P U B L I C S E R V I C E S State of South Carolina Enterprise Information System Business Case Study SCEIS User Group Briefing Wednesday July 10, 2002

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 1 Agenda Business Case Study  Study Objectives  Scope of Study  Project Approach  Project Team  Milestones  Key Deliverables  Samples  Next Steps NOTES:

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 2 Study Objectives Six Key Study Objectives  Inventory key financial, operational and technical information from each of the State’s agencies  Estimate the State’s current cost of ownership for fragmented agency systems, technologies and processes based on information gathered from agencies  Determine the costs and benefits associated with implementing a common SAP business infrastructure statewide  Analyze the potential return on investment (ROI) associated with a statewide SAP implementation  Define a Statewide SAP implementation plan and rollout strategy including project team roles and support strategy  Define alternative financing and allocation of the implementation costs options NOTES:

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 3 Scope of Study  Survey all agencies that utilize CG central systems  Includes approximately 75 agencies (excludes Lumpsum Agencies)  Separate interviews with key central agencies  Comptroller General  State Treasurer  BCB - Office of Human Resources  BCB - Office of State Budget  BCB - Office of State Auditor  Selected large agencies  ROI calculations based on SAP ROI model  Survey results will be collected via web portal  Study results will be based on survey answers

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 4 Project Approach KPMG has developed a 5-step work plan to achieve the objectives of this study: Step 1Design Business Case Portal Step 2Develop Business Case Portal Step 3Collect Data Step 4Evaluate and Analyze Results Step 5Present Findings NOTES:

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 5 Project Approach Step 1Design Business Case Portal Key Activities Design business systems inventory survey instrument Develop cost calculation methodology Design business case portal NOTES:

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 6 Project Approach Step 2Develop Business CasePortal Key Activities Secure development environment Complete business case portal technical design Develop business case portal communications plan and rollout strategy Develop and test business case portal NOTES:

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 7 Project Approach Step 3Administer Survey Key Activities Implement communications plan Support portal during agency input Conduct Central Function / Agency Interviews  Comptroller General  State Treasurer  BCB - Office of Human Resources  BCB - Office of State Budget  BCB - Office of State Auditor  Selected large agencies Audit results NOTES:

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 8 Project Approach Step 4Evaluate and Analyze Results Key Activities Analyze survey results ― Analyze agency demographics ― Analyze agency cost metrics ― Analyze current risks ― Analyze benefit opportunities, categorized by:  Direct cash savings  Process savings  Other potential savings  Prepare Business Case Study Document NOTES:

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 9 Project Approach Step 5Present Findings Key Activities Prepare and conduct executive overview presentation Finalize business case portal content NOTES:

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 10 Project Team KPMG Consulting Project Team We’ve put together a project team with substantial knowledge and experience of the state government technical, process and organizational issues central to this study. The core team includes the following individuals: Tim Perkins Bryan Groden Richard Fox Joe Gubbins KPMG Consulting will draw upon other personnel resources as needed. NOTES:

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 11 Project Milestones Key Project Milestones are presented in the table below: NOTES: Key Project MilestonesDate Finalize/Approve Survey PrototypeAugust 2, 2002 Finalize/Approve Portal DesignAugust 9, 2002 Finalize/Approve Communications Plan July 19, 2002 Conduct Portal System TestAugust 19, 2002 Complete User Acceptance TestAugust 23, 2002 Portal Available – Agencies Begin Entering Survey Data August 26, 2002 Agency Survey Period EndsOctober 11, 2002 Executive Overview PresentationNovember 14, 2002 Finalize Portal Content/End of Project November 15, 2002

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 12 Key Deliverables Key Project Deliverables are presented in the table below: NOTES: Survey Web Site  Survey Design  Cost Calculation Methodology  Web Page/Database Design  Web Site Development Business Case Study  Executive Summary  Agency Demographics and Systems Inventory  Current Cost of Ownership (existing business systems)  ROI Analysis  Statewide Implementation Plan and Approach  Statewide Support Structure Recommendations  Total Estimated Costs and Financing Model Executive Overview Presentations  Business Case Summary  Statewide Plan and Approach

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 13 Process areas to be covered in survey  Preparing the CAFR  Monthly financial closing  Accounts payable  Federal funds processing  Purchasing  Inventory  Payroll  Human Resource management  Employee self service  Budget preparation and reporting  Cost of ownership for multiple systems including support staff

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 14 Samples Sample Survey Question NOTES: Sample cost savings calculation Estimate the effort, in staff person-days, that your agency spends preparing, reviewing, correcting and submitting completed closing packages and other related year-end information required by the Comptroller General to prepare South Carolina's annual CAFR. Amount of reduction in effort required for preparation of monthly and year-end (CAFR) Financial Statements multiplied by average labor cost.

State of South Carolina – Business Case Study P U B L I C S E R V I C E S Page 15 Next Steps  Agency User Group Kick off meeting – July 10, 2002  Oversight Committee Briefing – July 11, 2002  Define specific requirements for housing portal and establish development environment (portal will reside on CG NT server)  Schedule Agency User Group Workshop to Review/Refine Survey Questions and identify Pilot agencies ― Identify Participants and Meeting Location ― Schedule Date/Time  Finalize listing of participating Agencies  Obtain Contact Information for participating Agencies (name, agency, title, phone, )  Identify contacts for Central Function / Agency and schedule interviews