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Agenda Item
ASR
Control 24-000600 |
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MEETING
DATE: |
07/23/24 |
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legal entity taking action: |
Board
of Supervisors |
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board of supervisors district(s): |
All
Districts |
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SUBMITTING Agency/Department: |
Auditor-Controller (Approved) |
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Department contact person(s): |
Andrew
Hamilton (714) 834-2457 |
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Laurence
McCabe (714) 796-0310 |
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Subject: Quality
Assurance Services for Enterprise Resource Planning Project
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ceo CONCUR |
County Counsel Review |
Clerk of the
Board |
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Concur |
Approved Agreement to Form |
Discussion |
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3 Votes Board Majority |
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Budgeted: Yes |
Current
Year Cost: $455,000 |
Annual
Cost: FY 2025-26 $907,500 |
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Staffing
Impact:
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No |
#
of Positions: |
Sole
Source: No |
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Current Fiscal Year Revenue: N/A
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Prior Board Action: 2/6/2024 #6 |
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RECOMMENDED
ACTION(S):
Authorize the
County Procurement Officer or Deputized designee to execute contract with
Government Finance Officers Association of the United States and Canada, for
Enterprise Resource Planning Quality Assurance Services, effective upon Board
of Supervisors’ approval through February 29, 2028, with an amount not to
exceed $1,602,500, and with the option to renew for two additional one-year
terms of $180,000 per year for a cumulative agreement amount not to exceed
$1,962,500.
SUMMARY:
Authorizing the
County Procurement Officer or Deputized designee to execute contract with
Government Finance Officers Association of the United States and Canada will
help to mitigate key risks in the County’s upcoming Software-as-a-Service
Enterprise Resource Planning modernization project by providing guidance and
independent project oversight from contract evaluation and negotiation through
project completion, ultimately to ensure the County implements a modern
Enterprise Resource Planning system that will meet its current and future
needs.
BACKGROUND
INFORMATION:
The County's
Enterprise Resource Planning (ERP) system, also known as the County-wide
Accounting and Personnel System (CAPS+), is a vital component of the County's
infrastructure. This critical system is
maintained and supported by the Auditor-Controller’s Office, Information
Technology division.
The ERP System is
required for the following County operations:
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Processing
the County's payroll |
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Making
vendor payments |
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Administering
Human Resources personnel records |
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Recording
financial business transactions |
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Preparing
financial plans |
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Budget
development |
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Maintaining
financial records |
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Generating
financial statements |
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Collecting
costs for federal and state program billings |
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Recording
procurement contracts |
The County has
utilized CGI Technologies and Solutions Inc.’s AMS Advantage software for the
core of its ERP System for over thirty years.
On February 6,
2024, the Board of Supervisors approved the release of a Request for Proposal
(RFP) for a Software-as-a-Service (SaaS) ERP System to replace the current
CAPS+ system. This previously approved
Board agenda item indicated the need for the Quality Assurance contract that is
the subject of this agenda item.
To ensure the
success of the SaaS ERP effort, the Auditor-Controller released an RFP on March
14, 2024, for Quality Assurance Services. These services are critical for
projects of this size and scope.
ERP Steering Committee
The
Auditor-Controller, in collaboration with the County Executive Officer, formed
a Steering Committee to guide the ERP modernization project that is broadly
representative of affected departments.
The Steering Committee will be responsible for the governance of the
project and incorporating input and support for this Countywide effort.
The members of the
ERP Steering Committee are:
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Andrew
Hamilton – Auditor-Controller |
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Salvador
Lopez – Chief Deputy Auditor-Controller |
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Michelle
Aguirre – Chief Financial Officer |
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Colette
Farnes – Chief Human Resources Officer |
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Brian
Wayt – Sheriff Executive Director, Administrative Services Command |
The ERP Steering
Committee supports the inclusion of independent Quality Assurance services.
Quality Assurance Services
The Quality Assurance contract will provide
independent quality control oversight from vendor selection through
implementation of the County’s new ERP system. To protect the County’s best
interests, Quality Assurance services include:
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Guide
the County through the finalist phase of the ERP RFP evaluation |
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Advise
on best practices in the creation of a contract with the selected ERP Vendor |
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Provide
quality assurance on ERP implementation activities |
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Track
ERP Vendor contract compliance to ensure the selected vendor meets its
obligations per the ERP contract |
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Provide
independent project quality control and quality assurance |
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Mitigate
ERP implementation project risks |
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Support
ongoing organizational change management efforts |
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Advise
on the development of new business processes, policies, and procedures |
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Provide
consultant services for the end-user and system administration training
programs |
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Provide
a production readiness review and report on the ERP Vendor’s system, its
operations, and the County’s business environment to ensure the system and
operational environment are collectively ready before all are moved into
production |
Quality Assurance Services on Prior ERP
Projects
The County
performed its last major upgrade of the Finance/Purchasing system from 2007 to
2009 when it transitioned from a mainframe to today’s open-system
platform. During this upgrade, the
County utilized the following similar Quality Assurance services:
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On
July 20, 2007, the Board of Supervisors approved a sole source contract with
Aeris Enterprises, Inc. for quality assurance, project risk assessment and
departmental implementation readiness scorecard management. |
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On
June 3, 2008, the Board of Supervisors approved a contract for Independent
Project Oversight Consulting and Independent Verification and Validation
(IV&V) Services with Alexan International. |
Internal Versus External Resources
The
Auditor-Controller considered internal County resources for the Quality
Assurance role on the ERP modernization project and determined that the County
should seek an external expert.
Considerations were:
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The
Quality Assurance role should be an independent third-party advisor, based on
best practices. This advisor must be able to review the selected ERP Vendor’s
work as well as the County’s to ensure a successful project. |
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The
Quality Assurance role should be filled by a service provider who has
extensive ERP implementation experience. There is no one within the County
that fits that role. While the County has performed upgrades to its ERP
systems, the County has not changed ERP vendors for 30 years. |
Therefore, the Auditor-Controller
determined that utilizing external Quality Assurance Services was in the
County’s best interest.
Solicitation Process
The
Auditor-Controller’s Office released Request for Proposal No. 003-2613901-LB
for ERP Quality Assurance Services on March 14, 2024, in support of the
County’s critical goal to modernize its ERP system.
Nine prospective vendors submitted
proposals in response to the County’s RFP, and these proposals were evaluated
by the evaluation panel. The five-person
evaluation panel included senior managers/executives from the
Auditor-Controller’s Office, the County Executive Office, and a local Orange
County city government.
After carefully evaluating the written
proposals, the panel selected two finalists to continue to the Finalist Phase:
Government Finance Officers Association of the United States and Canada (GFOA)
and Public Consulting Group. These two vendors participated in the final
in-person oral interview selection process.
The RFP evaluation
panel unanimously selected GFOA to provide the requested services. The
evaluation panel scores for this RFP are tabulated in Attachment C.
The panel conducted reference checks for
GFOA and found the responses to be satisfactory. The referenced agencies for GFOA were:
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Montgomery
County Public Schools, Maryland |
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County
of Thurston, Washington |
GFOA
GFOA is a
non-profit organization that strictly provides consulting services to the
governmental sector. Their stated focus is cultivating the success of local
governments. GFOA’s strength is its governmental member network and the ability
to connect the County to the leading best practices that have been learned,
recorded, and implemented throughout its years and decades of working with such
bodies. GFOA’s resources include its wide body of lessons learned, its “Best
Practice” tools, and its experienced consultants.
GFOA will partner
with Orange County throughout the life of the ERP modernization project as the
County’s independent quality assurance/control authority. They will ensure
project quality through the following steps:
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ERP
Vendor Selection Facilitation: |
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GFOA
will assist the County in the selection of the future ERP Vendor. They will
provide guidance in the proposal analysis process. |
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They will work
with the County team in developing scripts so that potential vendors can
provide demonstrations in an effective and efficient manner. |
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ERP
Modernization Contract Negotiations |
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GFOA will
participate in the contract negotiation process with the selected ERP Vendor.
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They
will take the lead in building the Statement of Work that will hold the
future ERP Vendor accountable to meeting ERP requirements and commitments to
the County. |
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They
will ensure the Statement of Work will contain milestone-based deliverables
that are defined to a sufficient level of detail to prevent any unnecessary
issues or misunderstandings during implementation. |
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The goal will be
the ultimate delivery of a quality system. |
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ERP
Modernization Implementation Quality Assurance |
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GFOA
will provide oversight of and guidance to the County’s SaaS ERP
implementation. |
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GFOA
will guide the County’s business process and policy review and re-design for
the changing environment. |
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GFOA
will ensure the County’s requirements are successfully met through tracking,
deliverable reviews, and through multiple levels of testing. |
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They
will ensure a smooth transition for the user community by working with the
County to strategize and execute an organizational change management program. |
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GFOA will
provide oversight and guidance to the project’s end-user training program. |
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GFOA
will ensure the County’s production readiness before the County moves onto
its new SaaS ERP system. GFOA will not wait until the ERP implementation
vendor states the system is ready. GFOA will utilize a methodology whereby
they build success factors into the project to ensure success at the time of
production cutover. |
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GFOA
will initially identify project goals, process improvements, and best
practices in order to build these success factors into the project’s effort.
They will review, identify, and ensure governance and project management best
practices are built into the project’s structure. They will document
requirements and business processes. |
GFOA will
accomplish these tasks while being held accountable by the ERP Steering
Committee. This contract does not currently include subcontractors or pass
through to other providers. See Attachment B for the Contract Summary Form.
This is a deliverables-based contract,
where the vendor will be paid as milestones are met. This contract was brought
to the Board of Supervisors within less than 30 days to allow for the
negotiation of the contract with the vendor.
FINANCIAL IMPACT:
The ERP project
and estimated cost were included in the
2023 Strategic Financial Plan and the cost of this contract is included in the
FY 2024-25 Budget for Fund 15I, Countywide IT Projects Non General Fund.
Auditor-Controller Budget Control 014, CAPS Program, will use the existing
appropriations to encumber the contract. If necessary, the Auditor-Controller
will submit any required adjustment for Board approval in the FY 2024-25
mid-year budget adjustment report to transfer funds from Fund 15I to Budget
Control 014 to cover current year costs.
Appropriations for this contract will also be included in the budgeting
process for future years.
The County has the
right to immediately terminate this Contract without penalty for cause or after
30 days’ written notice without cause, unless otherwise specified. Cause is defined as any material breach of
contract, or any misrepresentation or fraud on the part of the Contractor.
Funding for this project is 100% General
Fund. However, a significant portion of
funding for this project will be refunded in arrears through indirect cost
recoveries from Federal and State grants or reimbursements and County
non-general funds via the Countywide Cost Allocation Plan (CWCAP). An initial and preliminary analysis estimates
that at least 50% of expenses qualify as indirect costs, which may be refunded
to the General Fund.
STAFFING IMPACT:
N/A
ATTACHMENT(S):
Attachment A – Contract
MA-003-24011148
Attachment B – Contract Summary Form
Attachment C – Vendor Bid Tabulation