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HomeMy WebLinkAboutSLC Citizen's Budget Committee 4-17-15ST. LUCIE COUNTY CITIZENS' BUDGET COMMITTEE April 17, 2015 7:30 a.m. 0 :01- • • • • • -•• 1. Call to Order — Ron Knaggs, Chair 2. Public Comment 3. Approval of March 20, 2015 Minutes 4. Review of Major Budget Drivers o Staffing levels by Department o Budget Composition: • Salary and Wages - Impact of wage increases • Health Insurance Premiums and Other Benefits • Operating Expenses - Fixed costs and other major expense items 1. Informal BOCC Meeting Update 2. Other Issues 3. Adjournment Members: Jane Bachelor Ed Lounds Patrick Campion Jay McBee James Clasby Stephanie Morgan John Culverhouse Gwen Morris William Donovan Craig Mundt Carl Hensley Richard Pancoast Ron Knaggs, Chair Steve Weaver Daniel Kurek, Vice Chair -50 -2,1 m r (U t: U rl c cli < L E E —C: U) 49 LL- 2 CL In LO "2 U') u Lo Lr) Lo U) Ul) V) U') Lo Ln Lf) ;Lo if) !7 iz C14 I CY) I ce) to W C, LO L,) 17L LL r r 0 i a c 0 c 0 LL .0) EL IE i.c: LL ILL LL L.L .......... ---- - - . ............ ... ........... ....... 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County of St. Lucie ERP Needs Assessment Executive Summary Executive Summary April, 2014 The County of St. Lucie, FL implemented Banner approximately 20 years ago as the County's primary Enterprise Resource Planning (ERP) system that provides support for Financial Management and HR/Payroll business processes. The County recognizes that its existing ERP system is deficient in supporting certain business needs as many of the constitutional officers have slowly moved away from system. Currently, only the Board of County Commissioners (BOCC) and the Clerk of the Circuit Court operate on the Banner system as their primary software solution for supporting the various financial business processes of their departments. The remaining departments have been voicing their concerns with the lack,of functionality in the Banner system as well as the vendor's primary focus in being committed to the higher education sector. As a result, the County engaged Plante Moran to conduct a comprehensive assessment of current back office systems and business processes to determine the feasibility and practicality of replacing Banner with a new ERP solution. 1.1 PROJECT SCOPE The intent of this project was to perform an assessment of the BOCC and Clerk's current financial, utility billing, and personnel systems and business environment and identify key strategic options and recommendations. Discussions with the Sheriff, Property Appraiser, Supervisor of Elections, and Tax Collector were also in scope to identify needs for integration to a central County ERP system. In addition to looking at Banner's functionality, the project included an assessment of all shadow systems used by the BOCC and the Clerk to perform the financial, utility billing, and personnel processes. Specifically, the project scope for phase 1 of the project included the following major tasks to develop this ERP Needs Assessment report: • Conducting project management tasks • Reviewing documentation • Conducting interviews • Assessing the County's technical environment The following functional areas were included within the scope of the project: • Accounts Payable • Budgeting • Contract Management • General Ledger 2 1 P a g e • Human Resources • Payroll . Purchasing County of St. Lucie ERP Needs Assessment Executive Summary April, 2014 ...-. ....... ............. 1.2 PROJECT APPROACH The following chart illustrates the approach that was taken in performing the ERP Needs Assessment: 1. Initiation • Define Project Organizational Structure • Develop Project Charter • Develop Project Plan -Establish Project Collaboration Center 2. Needs Assessment • Review County Documentation -Conduct Interviews -Conduct Cross Functional Sessions -Assess Technology Environment 3. Draft Report -Compile Findings • Prepare Draft Report • Present Draft Findings 4. Finalize Report • Review Draft ERP Needs Assessment • Update Draft Report -Finalize Report The process for implementing new technology not only focuses on the technology itself, but also aims to enhance existing business processes performed by individual departments across the County. Technology is intended to enhance departmental business processes by: • Making them more efficient • Making them more effective • Improving decision -making • Providing enhanced customer service to both internal and external customers • Improving access to information • Streamlining processes to reduce costs. The overall goal of this needs assessment was to define a future course of action for the County's ERP environment to include software and supported business processes. The project was conducted using a participative and inclusive approach with significant input from County management and staff to ensure accuracy, completeness, and ownership of the resulting recommendations. Participation was obtained through the following activities: • Developing a Project Charter, working with the County staff to identify needs, making decisions about the project, and reviewing and providing feedback on project deliverables. • Facilitating project management status meetings to manage project activities and provide status updates. • Conducting interviews with the County departmental end users and process owners to evaluate current systems and business processes. Departmental management was encouraged to participate and invite team members. 3 1 P a g e County of St. Lucie ERP Needs Assessment Executive Summary April, 2014 • Conducting cross functional sessions where staff from all departments was invited to discuss issues, current processes and opportunities in the following areas: Projects & Grants, Budgeting and Contract Management. • Collection and review of numerous documents provided by the County as well as completed questionnaires by the departments. • Soliciting input from participating departments that included an evaluation of the following items: o Identification of current systems o Duplicate entry/re-keying of information o Issues with/shortcoming of current systems o Strengths of existing systems o Unused features/functionality of current systems o Opportunities to interface systems o Unique County business rules o Vendor interaction o Current technology project initiatives / future technology projects • Requesting and collecting data which was used to develop a return on investment analysis (ROI) relative to recommendations presented herein. • Development of the Needs Assessment Report, 1.3 SUMMARY OF OBSERVATIONS The approach Plante Moran followed in developing the Needs Assessment report focused on identifying how the current technology applications support the County's business goals and denoting opportunities for improving the effectiveness of business processes performed at the County in the future. While the County has a significant number of shadow systems to address the financial, procurement, and human resources functions across the organization (further detailed in the System Inventory section), the primary systems in use to centrally manage these functions are as follows: • Human Resources c • Service Orders U. Payroll • Meter Inventory Y Table: Current Primary County Applications 4Page County of St. Lucie ERP Needs Assessment Executive Summary April, 2014 1.3.1 Key Findings Below are the key findings and opportunities: Aging Financial System Recent advances in ERP systems, which the County's Banner system Lacks Functionality Found in does not fully utilize (either because they are not available or were Many Modern ERP Systems never implemented); include electronic workflow and self-service functionality. These functions significantly enhance efficiencies, as they enable end -users to complete and route transactions to the appropriate decision makers leveraging the use of notifications and queues which allows for greater organization and less redundancy. Limited Access to The County's past policy of denying access to core financial and human Information resources functions caused departments to create many Excel spreadsheets that duplicate all transactions that are entered into the Banner system in order to access necessary detailed information in real-time. This causes significant delays, manual processes, and reconciliations, to keep these shadow systems updated. Lack of Training Some departments do have access to their financial data but do not have the training on how to report or inquire on the information. Therefore, they rely on Excel spreadsheets and Access Databases to store duplicate information so that they can have real-time information accessible to them. Chart of Accounts (COA) The County currently manages grants and projects by assigning them a Design new fund. When a grant or project is completed all of these accounts must then be inactivated. This has made the COA very large and cumbersome to manage. A redesign of the COA is needed and a change in processes on how to manage this change is required to improve reporting capabilities. Manually Intensive Stand- Many of the shadow systems consist of individual Microsoft Excel alone "Shadow Systems" and spreadsheets, Access databases, and paper files that require Processes excessive time to use and maintain. Incorporating the information and calculations from these shadow systems into an integrated ERP system can reduce the effort required to maintain the information, make information more accessible to others, eliminate redundancy and manual reconciliation and reduce the risk of human error. 5Page County of St. Lucie ERP Needs Assessment Executive Summary April, 2014 1.12 Key Opportunities There were a number of consistent themes of unmet needs that were identified across each of the functional areas. The unmet needs, which County management and staff expressed as opportunities for improvement, are summarized as follows. 1. Full integration between all modules, allowing for the elimination of shadow systems. 2. Real-time, immediate update and access to additional financial and human resources information. 3. Single entry of data and reduction in manual processes and shadow systems. 4. A consolidated modern system with user-friendly features (e.g., easy navigation, drop down boxes, drill down functionality, validation of data upon entry, etc.) that offers on-line help functions and customized system documentation. 5. User -driven, user-friendly, and flexible reporting tools that support the information needs of staff and the County Commissioners including tracking and reporting of performance metrics. 6. Elimination of paper -based processes and replacement with automated, online workflows and approvals. 7. Streamlined business processes incorporating established best business practices. 8. Self-service capabilities and other "e-government' opportunities such as employee and vendor self-service and mobile workforce capability. 9. Improved reporting capabilities including dashboard capability. Overall, the majority of the unmet needs that are listed above could be met by a public sector based ERP system with a single, integrated database that allows integration with other existing applications. 6Page County of St. Lucie ERP Needs Assessment Executive Summary April, 2014 2 System Assessment 2.1 IDENTIFICATION OF KEY STRATEGIC OPTIONS Based on the analysis of information provided by the County, there are three primary options in regard to the strategic direction for a future enterprise resource planning (ERP) systems environment. The graphic below illustrates these options and the table that follows provides more specific information relative to each option. 1. Do Not Change Existing Environment Strategic ; Options Evaluated 2. Further �� 3. Replace Deploy & Current Integrate Systems w/ Current =;r Integrated Systems a� ERP Option 1:Do Not Change the Current Application Environment 7 1 P a g e With this option, the County would not elect to proceed with the acquisition and implementation of a new ERP system and would instead retain the existing Banner system, standalone systems, MS Office applications, and manual processes. It is possible that some of the manual re -keying of data between systems could be avoided by developing incremental new interfaces (as per Option 2); however, this option would not seek to promote additional integration for the County. In addition, training for all of the staff on the existing functions and features of the system could eliminate a small amount of work and frustration. County of St. Lucie ERP Needs Assessment Executive Summary April, 2014 Option 2: Further Deploy and Through a structured process, the County has the potential to better Integrate Current Systems access functionality within its existing Banner systems by purchasing additional software and implementing some existing software, re - engineering its account structure, as well as developing/revising custom technical integrations between the various systems to link, associate, or sending transaction data between the systems. In order to successfully realize the benefits of the future integrations, the County would need to simultaneously consider the impacts of each integration point and plan for optimization of each of the systems affected by the integration. This option would require a capital investment and necessitate additional ongoing investment compared to costs required to maintain the existing environment. Option 3: Replace Current The County can purchase an integrated financial management, Systems with an Integrated procurement and personnel software suite from an ERP software ERP provider which would be intended to replace the existing Banner applications as well numerous shadow systems and manual processes. An ERP solution would not replace all the County applications. A strategy would need to integrate or interface the purchased solution with some existing County applications using advanced tools. The system selection should be a competitive procurement with stakeholder input to define requirements and measure vendors against them. It would require a capital investment and necessitate ongoing sustained investment through software maintenance and continued internal technical support. 81P.age- County of St. Lucie ERP Needs Assessment Executive Summary April, 2014 The following is an analysis of the key strengths, weaknesses, opportunities, and threats based on the County of St. Lucie's current systems environment, ERP system selection project status, and implementation considerations/plans to date: 1. IT support and other County staff have 1. Limited tools to develop reports for access to critical created significant workarounds to information address user reporting needs 2. Lack of integration between Banner components 2. County commitment to engaging 3. Vendor has moved focus from Public Sector to Higher stakeholders in change process Education 3. County -wide desire to reduce paper- 4. Limited knowledge of the Banner system frustrates users and based processes whenever possible discourages use of current systems 4. New County staff have experience using 5. Significant shadow systems exist to assist with departmental newer ERP systems tracking of data in multiple functional areas 5. Growing interest in participating in 6. Several staff expressed frustration due to limited access to selection of new technology data. 6. Pent up demand: Users crave system 7. Banner inquiry feature limitations and limited reports make changes to improve their work processes access to information challenging 7. IT staff gearing up for implementation 8. Limited ongoing training available. As a result, new staff phase members may not be receiving enough training to fully utilize 1. Stronger standard system reports in a new system supplemented by a report writer 2. Transition to an information self-service environment 3. Growing belief that process re -design will be critical during implementation to take advantage of new systems 4. Leverage lessons learned from other County technology implementations 5. Grass roots project involvement strengthens likelihood of implementation success 6. Vendor solutions incorporate public sector best practices 7. Large County -wide project is conducive to phasing, prompting incremental change and spreading resource requirements 8. Improved integration with other County systems 9. Shared database for reporting 10. Automated electronic workflows 9 1 P a g e 1. Managing staff expectations that future system may not provide all requested features 2. Managing expectations that system functions will solve problems - will require process redesign, procedure & policy changes and changes to roles and responsibilities 3. Managing expectations re: balance of robust data tracking capabilities vs. simple interface 4. Strong institutional/current system knowledge concentrated in staff nearing retirement 5. General anxiety about change 6. Users entrenched in established systems and processes since Banner was implemented 7. Need for ongoing system support staffing 8. Inherent complexity with data conversion and integration 9. If single vendor solution is not selected, County's integration goals may be challenged 10. Managing change required when moving from paper -based processes to electronic processes County of St. Lucie ERP Needs Assessment Executive Summary April, 2014 t�Pl4 WA I The following represents the cost benefit analysis for five scenarios. The five scenarios are summarized below. If the County decides to go with Option 3 — New ERP, two choices for each option are provided. The two choices for each option show a traditional and cloud solution. A traditional solution would have the hardware onsite at the County (similar to the current Banner system) and the software license purchase as part of the one-time cost. A cloud solution would not include hardware (this would be housed and maintained by the vendor) or a software license purchase. Instead an annual fee (roughly three times the cost of traditional software maintenance) is charged for the use and maintenance of the software. Option 1 - Status Quo This represents costs for maintaining the status quo, including maintenance and support for Banner and the additional systems that could be replaced with a new ERP system. Option 2 - Invest in Banner This represents estimated costs for purchasing additional functionality for Banner, including the current (status -quo) costs plus an estimated $181,215 one-time cost for new functionality and $20,490 in additional annual, support costs. ACS quoted an annual cost increase of 10% which has been included in this estimate. Option 3 - New ERP • Low Estimate (Lower -end Tier 2). This represents a lower cost scenario based on Plante Moran's experience, along with more conservative estimates of cost savings (based on the low end of the expected cost savings range). This scenario would involve process redesign and implementation of a Tier 2 system with a lower degree of complexity, thus maintaining lower cost and implementation effort. The multiplier used is .75and_costs are based on market data obtained and analyzed by Plante Moran. • Medium (High Tier 2) Estimate. This represents the most realistic scenario based on Plante Moran's experience, along with an expected estimate of cost savings (based on the mid -point of the expected cost savings range). This scenario would involve process redesign and implementation of a Tier 2 system with a high degree of complexity, thus driving up cost and implementation effort. The multiplier used is 1 and costs are based on market data obtained and analyzed by Plante Moran. • High Estimate (Tier 1.5 Scenario). This represents a higher cost scenario based on Plante Moran's experience, along with more aggressive estimates of cost savings (based on the high end of the expected cost savings range). This scenario would involve process redesign implementation of a Tier 1.5 system with a higher degree of complexity, thus maintaining higher cost and implementation effort. The multiplier used is 1.25 and costs are based on market data obtained and analyzed by Plante Moran. 101Page N I-- O ci M W O � w �' a U z W W � W LU � � J U v a J � Q C/) co a Z W N 0 W co Liz County of St. Lucie ERP Needs Assessment Executive Summary April, 2014 4.1 RECOMMENDED STRATEGIC APPROACH While many incremental improvements could be made or added to the current fragmented applications which would mitigate the investment required by changing systems, the primary challenge with maintaining the status quo would be the inefficiencies, lack of recent advances in ERP systems (e.g., workflows), duplicate and triplicate entry with the excel spreadsheets and very little confidence in the current software by the majority of the users. When Ellucian took over the Banner product in 2012, the strategic focus is only on the education community. Staying with a vendor that is not focusing their software development on the municipal sector would not be recommended. Should the County conclude to remain with the twenty year old Banner software and current shadow systems, the complexities of the decision process could be delayed; however, it would be likely that the County would conclude to change its ERP system in the future at a time which is more reactionary than . strategic and planned. Remaining with the current environment does not appear feasibie.in the long term and inappropriate as a future strategic direction in context of the County's strategic goals and concerns of the current financial, procurement and personnel applications environment. While current inefficiencies were difficult for the County staff to quantify, there is a common belief amongst -staff that the Banner system and processes are inefficient and there is a universal acknowledgement that current information is not accessible or reportable, therefore, all departments have created several shadow systems for tracking budget, financial transactions and calculations. The same data is being entered into multiple spreadsheets as well.as in the Banner application. Given this inefficient environment and negative attitude toward the Banner system, the County may be best served to move toward procuring a new ERP via a competitive bid process. Should the County move with this recommendation, they should investigate both a vendor -hosted solution as well as an on premise (i.e., County -hosted) solution. 121Page wt 0 �_ �Q _ a �� a� �Q u n ct, a Ey� ® m m E C N r .EE T C O H N N m C O tm — t0iN. ie�•' iN L y F cc in Irn trn io lL '`. .H ,LL '- : O <'C , O U.'lL1^Z i O O O ILL ALL LL t , IL 1 i ! 7 tt `LL , ILL ,� ;� E� i I ;LL. , I 1 t .'_..,...._...... _.._L.....__..... �� �� iF IF _..I. ____ I t� Ems .-._ie�_...._j _... ..-yin._tl.....I .:.!_ .._.l.'...i�._;.ii�..__ vi- Ui U'i IN jM . �.:..1�... m n iP i� EF Ir f� Icy i ;- !8 `ems- i IN joc0 irn iIrns o o o to c tj !o to cc ® .' 1 I I i � c m o cb U) o a� j t 1 c 'c rn a U j i Ig aEi m m m m o c w10 10 i I N irn i - f i- i - a T 4) ! a m a I o i a f i= e t o p m iC I Vi C ,v� ju 10 N tCo j!; 1t j1 ,ip.c�. E w`o iE o f2C a) ioto o CD 1' a t`� ` Iwc ?� `o � ! n !Cl' `c �ac`Nmai I1. y O 0 Et v, cim iod '�•% C N(n IUCy 0`o C co_mE 0 1ii `s 'I erC 'd� E m m rn jd 0ao c(O CDIj m 0o 0 >NiO`n o o A + a d jo ycm a. i�� o :c , o c- t Ild7' y' a' f `o Lo s N w w i a) ���'� ( t o I� jdO (w oay 'as ` a o o :o !'.WCO I1s�op` a o ir - wCL W �u9 't o ioo� VN W ' po m NI5CDID Ci° ;a'oOq i'!1Nd:m Fm vooZ � _°o Laa a o°cis' a tf0 v� m� N M V to CO W at M N N aN- aM- N County of St. Lucie ERP Needs Assessment Executive Summary April, 2014 4.1 RECOMMENDED STRATEGIC APPROACH While many incremental improvements could be made or added to the current fragmented applications which would mitigate the investment required by changing systems, the primary challenge with maintaining the status quo would be the inefficiencies, lack of recent advances in ERP systems (e.g., workflows), duplicate and triplicate entry with the excel spreadsheets and very little confidence in the current software by the majority of the users. When Ellucian took over the Banner product in 2012, the strategic focus is only on the education community. Staying with a vendor that is not focusing their software development on the municipal sector would not be recommended. Should the County conclude to remain with the twenty year old Banner software and current shadow systems, the complexities of the decision process could be delayed; however, it would be likely that the County would conclude to change its ERP system in the future at a time which is more reactionary than strategic and planned. Remaining with the current environment does not appear feasible in the long term and inappropriate as a future strategic direction in context of the County's strategic goals and concerns of the current financial, procurement and personnel applications environment. While current inefficiencies were difficult for the County staff to quantify, there is a common belief amongst staff that the Banner system and processes are inefficient and there is a universal acknowledgement that current information is not accessible or reportable, therefore, all departments have created several shadow systems for tracking budget, financial transactions and calculations. The same data is being entered into multiple spreadsheets as well as in the Banner application. Given this inefficient environment and negative attitude toward the Banner system, the County may be best served to move toward procuring a new ERP via a competitive bid process. 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