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Professional Development Institute 2010
Financial Management Systems – Smoothing the Implementation Process
Presented by:Dick Willett – Senior Principal, TCBA
Bill Webb – Director Public Sector, Enterprise Solutions GroupLisa Fiely, Director, Grant Thornton LLP
Professional Development Institute 2010
Why Implement New (or Upgrade an Existing) Financial System?
Because You “Have To”
Because You “Want To”
Professional Development Institute 2010
Because You “Have To”• Current System Does not Meet Mandatory
Requirements
• Discontinued or Proposed Discontinued Vendor Support (under standard maintenance)
• Requirement to Move to a Shared Services Provider
Professional Development Institute 2010
Because You “Want To”• Existing System or Legacy Systems Antiquated• Process Improvements Constrained by Existing
System• “Aging” Workforce (Loss of Domain Area Expertise in
Legacy Systems)• System not Cost Effective to Maintain• Want to Take Advantage of Newer Technology and
Functionality; e.g., Business Intelligence• Need to “Keep Up with the Joneses”
Professional Development Institute 2010
Parameters for New System Operations
• Improved Business Processes• Move from Transaction-Focused to Analysis• Compliance with Mandatory Requirements (at a
minimum)• Reduced Need for “In-House” Infrastructure Support • Move Toward Single Point of Entry• More Timely Reporting and Processing (reduction in
closing timeframes)• Ensuring Vendor Support Over Time
Professional Development Institute 2010
Assumptions for All Implementations• Gain “Quick Wins” for User Buy In• Implement Synergistic Business Flows
Together• Implement in Manageable Phases to
Improve Chances for Success• Minimize Customizations• Reduce Risk• Focus on “Self Sufficiency”
Professional Development Institute 2010
Assumptions for All Implementations
• Implement “Best Practices”• Allow for Upgrades• Defer Implementing Functions that May
Change Substantively
Professional Development Institute 2010
What Are the Headaches and Symptoms?
Professional Development Institute 2010
Three Major Areas of Headaches and Symptoms
• Getting Started
• Implementation (or Upgrade)
• Operations (Sustainment)
Professional Development Institute 2010
Requirements Continue to Change, Never Frozen
Complaints About “We Are Unique and Different from Everyone Else”
Determining Nature of the Solicitation (Software First, Services Second, or Combined)
Risk of Protest Following Award
Getting Started includes defining requirements, planning and executing the solicitation, issuing an award and beginning the project planning phase.
Typical Symptoms
Headaches in Getting Started
Professional Development Institute 2010
During implementation the risk of changing scope and new requirements are always present.
Costs Continue to Increase and Timelines Expand
Management Becomes Skeptical of Additional Funding Requests
Project Management and Planning Are Lost
Management Team Looses Ability to Say “No”
Typical Symptoms
Headaches During Implementation“Scope Creep”
Professional Development Institute 2010
With any implementation of upgrade change is inevitable and many times the biggest challenge is for users to accept and adopt the new processes.
Users Will not Accept the Changes Associated with Inherent System Functionality
Users Find Mechanisms to Delay the Inevitable
Users Believe the System Is “Vapor Ware”
Typical Symptoms
Headaches During ImplementationInability to Accept Change, Lack of User “Buy
In”
Professional Development Institute 2010
During any implementation or upgrade effort, concerns are always prevalent regarding the availability (and affordability) of internal and external resources.
Lack of Expertise in Newer Technologies Within the Organization
Need to “Retool” Existing Skills (especially if Moving to Shared Services Provider)
Retaining Existing Staff Once “Retooled”
Ability to Manage Large and Diverse Contractor Personnel
Typical Symptoms
Headaches During ImplementationResource Constraints and Concerns
Professional Development Institute 2010
Implementing a New Financial System also includes integrating legacy systems and other COTS products to the new system.
Difficulties with “Syncing Up” Legacy and Financial Systems (particularly during upgrades)
Difficulties Integrating Third Party or “Best of Breed” Solutions
Realization That Legacy System Data Lacks Integrity or Is not Needed.
Inherent “Turf Issues” Among Owners of Legacy Systems
Typical Symptoms
Headaches During Implementation“Band Aiding” Legacy Systems to New Financial
System
Professional Development Institute 2010
Once the Implementation or Upgrade is Completed, there are additional issues to address including how to maintain it.
Concerns Over Loss of Control if System “Outsourced”
Fear of Inability to Maintain New System Once Contractor Personnel Are Gone
Realization that Users Must Take Final Ownership of End Product
What Do We Do Now??
Typical Symptoms
Headaches During Operations Phase
Professional Development Institute 2010
How Can We Reduce Headaches?
Professional Development Institute 2010
Delineate Clear Lines of Responsibility as Part of Initial Planning
Document Responsibilities for Agency, Integrator and Shared Services Provider
Consider Implementing Incentives in Personnel Performance Plans
Clearly State What WILL Happen, No Exceptions (“Big Bang” vs. Phased Approach)
Cures
Reducing Headaches: Getting Started
Professional Development Institute 2010
Consider Decommissioning Oldest Systems First
Consider Outsourcing Non-Mission Critical Functions
Avoid “Best of Breed” if at All Possible
Cures
Reducing Headaches: Getting Started
Professional Development Institute 2010
Source: Gartner, 2002 IT Spend Survey
Current State of IT83% spent managing existing systems, 17% innovating
Professional Development Institute 2010
Source: Aberdeen Group, June 2001
ERP vs. “Best of Breed”The Integration Dilemma
Professional Development Institute 2010
View New Implementation as a Way to Implement New Processes and Still “Save Face”
Do not Simply Replicate Old Processes, Consider Implementing Standard Business “Flows”
Do not “Clutter New System with Historical (Particularly Closed) Data
Rely on “Iterative” Prototyping (Allows Users to “Digest” Future Business Models Early)
Cures
Reducing Headaches: Implementation
Professional Development Institute 2010
Business Flow “Accelerator” Approach Characteristics
• Relies on Pre-Defined Integrated Business Flows Based on Industry and Public Sector Best Practices
• Focuses on Processes Not Modules• Eliminates Extensive Requirements Gathering,
Vetting and Approval• Provides Application Prototype Very Early in Project
(e.g., first 30 days)
Professional Development Institute 2010
Approvals (PRS05) Purchase Orders (PRS04)Requisitions (PRS03)PR1180
Manage Non Production
Requisition
• Federal Agency needs new monitors for their desk tops.
• A Requestor creates a requisition defining the needs.
PR1182Issue A
Purchase Order
• The buyer creates a purchase order for the selected supplier of the monitors.
PR0128Authorize
Requisitions
• The department manager approves the requisition.
• Check funds, create commitment
Supplier Invoices (PRS07)PR1010
ManageSupplierInvoice
• The AP Clerk receives the invoice.• The invoice is matched against the
purchase order.• The invoice is approved for payment.
Approvals (PRS05)PR0129
AuthorizePurchase
Order
• The buyer approves the requisition.
• Release commitment, create obligation
Purchase Agent
Purchase Manager
Roles
Accountant
Requestor
Accounting Transactions to Financial Reports Flow
Non-Production Receiving (PRS06)PR1935
Receive Non Production
Goods & Services
• The non-production goods arrive at the requisitioner/ receiver’s desk.
• Two-Way or Three-Way Matching.
• Ability to control Receiving Routings.
• Receive using express transactions for fast data entry.
Send to external payment system
Professional Development Institute 2010
Flows Accelerator ApproachRapid Prototyping with Defined Deliverables
StandardPre-Defined
BusinessFlows
CRPIteration 1
StandardBusiness FlowsUsing Agency
BusinessRules
PRIORITIZED
Timebox
Timebox
Requirements“Fit” Analysis
CRPIteration 2
ProductionReady
Professional Development Institute 2010
Implement Business Case Process for Evaluating “Required” vs. “Nice to Have” Functionality
Learn to Say “NO”
Develop Strong Relationship with the Product Vendor (“They Can Be Your Best Friend”)
Cures
Reducing Headaches: Implementation
Professional Development Institute 2010
Make Sure Contractor Has Included Post Implementation Support as Part of Plan
Ensure Service Level Agreements Are in Place and Understood
Never Consider the Project Done
Begin Planning for Next Large Initiative (e.g., Upcoming Upgrade)
Cures
Reducing Headaches: Operations
Professional Development Institute 2010
Lessons Learned from the Implementation Process
Professional Development Institute 2010
U.S. Department of Education • Highlights
– Replace 53 disparate systems & comply with OMB ground rules
– Process disbursements and receivables from providers estimated at approximately 3+ Million per day.
• Solution– Oracle Federal Financials– Oracle Hyperion Planning and Budgeting
• Results– First Cabinet Level agency to “Green” in financial
management– Three unqualified audit opinions– 92% of Department’s funds have no cash differences– Eliminated use of over 2,000 legacy systems– Automating budget execution processing
Federal Civilian
Financials
Professional Development Institute 2010
AQ&
Professional Development Institute 2010
Lisa Fiely703.373.8720
lisa.fiely@gt.com
Bill Webb703.623.1046
wwebb@e-s-g.com
Dick Willett202.778.3434
dwillett@tcba.com