City/County Joint ERP Implementation By Ajay Gajjar, CPA, CMA, CFM, CIA, CTP, CGFO November 16, 2012

What does ERP mean? A. Energetic Reporting Program B. Everlasting Relaxation and Peace C. Everyone Reacts in Panic D. Enterprise Resource Planning

Topics Scope of the project Benefits Issues related to: -- Procurement -- Management -- Accounting

Scope of the ERP Project Joint ERP procurement and implementation by: City of Tampa Hillsborough County: Board of County Commissioners Clerk of Circuit Court / Comptroller Civil Service Board

ERP System Goals Increase efficiency Improve managerial and operational effectiveness Promote intergovernmental cooperation and participation Reduce risk Maximize human capital

ERP System Objectives Reduce total costs of system ownership Streamline business processes through improved system integration Standardize business practices across organizations Promote accountability Improve ability to track and measure performance

ERP System Objectives f. Improve procurement management g. Eliminate redundant systems h. Protect sensitive data i. Improve ability to adapt to changing business and technical environment j. Reduce recovery time, if there is a disaster k. Better receivables management

ERP System Objectives l. Instill common skill set across local government m. Attract, develop and retain talent

Why are we doing this now? We currently use FAMIS, which is no longer supported. The number of separate computer systems will increase and become entrenched if we do not go to a single ERP system.

What did we buy? Licenses for Oracle E-Business Suite (EBS) version 12, Kronos, JobAps, and Vertex AST Corporation is the system integrator consultant for implementation Oracle on Demand will host the system for both the City and the County

ERP Contract Overview 5-Year Cost Summary ($000) Separate billing

Subledgers/Modules Purchased General Ledger Purchasing and Inventory Accounts Payable, iSupplier, and iExpense Accounts Receivable Cash Management and Treasury Management Fixed Assets Projects and Grants Business Intelligence (OBIEE)

Subledgers/Modules Purchased Continued: Human Resources and Self Service Budgeting (Hyperion) Payroll (Kronos) Others

Project Phases Wave 1 Financial, Procurement, Projects/Grants, Core HR, Business Intelligence, Reporting Wave 2 Code Enforcement (city of Tampa only) Wave 3 JobAps, Benefits

Project Phases Wave 4 Self-Service applications, Advanced Procurement Wave 5 Time Entry, Workforce Scheduling, and Payroll Wave 6 Planning and Budgeting

Project Governance Executive Sponsors (Elected Officials) Governance Committee Executive Steering Committee Project Managers (Consultant, City, County) Functional Leads Subject Matter Experts

Benefits of Joint Procurement and Implementation Same consulting firm handles both Save about $6.6 million

Benefits of Joint Implementation Both City and County personnel assigned – twice the involvement for a higher quality implementation County and City personnel learn from each other and open up lines of communication for future collaboration.

Benefits of Joint Implementation Possible savings on procurements by making purchases against City contracts, and vice versa. Employees would have more marketable skills and job opportunities across employers using the same system.

Project “Infrastructure” Joint office space set up for the project at the County County network IDs assigned for e-mail and scheduler access to all members of the ERP team including the AST consultants Dedicated conference rooms Dedicated training rooms

Project “Infrastructure” SharePoint set up for ERP for plans, documents, schedules, user guides Change managers at AST, County, and City Purchased Oracle books for office library

Procurement Issues

How do you set the requirements? -- hired a consultant to guide us through the process. -- If the requirements are too stringent, all responses will be “nonresponsive.” -- If the requirements are too vague, they will not be useful.

When will the core financial system go live? Our choice: April 1, which was pushed to May 1 due to a delay in negotiating the contract. Benefits: It gives us several months before the busy fiscal year-end period to work out any problems. It avoids the busy year-end period of time.

Management Issues

Modifications When Oracle upgrades are done, all modifications will need to be re-established (at a high cost in consultant or staff time). We are trying to minimize the number of customizations. Modifications are paid for jointly or separately depending on who benefits.

Historic Data Data conversion is difficult and expensive. How much historical data should be converted? Our decision: 2 years of historic data and the current year in detail. Trying to convert data on active grants and projects (which are set up as inception-to- date).

New Business Processes? 3-way match vs. Instant 3-way match Expense reports vs. iExpense Journal Entries after the fact vs. time reporting Cash controls vs. allocating budget by

Getting Information From Old System Reports from old system will be available on Spoolview (report viewing software). Old system with data through April 30, 2013, will be available for viewing only until the new budget system is implemented (Wave 6).

Transaction Detail System Support Department will download transaction detail, year by year, just in case the details are needed for audits by: - Federal Emergency Management Agency - Arbitrage audits by the Internal Revenue Service, - Grant audits by state or federal grantors.

Superusers & Training What “superusers” do and why is it important to identify them early in the process? How will training be handled during and after implementation of all ERP waves?

Getting Staff Involvement Joint City/County meetings on requirements Joint City/County demonstrations by potential vendors Meetings early in the process to discuss “pain points” associated with the old systems

Why do we need Change Management? We overestimate the disadvantages of change and underestimate the advantages of change. Adapting to change is difficult. Some people fear losing their jobs to “automation.” Some sharing between City/County/AST Change managers

Accounting Issues

General Ledger Objectives Meets statutory reporting needs Meets management reporting needs As simple as possible Room for growth and additional entities BOCC and Clerk share General Ledger For example, natural accounts are shared

Accounting Segments – General Ledger Fund Cost Center (Department) Natural Account (General Ledger Account) Sub Account (Function) Activity (for management tracking* Project (to assist reconciliation with subledger) Future

Accounting Segments – Projects and Grants Subledger P - Project number for grants and capital projects O - Organization (i.e. department) E - Expenditure natural account T - Task, a subdivision of a project A - Award, the funding source for a grant or capital project

Capitalization of ERP Costs Capitalize internally generated software such as actual programming work. We capitalize the ERP Director’s time, the salary cost of the consultant hired as the County’s project manager, and the cost of AST system integrator.

Shared Vendor File The same vendor file will be used for the City and County. But the vendor may be 1099 reportable at one entity and not the other. Solution: Use a code to distinguish City and County vendors, but use the same file. And possibly vendor maintenance by one area for both entities.

How do you know if the conversion was successful? Oracle Insight – an Oracle program to compare metrics before and after to see measure the change brought about by the ERP system.

Other Governments With ERP Systems City of St. Petersburg, FL (Oracle) Polk County, FL (Oracle) Pinellas County, FL (Oracle) Loudoun County/Loudoun County School Board (Oracle)

Hillsborough County Contacts Ajay Gajjar Assistant Finance Director Hillsborough County Clerk of Circuit Court (813)307-7026 gajjar@hillsclerk.com Eric Johnson Strategic Planning & ERP Implementation Hillsborough County BOCC (813)272-6582 JohnsonE@HillsboroughCounty.org

City of Tampa Contact J. Michael Fitzgerald, Jr. Accounting Manager City of Tampa Accounting Office (813)274-7101 michael.fitzgerald@tampagov.net