Financial Management Transformation

Transcription

1 Financial Management Transformation Focus on Value Financial Management Institute Professional Development Week November 29th, 2012 Patricia Sauvé-McCuan Assistant Comptroller General: Financial Management Transformation

2 Objectives of the Presentation To provide on overview of the: Federal Government Financial Management Transformation Context OCG Financial Management (FM) Transformation vision Considerations for Federal departments and agencies Expected end state Approach and roadmap to transformation 2

3 Federal Government Financial Management Transformation Context 3

4 This Time Last Year Budget 2011 had announced the streamlining of government operations through changing the way we do business SOR and DRAP reviews were underway Departments had submitted proposals to streamline operations, including those that support back office functions, which are now being implementing Strategic Direction to operate the government as one entity with best practices enterprise approach Creation of Shared Services Canada ion August 2011 Total Cost of Ownership and sub-optimization of resources across IT Programs is not sustainable and must be addressed on a priority basis Foundation element of the IT Strategy of the GC is to examine government-wide solutions that will standardize, consolidate and re-engineer the way it does business AG report on Aging IT had been issued Aging IT is a significant problem requiring new approaches to IT sustainability 4

5 GC Drivers in 2012 Consistent Enterprise Messages Budget 2012 reiterated the need to improve services and realize efficiencies by re-engineering the way we do business across the GC GC committed to reducing the cost of government by modernizing internal administrative operations 6 th Report of the PM S Advisory Committee on the Public Service Reiterated the need to transform GC administrative processes 19 th Annual Report of the Clerk of the Privy Council Departments must work collaboratively to standardize, streamline and shape operations to adopt a whole-ofgovernment approach 5

6 GC Drivers in 2012 Consistent Enterprise messages (cont d) Deficit Reduction Action Plans Departments had submitted proposals to streamline operations, including those that support back office functions, which are now being implemented January 2012 HR Modernization TB decision May 2012 GC ERP Standard was published Mandatory TBS policy that directs investments in Financial Management Systems to SAP Exemptions to policy must be formally requested to TBS 6

7 Business Objectives of the ERP Standard ERP Standard was effective May 01, 2012: Enterprise Resource Planning (ERP) is defined as a technology strategy that integrates a set of business functions such as finance, materiel, human resource (HR), purchasing and asset management, through tight linkages from operational business transactions through to financial records. The implementation of standard ERP systems supporting common business processes will improve the quality, timeliness and reliability of information for decision making, both within departments and government-wide and will serve over time, to reduce inefficiencies, duplication and costs in back office administration Maximize the benefits of the GC's investments in ERP systems by rationalizing the number and diversity of systems of record in use, thereby reducing the complexity and overall costs associated with implementation and ongoing operations, through increased standardization and economies of scale. 7

8 What is Financial Management Transformation? FMI Conference 2011: Common Understanding is key What is a financial management system (FMS)*? A combination of business processes, procedures, controls, data and software applications which produces financial and non-financial information It is more than the technology enablers, more than the applications which support those processes * Policy on the Stewardship of Financial Management Systems August 2012: Comptroller General announced the creation of Assistant Comptroller General Financial Management Transformation to provide leadership for the transformation of the FMS for the GC to provide a consistent FM approach across the GC enterprise 8

9 The Financial Management Environment B revenues 369,000 FTEs >1 M payments per working day 5 DFMS* in use 132 Departments & Agencies 88.2% expenditures managed through SAP* 81% FTEs in departments using SAP* Sources of Data: * With HRSDC as an SAP user Public Accounts Departmental RPPs Association of Canadian Financial Officers Administrative Systems Inventory B expenses 9

10 Public Accounts Expenditure ($M) by DFMS ( ) Oracle % CDFS >1% Freebalance % GX % CDFS Freebalance SAP % GX SAP Oracle * With HRSDC as an IFMS user Sources of Data: Public Accounts Administrative Systems Inventory

11 What are the Financial Management Components in the GC? 11

12 Vision for Financial Management Transformation 12

13 Financial Management Transformation Vision Statement To implement a hosted FM application services model, which leverages a common SAP configuration for FM for the Government of Canada 13

14 End State 14

15 End State vision for Financial Management Systems PRESENT SITUATION ( ) IFMS Oracle CDFS G/X HC FreeBalance e TBS TC CHR T IC FM Transformation Governance and Engagement FM TRANSFORMATION LENS CEDI (Common Data) FM-BP (Common Processes) GC FM Config Requirements SDA SAP Project SAP CoE FM Application Services Governance Central Configuration Management GC Common SAP FM Config GC Common Service Standards POST-TRANSFORMATION AND CONVERGENCE Hosted Application Services SDA Host Host 2 Host 3 Futur e Host 4 Host 1 Futur e 5 DFMS configurations Most departments and agencies have their own in-house FM System. Over 100 departmental charts of accounts Differing services and standards Temporary Permanent 1 SAP common configuration used by hosts, each of which one applications service provider and several client departments and agencies 15

16 Three Models of Systems Delivery Back Office: Common Administrative Applications Clustered- Based Delivery Human Resources Systems Networks Materiel Management Systems Grants and Contributions Health Information Systems Front Office: Departmental Delivery Front Office: Departmental Delivery Benefit and Income Redistribution Systems Taxation Systems Front Office: Departmental Delivery Case Management Immigration Public Security Public security Taxation systems Recruitment and Learning Systems Border and Perimeter... Datacentre: Facilities, Servers Centralized Government Delivery Pay & and Pension Financial Systems Information Management Real Property Centralized GC Delivery Sample of GC Applications 16

17 Roadmap 17

18 FM Transformation Road Map Current State Cooperative governance of COTS products 5 different COTS products & many smaller applications 522 FM applications 431 Materiel Management systems 237 Travel systems Various versions Various customized configurations Different business processes and data standards Predominantly departmental support and maintenance New ERP Standard Proposed FM way forward Establish governance Strong central leadership Determine strategy and manage transformation program Convergence roadmap Determine hosts, concept of operations Departments reduce current efforts on own systems, prepare for common SAP hosted solution OCG process and data standards Standardization policy instruments Build Common SAP configuration Convergence implementation Repeatable on-boarding approach Target State Modern and efficient FM operations and systems, enabled by a GC Common SAP Configuration Limited number of hosts, each with several clients Governance on a government-wide basis Standardized data Common business processes Centralized SAP configuration control Common Standards 18

19 Approach to Transformation Create governance structure for FM at GC level + Set up governance for convergence period Develop & implement engagement strategy for GC FM Community Create Transformation program plan and seek funding Build common SAP configuration Complete common data and processes work Establish Project governance/oversight Lever the IFMS work, HRSDC work and Small Department and Agency work as much as possible Leverage existing expertise Leverage what is already done or being done Determine convergence roadmap Work with CIOB ensure coherent TBS way forward Pursue the art of the possible : leverage opportunities, take iterative steps to get there Encourage engagement, provide central direction Whole of Government approach to transformation 19

20 Considerations for Federal Departments and Agencies 20

21 What does this mean for Departments and Agencies? Need to understand impact for own department and help position department for transformation Enterprise, common approach for FM processes and workflows at the operational level New Applications Management Service (AMS) Model Most departments will no longer own or support their own FM applications Will either be one of few host departments that provide FM AMS, or will be a consumer of FM AMS Will obtain greater business value from SAP FM system Ability to participate and contribute to FM transformation through community engagement and governance Need to consider and manage financial impacts of moving to GC-wide approach 21

22 Some Keys to Success Clarity and understanding of future state; agreement on expected outcomes and measures Achievable roadmap that ensures benefits in timeframe expected of this Government Leveraging the business rules and processes of our SAP platform Central leadership, clear governance; with horizontal collaboration and engagement Congruence within TBS, central agencies Understanding unique needs & challenges of SDA s 22

23 Next Steps 23

24 Next Steps - Timeframe Communicate OCG FM transformation vision & way forward Develop Governance model details Solicit Approvals Contribute FM Apps Business Case With CIOB Secure related funding Develop FM program plan and convergence roadmap Develop stakeholder engagement strategy Build core SAP config Summer 2012 Fall 2012 Winter

25 Common Understanding of Value is Key Message from 2011 FMI presentation: what is bringing value? Value from technology is more than cost savings If cost reduction is the only value we measure, then we have probably used the technology to automate clerical/administrative processes, and have not looked at providing strategic value In 2012 and beyond FMT: needs to focus on the expected value of the strategic drivers and expected business outcomes needs to focus on value at the Departmental level and across the Enterprise of the federal government 25

26 Questions? Thank you! 26

27 Contact information: Patricia Sauvé-McCuan Assistant Comptroller General, Financial Management Transformation