how to streamline an entire country?...gerall – lessons learned [2/2] •the importance of a...
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This presentation, including any supporting materials, is owned by Gartner, Inc. and/or its affiliates and is for the sole use of the intended Gartner audience or other authorized recipients. This presentation may contain information that is confidential, proprietary or otherwise legally protected, and it may not be further copied, distributed or publicly displayed without the express written permission of Gartner, Inc. or its affiliates. © 2010 Gartner, Inc. and/or its affiliates. All rights reserved.
José Cordeiro Gomes
How to streamline an entire country?
AGENDA:
PROBLEM CONTEXT AND SOLUTION DRIVERS
GERALL PROGRAM PRESENTATION
GERFIP EXAMPLE – BPM COMPONENTS
GERALL PROGRAM CONCLUSIONS AND
FURTHER STEPS
PROBLEM CONTEXT
AND
SOLUTION DRIVERS
GeRAP Mission and Milestones
• Startup date: May, 2007
• Mission statement: To implement Financial and
Human Resources Management shared services
solutions for the central Public Administration (PA)
- 450 Public Entities / 550.000 workers
• Calendar:
- Phase I: 3 years (2010)
- Phase II: 5 years (2012)
Vision and Scope
MF = Ministry of Finances; PA = Public Administration
Challenges
• Streamline and standardize processes and
interfaces
• Integrate data and solutions
• Rationalize costs
• Deliver reliable management information
• Build a customer driven SLA based relationship
• Overcome negative perception of former
experiences in providing Public Administration
common services and solutions
Requirements
• Build an integrated solution able to deploy quality financial and human resources management services in both modes
- Shared Services
- Shared Platform
• The solution must be
- Business user focused / Agile (ability to quickly adjust to business
requirements) / Efficient (continuous process improvement;
capability of implementing monitoring features) / Open and
interoperable / Vendor independent, based on components /
Cost effective (low TCO) / Consistent with private cloud
computing principles
Solution
• GeRALL Program:
- Financial Resources Management
- Human Resources Management
- Other solutions:
• Intelligent Business Process Management
• Interfaces and Integrators
• Master Data Management
• Analysis Services (Decision Support System)
• Customer Relationship Management
PRESENTATION
GeRALL PROGRAM
GeRALL Global Picture
GeRALL Technologies
BPM Components
GeRFIP EXAMPLE
GeRFiP Solution – “Visible” Components
ERP – Enterprise Resource Planning
• Accounting Rules
• Budgetary accounting
• Cost accounting
• Logistics and Inventory management
• Payments
• Management of materials
BPM – Business Process Management
• Users orchestration
• Business processes automation
• Processes planning, management and
optimization
Collaborative Portal
• Training
• Knowledge
management
• Business processes
execution
Business Intelligence Centre
• Tables, reports and queries
• Graphics
• Indicators
Relationship
• CRM
• Public Entities
relationship
management
GeRFiP – BPM Implementation Paradigm
Supports the execution of processes integrating complementary activities
Administrative Flow
Internal
Procedures
Accounting
Legal Requirements
GeRFiP – BPM Implementation Challenges
• Main Functional Challenges
- Orchestration of multiple systems, people and applications (one
field, one input, several systems)
- Users’ involvement in all the phases of the process (tasks or
notifications)
- Propagation of data through the process (to avoid input duplication)
- Dematerialization, transparency and monitoring of ongoing
processes
- Standardization of procedures and rules
- Normalization of procedures and functions regardless the specific
requirements of public entities
- Targets all types of Public Entities (S,M,L)
GeRFiP – BPM Expense Acquisition Cycle: Example
COMM
Budget Expense
Authorization Process
ID
Billing
Purchase
Order
Acquisition
Proposal
Create
Expense
Process
ID
Acquisition
Approval
Register
Pre-
Commitment
Launch
Acquisition
Procedure
Register
Adjudication
Expense
Authorisation Register
Commitment
Administrative activity Mgmt. activity Financial activity
B
P
M
B
A
C
K
-
O
F
F
I
C
E
Documents Back-office transactions
Legend:
GeRFiP – BPM Expense Acquisition Cycle: Results
• Effectiveness
- Alignment and
consolidation between
logistical and financial
flows:
• Compulsory
- Reduction of chargeback
process due to BPM:
• 52%
- Data Quality provided to
subsequent processes:
• Invoicing, payment, …
• Efficiency
- Cancellation of an operation:
• Became automatic, consistent and
integrated
(Concerned Objects: Expense Process ID,
Purchase Order, Pre-Commitment;
Expense Authorization; Commitment)
- Mean time between an ‘Acquisition
Proposal’ and the effective ‘Launch
of an Acquisition Procedure’:
• Reduced from 1 to 2 days to 10 to 35
minutes (variation is due to the waiting
time concerning the ‘Acquisition Approval”)
GeRFiP – Warehouse Goods Requisition Process: Savings example [1/3]
• Principles:
- Accountability: Costs must be imputed to a cost centre
- Transparency: All requisitions remain visible for the Entity
• Estimated savings for the whole central Public Administration : > 5.500.000 €
• Next improvement: Build a Decision Support System
Annual Actual Values Number of Public Entities: 65
Entities without
BPM (15)
Entities with BPM (50)
Savings due to
BPM (50)
Rate of consumption reduction 30% 51% 21%
Value of the reduced amount Out of this
Scope 1.569.000 € 646.059 €
GeRFiP – Warehouse Goods Requisition Process: Savings example [2/3]
Achieved reductions in Human Resources:
Currently Savings
% €
47,06% 320.000 €
0
50
100
150
200
250
300
350
# FTE without theProcess
# FTE with theProcess
Warehouse Goods Requisition Process
34 18
Current actual values
GeRFiP – Warehouse Goods Requisition Process: Savings example [3/3]
Estimated reductions in Human Resources considering
the whole central Public Administration:
Currently Savings
% €
47,06% 320.000 €
Estimated Savings
% €
41,09% 2.260.000 €
Total estimated savings due to this process: > 7.760.000
0
50
100
150
200
250
300
350
# FTE without theProcess
# FTE with theProcess
Warehouse Goods Requisition Process
34 18
275
162
Estimated values forcentral PublicAdministration
Current actual values
GeRFiP – BPM Suppliers Management process outcomes: Current values
Benefits Before
Process
100%
Manual
Process
85%
Automated
Savings
Time spent on the
business process No metric 6 minutes 2,6 minutes 57%
% of rectifications
required No metric 40,55% 20,30% 50%
Cost of each process No metric 3,10 € 1,40 € 55%
Total annual costs
estimation for the
central PA (€)
No metric 205.700 € 93.500 € 112.200 €
GeRFiP – BPM Suppliers Management process outcomes: Estimated values
Benefits Before
Process
100%
Manual
Process
100%
Automated
(estimation)
Savings
(estimation)
Time spent on the
business process No metric 6 minutes
< 1,8
minutes > 70%
% of rectifications
required No metric 40,55% < 15% > 63%
Cost of each process No metric 3,10 € < 1,00 € > 67%
Total annual costs
estimation for the
central PA (€)
No metric 205.700 € < 72.000 € > 133.700 €
CONCLUSIONS
AND FURTHER STEPS
GeRALL PROGRAM
GeRALL Challenges & Results [1/2]
• Challenges:
- Managerial
• Keep internal and external stakeholders focused
- Organizational
• Suitable management processes and tools are needed in order to properly handle the requirements and software development
• Improve the ability to build reusable components and processes as a key to keep a low TCO
- Technical
• Ensure all SOA constituent backend solutions adopt decoupled service oriented approach
GeRALL Challenges & Results [2/2]
• Results:
- More agile administration through streamlined processes
- Rationalized processes More efficiency, less costs
- Increase of business productivity, transparency and
accountability
- Better quality of management information
- Best practices replication
- Major saving results come from process rationalization and
automation which represent 70% of the overall cost
GeRALL – Lessons Learned [1/2]
• Apply a Unified Methodology
- Business Processes Engineering
- Business Processes Implementation
• Build a team with complementary competences
- Clear understanding of the defined architecture
- Abstraction capacity
- Business knowledge
- Selected tools capabilities
• Design to reuse Forms and Sub-processes
• Use best practices approach (documents, methodology, …)
Strategic Vision Detail Design Quality Control
Quality and Continuous Improvement
Implementation
GeRALL – Lessons Learned [2/2]
• The importance of a win-win partnership
- SAP
- Microsoft
- PNMsoft
• The importance to focus on the relationship with the main stakeholders
- Government
- Regulators
- Public Entities (customers)
GeRALL – Recommendations
• Elaborate an open approach to process design and
implementation, allowing for multi functional scope such
as Acquisition ,FM, HRM (including payroll)
• Internally control process design and development
structures, regardless external influence
• Strategically invest in technology that will create the
conditions for a modern and cost effective solution
• Focus on Governance
• Define and implement SLA from the beginning
GeRALL – Future Enhancements
• Automate tests and quality control
- Processes Quality and Continuous Improvement
- Technological Upgrades
• Automate detailed design process
- Design Forms and updating Field rules
- Automatic interaction between Forms and Business Rules
• Automate infrastructure mgmt. and deployment (Cloud)
• Develop benefits identification procedures
- KPI identification & Measurement procedure identification
• Business Activity Monitoring (BAM)
- Creating automatic monitoring procedures
Q & A
Questions?
This presentation, including any supporting materials, is owned by Gartner, Inc. and/or its affiliates and is for the sole use of the intended Gartner audience or other authorized recipients. This presentation may contain information that is confidential, proprietary or otherwise legally protected, and it may not be further copied, distributed or publicly displayed without the express written permission of Gartner, Inc. or its affiliates. © 2010 Gartner, Inc. and/or its affiliates. All rights reserved.