The OSS Opportunity in Public Sector Finance Transformation
“How narrow is the line which separates an adventure from an ordeal”Sir Harold Nicholson
Open Source Awareness Event 2 - Home Office building, 2 Marsham Street
20 March 2012 ( version 0.1.2)
Introduction
Today's Questions......
What is Finance Transformation and what does it have to do with an Open Source awareness event?
What benefits does OSS provide to Finance Transformation in the Public Sector?
What processes could be addressed in Finance Transformation?
What does an OSS Finance Transformation look like?
How to become OSS friendly and support innovation....
Williams Lea Internal
Principles of Finance Transformation…..
B C D
We use these concepts to design the Finance Target Operating Model (TOM)
A
Delivering Finance Transformation
Process Alignment
- Procure to Pay
- Tax to Collect
- Order to Cash
- Record to Report
- Hire to Retire
Data Standardisation
Build Capability
Aims to reduce the cost of finance to around 0.45%-0.60% of total spend
Achieve a balance between operational efficiency, control and business intelligence
Facilitate the industrialisation of processes and reduce non value added back office costs delivering value to the citizen
Consolidate Eco-systems - Transactional Systems Financial: ERP, Banking, Scanning, Indexing, ePayments, eInvoicing Operational: Procurement, Tax Calculation- Business Intelligence ETL, OLAP, Canned Reporting, Dashboards, DSS
Measures of Finance Transformation
Summary Metrics
Cost of Finance
Transaction Processing FTE
Purchasing Metrics
Cost per Invoice Processed
PO Compliance %
E-Invoicing %
PO Match Failure
Collections
Overdue Days
Enforcement %
Opportunities: OSS Finance Transformation & the Public Sector
Transactional Systems
Higher levels of integration to operational systems
Reduced customisation across multiple platforms
Data Standardisation
Common and aligned data sets to analyse information across the public sector (and information requests)
Standardisation of Finance interfaces
Supports Open Data Initiative
Processes Alignment
Common processes for common activities – design, documentation, system enhancements
Economies of scale and increased automation lead to reduction in FTE's
Cost of Ownership
Opportunity to outsource back office
Reduction in licensing and maintenance costs
Knowledge
Transferable skill sets between departments
Standardised interfaces
Business Intelligence
Opportunity to deliver BI across a simplified landscape
Publish BI to citizens via Open Data
OSS addresses many of the challenges of the ICT Strategy
OSS facilitates the re-use of applications and off the shelf software
OSS facilitates interoperable systems and open standards
OSS facilitates a more level playing field for integrators based on capability rather than product ownership/control
OSS reduces risk as investment in projects is lower at every point in the project
http://www.cabinetoffice.gov.uk/content/government-ict-strategy March 2011
Comparison of ERP Implementation & Support Costs
Cost Proprietary + Multinational Integrator
Open Source + Local Integrator
Software Licenses & Maintenance
USA / Germany None
Hardware Same Same
Customisation Tax Haven / Offshore Onshore
Planning
Process Reengineering
Integration
Data Migration
Testing
Training
Project Management & Control
What would the citizen prefer?
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An simplistic example of an OSS landscape
Scanning & Indexing
ERP
ERPOperationalSystems
BusinessIntelligence
Extract Transform Load
Example OSS Products:
EphesoftADempierePentaho Kettle/TalendSpagoBI/Pentaho/Jasper/Mondrian
Shared Services
OSS Finance Transformation: Key Benefits for the Public Sector
Improved management information to analyse and benchmark products and services you buy
Build & retain knowledge locally to support local innovation
Choice about in which country profits & wages will be earned
Create jobs in regional areas by deploying support teams
Integrated and customised eco-system
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Some Thoughts for Further Investigations
Add OSS applications to the Public Sector Application Store
Engage OSS professionals to advise / assist with steering
Utilise OSS ERP Professionals to assist with Process Documentation & Re-engineering in preference to a multi national consultancy
Symbiotic partnership between government, innovation and OSS
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Questions
Contact Details
Email: [email protected]
Phone: 07900 435 887
Operational Design Framework
Source: Delloite Paper on Public Sector Finance Transformation 2011
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Finance Transformation Focal Areas
Up skill people in technical & transformation support skills
Instil process orientation
Focus on interpretation rather than preparation
Significant engagement
Transformation Management
Co-ordinate & communicate transformation activities
Plan & engage resource
Create & disseminate structured learning
People
Document & publish processes
Process re-engineering
Common language for process & change
Quality assurance mechanism
Establish processes for maintaining & controlling master data
Benchmark of change
Procedures
Common data definitions & defined governance
Documented data, relationships & controls
Documented, validated and controlled transformations
Managed, reconciled data and data migration
Open & controlled data
Data as a service
Data
Eco-system roadmap
Strategic & tactical view
Reduce number of systems and interfaces
Co-ordinate strategic system change
Certified/assured systems
Global Platforms
Web / SSO
Systems
Co-ordinated & Structured Approach
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ERP Implementation Process Overview
Communication
Project Management
