • Senior level management • New Purchasing employees • Employees who plan on taking a core course or are seeking certification

Training and Certification ProgramPlanning Course Objectives • The value of proper planning to future performance • In conducting a procurement • In managing contract performance by a vendor • Who should be involved in a procurement/contract/project team • Various facets of risk • Risk Assessment as a prelude to a go/ no go decision for a procurement/ contract/project • How risk causes avoidance and higher costs

Training and Certification ProgramPlanning Course (continued) • Issues to consider when constructing specifications • Procurement perspective • Contract management perspective • Balancing the competing factors of time • Proper planning saves time

Conduct pre-bid / pre-proposal conference Prepare and distribute minutes of these conferences Amend a solicitation after issue Respond to vendor questions Postpone a bid / proposal due date Receive and open bids and proposals Conduct discussions / negotiations with offerors Resolve tie bids Request best and final offers Training and Certification ProgramProcurement Course Objectives

Debrief an unsuccessful offeror Handle protests and appeals Obtain agency and DMS approvals Maintain a procurement file Resolve late bids Determine non-responsiveness and vendor responsibility Resolve with mistakes in bids Handle Requests for Public Records Training and Certification ProgramProcurement Course (continued)

Accept a vendor’s product or deliverable Invoke liquidated damages Release a bond Withhold payment / suspend work Terminate a contract for convenience Terminate a contract for default Accept contractor assignments (sale, merger, etc.) Training and Certification ProgramPerformance Course Objectives

Assure compliance with MBE and Office of Supplier Diversity Refine a contract management plan Refine a contract performance checklist Resolve contractor performance problems Issue change orders Training and Certification ProgramPerformance Course (continued)

Evaluate contractor performance Transition between contractors Insure run out requirements are satisfied Revise specifications to apply lessons learned for subsequent procurements Training and Certification ProgramPerformance Course (continued)

Training and Certification ProgramCertified Professional Public Buyer (CPPB)

Training and Certification ProgramCertified Professional Public Buyer (CPPB) Schedule D - Master's Degree or Ph.D., 3 college credit hrs in purchasing courses, 24 contact hrs in purchasing seminars or any combo thereof, 2 yrs of current public purchasing experience

Training and Certification ProgramCertified Public Purchasing Officer (CPPO)

Training and Certification Program Next Steps • Agency volunteers to assist with curriculum review • Agencies submit sample training materials by September 10 (to BrooksF@dms.state.fl.us) • DMS provide agencies sample form to inventory certifications, training needs, experience, and educational achievement for purchasing professionals • Update at next Purchasing Directors meeting

Leverage State-Wide Volume Obtain Best Prices & Value Obtain State-Wide Savings Reduce State-Wide Supply Base Identify New STC Opportunities Increase Demand / Volume on STCs Manage Compliance Strategic Sourcing Objectives Strategic sourcing is a proactive process to leverage demand and select vendors that offer the best value.

Strategic Sourcing Benefits • Greater savings for Buyers • High volume contracts awarded to a reduced amount of vendors • Increased usage of State Term Contracts • Buyers spend less time duplicating our efforts and more time on State needs • Improved contract management • Less time spent managing vendors and more time improving contracts

DMS Lead – Tom Butler • Sourcing Event – Auction • Target STC Date – Oct. 2003 Office Supplies • DMS Lead – David Comer • Sourcing Event – ITB • Target STC Date – Oct. 2003 MRO Supplies • DMS Lead – Charles Day • Sourcing Event – RFP • Target STC Date – Nov. 2003 Printing Strategic Sourcing Wave 1

Strategic SourcingFirst Steps • Discuss current contract to identify weaknesses and strengths • Too many vendors (weakness) • Good use of web-based buying • Develop new contract strategy • Auction event • Item “lots” • Core and Non-core items • 2 Phase solicitation to pre-qualify vendors • Gather spend data to help build new strategy • Get spend data from FLAIR • Reach out to vendors and request spend data • Conduct Buyer needs assessments (interviews, surveys, etc.) • Get agency feedback on SLA’s • Construct solicitation document, get it approved and post it • Phase I pre-qualifies • Phase II leads to auction

Strategic SourcingPhase I Details • Pre-Qualified vendors using 12 “critical” questions • Minimum sales revenue, delivery times, restocking fees, number of core items provided, etc. • 42 vendors applied, 17 were pre-qualified • There were no protests (but a bunch of “non-happy” vendors) • Vendors had to submit a workbook back as their Phase I response • We spent the next few weeks analyzing the returned data • Phase I shaped and defined Phase II • The analyzed data defined the items to be bid on and the SLA’s

Strategic SourcingWhere We Are • The Phase II documentation was released July 25th • Posted in new Sourcing tool; no VBS usage • Used a “2-Stage” event in Sourcing tool to facilitate Pre-view, auction and post auction activities • Multiple emails were sent to vendors to prepare them for new bid system • Online sourcing training • Contract specific sourcing training document • Conducted conference call training events for bid tool • Vendors were given optional training for a complicated piece of the bid package • Q&A period ends today for vendors • Questions coming in steadily; answers posted on the 7th • Pre-bid materials due 8/11; Auction begins 8/13 • 2 lots = 2 separate auctions at 45 min a piece • Up to 2 vendors can win per lot (5% and vendor size rules apply)

Strategic SourcingThings I Learned • Timelines are to Accenture as air is to human beings • This is all they work on – they seem to think it is all you work on as well • Accenture knows Strategic Sourcing; you know the State • Be flexible with their ideas but remember, you are the team lead • Be prepared to meet… A LOT • See the first bullet above • Be patient with your vendors • You are decreasing the number of winners, which increases competition, which then increases emotional levels • Ask questions. A lot of them. • Accenture is more then willing to expect that you know exactly what they are saying all of the time.

Purchasing Directors’ MeetingOperational Issues • Commodity Codes • Vendor Bid System • Purchasing Offices List • Microsoft Settlement • Draft Solicitations

Operational IssuesCommodity Codes • Searchable Word document has been posted on the MyFloridaMarketPlace Roundtable Materials page • Work request has been submitted to STO to link SPURSView search function to Search Advertisements and to registration for e-mail notification, with modifications to allow search on class only and to display class and group, with item and detail an option

Operational IssuesVendor Bid System • Work is in progress to allow VBS user to select ad type to search for. Purchasing folk posting an ad already have the ability to identify by type for posting. • A drop down box will be provided for “search advertisements” with certain options: (TBD by 8/11/03)

Operational IssuesPurchasing Offices List • The Purchasing Offices list posted at http://www.myflorida.com/myflorida/business/contacts/bureaus/buylinksphonesall.html will be updated by week end (Aug. 8) with the updates received to date. • Please continue to submit any changes to your agency listing to Sarah Hamilton at hamilt@dms.state.fl.us

Operational IssuesMicrosoft Settlement • Government agencies are NOT class members in In re Florida Microsoft Antitrust Litigation, Miami-Dade County Circuit Court Case No. 99-27340 • No action necessary in response to notices you may receive about this case

Operational IssuesDraft Solicitations • “No person who receives a contract ... to perform a feasibility study …, participating in the drafting of [the solicitation], or developing a program … shall be eligible to contract with the agency for any other contracts dealing with that specific subject matter” s. 287.057(17), F.S. (2001) • “A person who receives a contract … to perform a feasibility study …, who participates in the drafting of a solicitation or who develops a program … is not eligible to contract …” s. 287.057(18), F.S. (2002) • “… made available simultaneously to all vendors…” s. 287.057(1), F.S. (2002)

Purchasing Directors’ Meeting August 7, 2003 3:00 P.M.