High Performance Government in Action The Ohio Shared Services Story J. Pari Sabety Ronn Kolbash July 15, 2010

Looking Back: A Brief History of Ohio Shared Services Jul 07 Nov 07 Jan 08 Feb 08 Apr 08 May 08 OAKS Financials Go-Live Assessment Results Shared Services Project Start-up Governors Executive Order S RFP Award Implementation & Quality Assurance Business Case Published Aug 09 Go Live 1

Facing the Facts Its the best of times to launch shared services for enterprises… –12% reduction in revenue as a result of recession –Reduction of 5000 positions in state government, or 8% –Ready to retire: 14% of workforce in 2011; 33% of workforce in 2014 But its the worst of times for agencies… –Repeated operating budget reductions –Loss of key fiscal staff –Climate of fear 2 The Play: Use capital dollars to reduce and redeploy operating resources

Business Case 3 ProcessingLowProcessingMediumProcessingHigh ROI6.6 yearsROI4.5 yearsROI3.8 years IRR22%IRR44%IRR65% Functions & Speed NPV (20Years) Functions & Speed NPV (20Years) Functions & Speed NPV (20Years) AP, T&E Only 33 Months $180 Million AP, T&E, Payroll, Time Reporting 30 Months $541 Million All Targeted HR/ FIN Functions 27 months $1.17 Billion Key Assumptions Scope: AP, T&E, Payroll, Time Reporting, ISTV, COA Maintenance, and Vendor Master 25,382 AP vouchers / FTE / yr. (13 / hr.) 14,946 Travel vouchers / FTE / yr. (8 / hr.) 20,401 Change Requests / FTE / yr. (11 / hr.) 15 to 1 Span of Control Current Agency FTE: 660 Shared Services FTE: 255 Key Assumptions Scope: AP, T&E, ISTV, COA Maintenance, and Vendor Master 9,077 AP vouchers / FTE / yr. (5 / hr.) 10,892 Travel vouchers / FTE / yr. (6 / hr.) 13,486 Change Requests / FTE / yr. (7 / hr.) 10 to 1 Span of Control Current Agency FTE: 378 Shared Services FTE: 219 Key Assumptions Scope: AP, T&E, Payroll, Time Reporting, ISTV, COA Maintenance, Vendor Master, Staffing, Total Rewards Admin, Data Mgmt, Workforce Dev, Accounting/External Reporting, Compliance Mgmt, and Revenue Cycle 41,688 AP vouchers / FTE / yr. (22 / hr.) 17,246 Travel vouchers / FTE / yr. (9 / hr.) 28,562 Change Requests / FTE / yr. (15 / hr.) 20 to 1 Span of Control Current Agency FTE: 1,699 Shared Services FTE: 862 Aggressive ScenarioModerate ScenarioConservative Scenario

Governance Structure Agency Partnership Governance Union Governance Responsibilities Focus on: 1.Performance Management & Compensation 2.Training and Development 3.Continuous Improvement Responsibilities Focus on: 1.Working with OSS management 2.Resolving escalated issues Responsibilities Focus on: 1.Resources 2.Buy-in 3.Strategic direction Responsibilities Focus on: 1.How well? 2.Whats next? Responsibilities Focus on: 1.Continuous improvement 2.Operational performance Governance Council CFO Council Process Council Partnership Committee Working Groups Working Groups Working Groups Strategic Operational Meet Biannually Meet Monthly Communicate Often Meet Quarterly Meet Monthly Talk Daily Leadership Management Operations Outside Advisory Council 4

What is Ohio Shared Services 5 What is Ohio Shared Services? Ohio Shared Services is the first shared services environment in Ohio government that delivers common transaction processing for state agencies and business vendors with an emphasis on customer service. At Ohio Shared Services, we deliver Service First by engaging our employees and partnering with our customers. Mission Execution, Efficiency, Customer Service Ohio Shared Services executes administrative transactions for its customers while skillfully balancing efficiency and customer service to add value through lower cost and improved effectiveness. Our primary key to success is a highly motivated, top-performing, self-directed workforce. Vision Best In Class, High Performing Public Service Entity Ohio Shared Services is nationally recognized as a public sector pioneer that manages multiple business processes for a variety of public sector entities. It is recognized as best in class in serving its customers, in maintaining a high- performance workplace and in recognizing employees as its most critical asset.

Ohio Shared Services Video - Opening 6

Ohio Shared Services Video - Facility 7

Ohio Shared Services Video – Contact Center 8

Ohio Shared Services Video – Travel and Expense 9

Ohio Shared Services Video – Service Management 10

Ohio Shared Services Video – Technology 11

Self-Directed Work Teams Defined A group of employees who have day-to-day responsibility for managing themselves and the work they do with minimum [of] direct supervision. Members of self-directed teams typically handle job assignments, plan and schedule work, make production – and/or service-related decisions, and take action on problems. - the Association for Quality and Participation 12

SDWTs vs. Traditional Teams Self-Directed Work Teams Traditional Teams Customer-driven Management-driven Multi-skilled work force Work-force of isolated specialist Information shared widely Information limited Few levels of management Many levels of management Shared goals Segregated goals Results achievement emphasis Problem solving emphasis Continuous improvements Incremental improvements Self-controlled Management controlled Values/principles based Primarily policy/procedure 13

L2 L3 L4 L5 L6 L2 L4 L3 Span-of-Control Approach Illustrative Current State Org Chart Illustrative Future State Org Chart 14 Collect Org Charts & Interview Team Calculate Current Spans of Control Identify Opportunity areas relative to SOC Benchmarks Identify Organizational Constraints Develop Future State Org Charts by Function

What do SDWTs Do? 1.Develop goals and plans 2.Enhance communication among members 3.Solve problems and make decisions 4.Provide development opportunities for team members 5.Clarify roles for team members These are the main characteristics of self-directed work teams. 15

Associate Selection Process Selection: The OSS Associate selection process involves four steps. 1.Screen Application: Candidates meet minimum qualifications to continue to proficiency testing. 2.Test Proficiency: Candidates pass proficiency test to continue to interviews. 3.Interview: Candidates complete mock call and critical behavior interviews before being considered for offer. 4.Offer: Candidates are ranked and the number of offers are determined based on hiring need. Screen Applications Test Proficiency InterviewOffer 16

Self-Directed Work Teams are Supported by Seven Pillars Customer Inquiries Travel & ExpenseVoucher Processing Vendor Maintenance Performance Management Decision Rights Coaches Technology Workflow Continuous Improvement OCSEA Partnership Governance Compensation 17

Reporting Overview By directly measuring strategic objectives outlined in the Ohio Shared Services Mission, the Balanced Scorecard will be a key tool to communicate the quantitative successes or challenges of Shared Services to a wide audience. To measure efficiency and effectiveness of service delivery to our key agency partners, Service Charter Scorecards will track commitments made in these Service Charters by both Ohio Shared Services and agencies. Daily Scorecards for each function at Ohio Shared Services will serve as the foundation for the performance-based culture at Ohio Shared Services. These scorecards will measure Key Performance Indicators (KPIs) in the Service Charter as well as other key operational metrics, and ensure that each days performance is appreciated. A unique set of Operational Reports for each function will be identified as needed to drive key actions or measure detailed metrics on a daily, weekly, and monthly basis. Certain KPIs will be selected for each function to be measured by associate and included in each Individual used in the quarterly Ohio Shared Services Performance Management process. Ohio Shared Services Balanced Scorecard Ohio Shared Services- Agency Service Charter Scorecards Functional Daily Scorecards Operational Reporting Individual Scorecards Establishing Data Control 18

Contact Information For more information please visit: Contact : Pari Sabety, OBM Director Tel: Contact: Ronn Kolbash, OSS Leader Tel: Ohio Shared Services 4310 E. Fifth Avenue Columbus, Ohio

APPENDIX 20

What We Do Here The processes currently performed at Ohio Shared Services : Accounts Payable –Invoice Processing –Document Retention Maintain Vendor Information –1099 Forms –Vendor Inquiries –Vendor Maintenance –eSupplier (vendor self-service) Travel and Expense Reimbursement Chart of Account Maintenance Statewide Finance and Learning Management End User Support 21

How We Do It Core Competencies Together we will: Deliver world-class customer service Strive for excellence in finance processes Empower employees to exceed customer expectations Monitor performance both internally and externally and act on the results Champion change and innovation in government Shared Values Every individual must: Show Resilience Demonstrate Integrity Commit to Excellence Provide Stewardship Expect Continuous Improvement Foster Partnerships Never Stop Learning Service First Continuous Improvement Teamwork 22

Individuals are accountable for their own performance The individual… Understands or seeks clarity on what is expected of him or her Seeks timely performance information and feedback Assesses and improves his or her performance Individuals are accountable for helping others improve their performance The individual… Helps others understand expectations Provides data and/or observation-based feedback, as appropriate, to other Ohio Shared Services employees regardless of level Willingly shares, teaches, and coaches others to improve their performance Leadership supports a culture of continuous learning and development Every leader… Fosters a safe environment for employees to ask for help Assures clarity of expectations and alignment between individual and center performance Strives for each Ohio Shared Services employee to be successful by providing learning and development opportunities Reinforces the importance of the performance management process and commits to executing it well Assures the performance management process supports high performers with development opportunities Scorecard for Success 23

Facility Supports Culture 24 Mail/Scanning Room Transaction Processing Requirements and Configuration Management Call Center Team Huddle/Conference/Training Rooms Server Room Break Room High-performing facilities account for functional requirements of everyday tasks, support flat hierarchical and centralized organizational structures, and promote employee well-being, satisfaction and productivity. Front Entrance and Reception You are here

Organizational Structure Ohio Shared Services is comprised of two segments: contact center and transaction processing with a dedicated team of: Center Leads –Contact Center –Finance Coaches Ohio Shared Services Associates 25

Associate Scorecard – Actual Data 12/1/09 - 2/23/10AP VolumeAP Quality NameTotal Average per Day Average per Month Exceptions Completed (included in Totals)PassedFailedTotal% Passed Associate % Associate % Associate % Associate % Associate % Associate % Associate % Associate % Associate % Associate % Associate % Associate % Associate % Associate % Associate % Average % 26