Shared Services: Approaches T hat Work! The Province of Nova Scotia

1. Shared Services: Approaches That Work! The Province of Nova Scotia 2013 NASACT Annual Conference, Boston MA August 12, 2013

2. What we’ll cover About Nova Scotia Overview of Nova Scotia’s ERP Shared Services Initiative Stakeholders Rationale Approach Realized Benefits Lessons Learned

3. A little about Nova Scotia… New Scotland, Acadians & Cajuns “Burial of the Hatchet” Always within 46 miles of Atlantic Atlantic time zone Population: ~1M 2nd most densely populated province Largely resource-based economy 1 of 4 original Confederation provinces “14th American Colony”

4. Nova Scotia’s ERP Shares Services Initiative • Collaborative environment where provincial government and other public sector organizations share • common business processes, • software, technology • support organization • Backbone is one ERP platform operating a shared services model across sectors • ERP software selected based on incorporation of best business practices and continued R&D investment to keep pace with IT & practices change • Viewed as a ‘business project’ not an “’IT project’

5. Stakeholders Province Local Govt Health Higher Ed Schools

6. Rationale: Legacy = Chaos Local Govt Health Higher Ed Province Schools A fragmented system is ineffective at management decisions and is costly to maintain… no matter how much effort we put into making systems communicate and work effectively.

7. Rationale: Objective = “Order” Province Schools Local Govt Health Higher Ed Materials Management Plant Maintenance Procurement Human Resources Payroll Financials

8. Rationale: Value Proposition Constituents & Business Community eService Delivery Tools Province Schools Local Govt Health Higher Ed Other Back Office Modules Materials Management Plant Maintenance Procurement Human Resources Payroll Financials Other Management Tools e.g. Business Intelligence

9. Rationale: Current state Constituents & Business Community eService Delivery Tools Province Schools Local Govt Health Higher Ed Other Back Office Modules Materials Management Plant Maintenance Procurement Human Resources Payroll Financials Other Management Tools completed underway

10. Approach: Groundwork • Requests for Proposals/Unsolicited Proposal – Y2K an inflection point • Decision to pool resources between City of Halifax and Province • Vision and long term outcome • Capital Investment in software and infrastructure • Establish ERP as standard, SAP First Direction legislation • SAP Program Office • Business cases, selling, maximizing the investment (advancing opportunities), quality reviews and setting strategic direction • Cost recovery for support & software maintenance (some)

11. Approach: Governance Governance Projects Implementations Application Support Strategies & Planning Sponsorship SAP Infrastructure Management Business Process Change Provincial Departments & other Sectors Customer Competency Center SAP Program Management Office

12. Approach: Implementation • Implemented one capital project at a time (SAP PMO) • By sector with a specific scope ( dependent on available capital funding, resources, change readiness, rationale, etc.) • First implemented financials in Halifax, Cape Breton Regional District & Province • RFPs for implementation services by sector (e.g. K-12, Healthcare) • Support services may vary depending on sector • Shared Services Organization providing services across sectors • Self-sustaining • Now outsourced to IBM as Economic Development initiative

13. Approach: Architecture Within Sector Sector (e.g. Prov, K-12, Local)

14. Realized Benefits • Increased productivity and sustainability through lower TCO & predictable costs • Savings in software purchase, technology discounts, and support (cost avoidance) • Unifying procurements across sectors brings new negotiating power • Increased expertise in Province, driving down implementation costs • Effective service delivery - sectorial standardization of business processes • Increased Financial accountability, transparency and efficiency • Single view of the Province, “One Source of Truth” for improved policy and operational decisions • Foundation for Business Analytics • Creates ecosystem of Economic Development • Connects universities to existing and new local business • Improved public perception of government • Expanded ‘shared services’ culture to other practices and operations

15. Project Summary Successful Rollout All provincial departments are running on 1 system 60 percent of municipal transactions are handled in same system All 8 school boards and the 450 schools have implemented 10 health districts and 38 hospitals have implemented Realized Benefits Estimated taxpayer benefits of CDN $43M by aggregating software license purchases. The shared-service model was created to provide technology guidance and frameworks that could be replicated for all municipalities, academia, school boards and healthcare providers while respecting the requirements of operational independence QUICK FACTS • Province of Nova Scotia, Canada • Participants: Provincial Government, Municipalities Department of Education (K-12) Department of Health Academia • 86,000 users • SAP Solutions: Finance and HR/Payroll Plant Maintenance Business Warehouse NetWeaver Portal Procurement Customer Service Mgmt. “We are providing the infrastructure for the e-service access for all four audiences: citizens, businesses, other governments and employees.” Steven Feindel, Director SAP CIS, Province of Nova Scotia

16. Lessons Learned • Use innovative procurement process • Someone must lead and invest on behalf of all sectors • Requires executive ownership with a strong vision to counteract turf barriers • Encourage smaller players by offering services that could not otherwise afford • Respect operational independence across the public sectors • Create a Program Management office to set strategic direction • Create a shared services Center of Excellence for support • Determine baseline ‘as is’ costs for later TCO savings analysis • Win-Win

17. Questions?

18. Daryl Kirkland Practice Lead T: 630.518.8425 daryl.kirkland@sap.com Thank you