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IFMS Overview and Progress Report

Portfolio Committee on Public Service and Administration

4 March 2015

• What is IFMS?

• Why IFMS?

• Historic Overview

• Project Stakeholders and Roles

• Project Reviews and the change in the Solution Architecture

• Current Status

• Forward-looking Perspective

Overview

What is IFMS?

• The Integrated Financial Management System (IFMS) programme is a joint initiative between National Treasury, DPSA and SITA to modernize and integrate the Public Service’s transversal information technology (IT) systems for the following domains:

– Human resource management– Financial management (including payroll)– Supply chain management (including asset, inventory and procurement

management)– Business intelligence

• The current transversal systems in the Public Service (PERSAL, BAS, LOGIS, Vulindlela, etc) will be decommissioned as the IFMS is implemented.

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Why IFMS?

Practical• To replace ageing technology.

• To avoid increasing costs of maintaining obsolete systems.

Organisational

• To facilitate ongoing financial, supply chain and human resource management

improvements and reforms.

• To process and compile data in ways that improve availability of quality

information for planning, reporting and better decision making.

• To offer the potential to take advantage of new features that today’s technology

presents such as self service.

• To take advantage of global lessons learned in the management of public

resources.

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WHAT ARE THE POSSIBILITIES?Using Technology for Strategic Ends

• To allow officials to transact remotely – applying for leave directly via a web interface,

obtaining reports from mobile devices, etc.

• To contribute to more informed decision-making by presenting data from several

perspectives.

• Render business processes more efficient - for example, validation of information

held centrally could be done electronically. Examples range from referencing of tax

clearance certificates, confirming identity numbers with Home Affairs and determining

the extent to which specific vendors engage with government.

• Automation and standardization of business processes will increase business

efficiency, reduce cost and improve data quality.

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Timeline of Events

2002Budget Council approval to develop strategy to renew financial systems

2004Phase out of FMS; URS and MSP developed

2007Cabinet informed of challenges and amended plans; acquisition/ development of modules commenced

2005Cabinet approved IFMS with hybrid solution architecture (combination of COTS and bespoke modules); Moratorium on acquisition of IFMS type systems

2006Rescheduling of project plan due to institutional and project challenges experienced

Phase IRequirements Specification

Phase IIInstitutional capacity

building

ORIGINAL PROJECT SCHEDULE

ACTUAL SEQUENCE OF EVENTS

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Timeline of Events (Cont.)

2010Completion of Asset Management & Human Resource Management modules

2011Completion of Procurement & Catalogue Management modules

2012Development of Inventory module and Business Intelligence phase I (Vulindlela replacement) began

2013

Development of Financial Management module beganExternal reviews on IFMS commissioned

On Integration:• Partial integration with legacy systems: HRM with PERSAL and

Procurement Management with BAS • Limited integration between IFMS modules

Phase IIIProcurement and implementation

ORIGINAL PROJECT SCHEDULE

ACTUAL SEQUENCE OF EVENTS

Full scale rollout

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2014Established PMORFP 1182 (COTS ERP software and lead site implementation services) published 20 March 2014. Objections received, RFP allowed to lapse.RFP 1282 (software) published 28 Nov 2014

1 April 2017 Lead sites go live and commence national rollout

2015

RFP 1282 closed on 30 January 2015, bids evaluated, currently in process of obtaining approval to appoint successful bidder.Next steps: Conclude software agreement, procure implementation services and hosting infrastructure, blueprinting, development of solution, commence lead-site implementations. Develop National rollout plan

2016

Conduct testing, compare parallel-system results, conclude analyses and undertake refinements where necessary

Turnaround for revised implementation

approach

Preparation, systems transition management and

institutional capacity building

ENVISAGED TIMEFRAMES

Timeline of Events (Cont.)

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Key Project Stakeholders and Roles

National Treasury•Project Sponsor•Policy Ownership

– Financial Management including Payroll

– Supply Chain Management– Accounting Standards

•Manage Corporate Reference Data for SCM, FIN

•Manage legacy systems

DPSA•Policy Ownership

– Human Resource Management

•Manage Corporate Reference Data for Human Resource Management

SITA•As future PSI 1, develop overall

integrated solution architecture•Acquire and integrate the

components and services into an overall solution

•Provide technical support over the solution lifecycle

•Hosting Services

Ministerial Oversight Forum

IFMS Steering Committee (Steer Com)

IFMS SLA Committee (SLA Com)

IFMS PMO

IFMS Product Boards

IFMS Implementation Committees

Hiding DPSA logoNotes:1 - SITA’s role as Prime Systems Integrator to develop integrated solution architecture will substantially change due to the COTS architecture requiring far less integration effort within the IFMS.

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Project Reviews

• Three independent reviews on IFMS commissioned in 2013 – done by Ernest & Young, the World Bank and Gartner.

• One of the elements that was considered during the reviews was the IFMS solution architecture. All the reviews essentially came to the same conclusion, namely that the hybrid solution architecture should be replaced by a solution architecture that consists exclusively of COTS modules.

• Reasons for this conclusion:· On-going maintenance costs of the hybrid system would be prohibitive compared to those of a COTS-

based solution. · The development and maintenance of bespoke modules for the IFMS require large numbers of highly

skilled technical professionals, who would have to be retained throughout the project life-cycle. · In the case of a COTS solution, module integration and on-going updates are less complex, and unit

costs and skills requirements are less onerous.

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• Benefits of changing the solution architecture: · Integration and software development platform challenges will be resolved.· Implementation of a comprehensive COTS solution will commence sooner and

the overall implementation timeline will be delivered with greater confidence. · Business processes embedded in COTS solutions are based on international

best practices and will assist in improving the management of resources in the Public Service.

· Implementation of the COTS solution will enhance the development of skills in the ICT industry.

Benefits of Changing the Solution Architecture

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Cabinet Resolution of 2013

• Based on the outcome of the independent reviews, a recommendation was submitted to Cabinet to change the IFMS solution architecture to a single, integrated COTS solution, to be implemented with limited customization (a so-called “vanilla” solution).

• At its meeting on 20 November 2013 Cabinet approved the revised approach and solution architecture of the IFMS.

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Present Status ...we are on track to deliver, but with narrow margin for delays

Solution architecture:• Work on the hybrid IFMS solution was paused soon after the Cabinet

decision of November 2013.• Decision taken in consultation with IFMS Steering Committee to maintain

current IFMS functionality at lead sites, until deployment of new modules.• Engagements with service providers on the “old IFMS” to review the impact

of the change in the solution architecture on existing agreements, commenced.

• A process has been initiated by the IFMS PMO to gather information on Public Service policies and procedures as well as information on the current IFMS blue prints. This information will be used to identify any policy or procedure that may have to be adapted for a “vanilla” COTS solution, and/or where the system has to be changed to accommodate the policy and procedure. Outcomes will be confirmed during blueprint workshops once implementation partners have been appointed.

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Present Status (Contd.)...we are on track to deliver, but with narrow margin for delays

Procurement of Software and Licenses:• Initial RFP 1182/2013 (for software and lead site services) published during March 2014.• Objections were received from a potential bidder. Legal advice was subsequently obtained and while the

advice was considered, the validity period of the RFP expired and it was agreed not to extend the validity period.

• Lessons learned in the process were taken into account in determining the revised procurement approach.• IFMS Steering Committee considered and provided clear direction on the preferred approach which entails:

• RFP 1 - Procure COTS ERP software and licences, including ongoing upgrades and support for this software.

• RFP 2 – Procure services for initial design and configuration ( rollout template) and implementation at lead sites. Procure hosting infrastructure through separate RFP.

• RFP3 – Procure services for national rollout.• Current key priority is to successfully complete the procurement of software within the 2014/15 financial year.• RFP 1 was published on 28 November 2014 (RFP 1282/2014) and it closed on 30 January 2015. Bid

responses have been evaluated, currently in process of obtaining approval for appointment of successful bidder.

• RFP 2 – for development of rollout template and implementation at lead sites, being developed. A separate RFP for hosting infrastructure is also being prepared. Intention is to publish these tenders early in 2015/16 financial year.

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Present Status (Contd.)...we are on track to deliver, but with narrow margin for delays

PMO:

• PMO established, governance charters being developed.• Panel of service providers with a range of specialised skills is in place to

assist with governance and provide technical support where required. • Several functions within the PMO are being capacitated through

appointments from panel of service providers (programme management, strategic systems planning, organisational change management and communications, probity services).

Communication • IFMS website launched in October 2014 - www.ifms.gov.za• Communications Committee established.

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Present Status (Contd.)...we are on track to deliver, but with narrow margin for delays

Departmental readiness• The IFMS team has started with initial readiness reviews in some provinces and

national departments to assess the departments’ technical and organisational capacity to migrate to the new solution, and to initiate any enhancements that may be required.

• Detailed readiness surveys to be conducted in all departments to assist departments to prepare for IFMS implementation.

• Cost implications, hardware requirements and other preparations that may be required for implementation of IFMS will be communicated to departments as soon as possible.

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Interim Systems Considerations

• Moratorium on acquisition of systems• Moratorium on acquisition of IFMS related systems agreed by Cabinet in 2005 still in force. • Departments may approach National Treasury for possible deviations.• National Treasury agreed to allow interim implementation of LOGIS by any department.

• The current IFMS modules in operation (HRM, PMM, Item and Service Master and Catalogue Management) will continue to be supported where lead site (pilot) departments request that these systems be maintained.

• Legacy systems (PERSAL, BAS, etc) will be maintained and enhanced where considered critical for purposes of business continuity until the new IFMS solution has been acquired and implemented.

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Next Steps

• The high level planned next steps over the medium term are:

• 2014/15: Award software RFP (1282 of 2014).• 2015/16: Conclude software agreement, procure implementation services and

hosting infrastructure, blueprinting, development of solution, commence lead-site implementations.

• 2016/17: Conduct testing, compare parallel-system results, conclude analyses and undertake refinements where necessary.

• 1 April 2017: Lead sites go live and commence with national rollout to the rest of the Public Service.

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Thank you

Questions and discussions