1
Project Kick-Off
January 26, 2012
SAP Finance and
Procurement Implementation
2
Agenda
Topic Presenter
Welcome Marvin Cruz
Project Mission and Business Drivers Marvin Cruz
Introductions George Silva, Douglas Le
Project Overview Teri Lyons, George Silva,
Douglas Le
ASAP Methodology Overview Vikas Pathak
Organizational Change Management Christa Crawford
Wrap-up / Next Steps Christa Crawford
Q & A All
3
Key Stakeholders Remarks
• Ron Chandler, Chief Information Officer
• Mark Hovatter, Procurement Executive
• Michelle King, Senior Deputy Superintendent
• Megan Reilly, Chief Financial Officer
• Kelly Schmader, Chief Facilities Officer
• Bill Wherritt, Chief of Staff, Facilities Services Division
4
Mission Statement Increased operational efficiency leads to an optimized learning environment
• ITD Mission Statement:
– We enable student achievement and operational efficiency through deployment of
appropriate technical solutions for our students and their families, all employees, and the
community.
5
What is the Legacy Replacement Program?
• Massive overhaul of outdated Financial and Procurement legacy system (IFS)
– We are currently operating on 1990s technology. IFS (Legacy system) for
finance and procurement was implemented in 1993
– We are using software and hardware infrastructure that are no longer
supported
– Compliance with audit recommendation from the Los Angeles County Civil
Grand Jury (LACCGJ)
• Implementation of SAP Finance and Procurement Software
– Allows for the de-commissioning of IFS
– Establishes one District financial system of record: SAP
– Mitigates risk of catastrophic failure, inefficiency and cost related to the
maintenance of two financial systems: SAP + IFS
6
Business Drivers
Legacy Replacement Program is a Necessity
• Compliance with Audit Recommendation
– The Los Angeles County Civil Grand Jury Report, dated June 30, 2010,
recommended that the District “.. implement Release III, Accounts Payable and
related modules of Business Tools for Schools (BTS) as soon as possible..”
– The District agreed to comply with this recommendation via correspondence
sent to the LACCGJ in November 2010
• Risk of catastrophic failure, inefficiency, and increased cost
– Relying and supporting IFS exposes the District to these issues
– Completing the SAP finance and procurement implementation (formerly called
Release III) will mitigate and/or eliminate these issues
7
The Project Team
• LAUSD Project Team
• Phoenix Team
• SAP America
• Third Party Oversight
• Key vendors (such as Apple, Arey-Jones, McGraw Hill, Pearson)
8
Project Overview
9
System Implementation – High Level
Completed
Planned
SAP Integrated
Solution
• Human Resources
• Payroll
• Procurement
• Finance
IFS Procurement
Finance (active)
Legacy HRS/Payroll
(decommissioned)
10
Project Kick-Off
January 26, 2012
Current State
Human
Resource
Applicant
Tracking
Benefits
Administration
Payroll Time and
Attendance
Asset
Management
Budgeting
Cost
Accounting Inventory
Supply Chain
Management
Accounts
Payable
Contract
Management
Encumbrance
Processing P-Card
Vendor and Bid
Management
SAP
IFS
Other ITD
systems (e.g.
Transportation,
Facilities, Food
Services, ISIS,
MyData)
External
Organizations (e.g. STRS,
PERS, LACOE)
- Financial
reference
tables
- Job Cost
- Financial postings
- Budget data
Accounts
Receivable
Cash
Management General Ledger
Key
To be
Implemented
Partially
Implemented
Implemented
11
Future State
Cost
Accounting
Asset
Management Inventory
Supply Chain
Management
Accounts
Payable
Contract
Management
Encumbrance
Processing P-Card
Vendor and
Bid
Management
Other ITD
systems (e.g.
Transportation,
Facilities, Food
Services, ISIS,
MyData)
External
Organizations (e.g. STRS,
PERS, LACOE)
SAP
Key
Human
Resource
Applicant
Tracking
Benefits
Administration
Payroll Time and
Attendance Budgeting
Cash
Management
General
Ledger
Implemented
Accounts
Receivable
Future State – July 2013
12
An Example…
• The term “Requisition” in the legacy system will become “shopping carts”
in the new system. Requisition approval will be replaced by on-line
shopping cart approval for principals and department heads
• Schools and offices no longer have to differentiate between different
document types (RX, PD CSX, PD LVX, PD LVXC1, etc.)
• Schools and offices will have the ability to use a point-click functionality
to create shopping carts; one point of entry for schools and offices
“Shopping Cart”
IFS SAP
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Functional Scope - Procurement
Targeted Functionalities
• Supplier Relationship Management (SRM) • Shopping Cart (versus line-item
requisitions in IFS)
• Catalog Management
• Buyer Cockpit (e.g. E-commerce)
• Supplier Self-Service
• Accounts Payable • Electronic Invoicing
• Streamlined Goods Receipt
• Payment Process
• Operational and Statutory Reporting
• Full Warehouse Management • Receipt of stock
• Stock put-away
• Order fulfillment
• Physical Inventory
• Inventory Management
• Bar Coding Enablement
• Travel Management • Travel Request Form
• Employee Reimbursement Process
• Materials Management • Material Master
• Vendor Master
• Contract Management
• Purchase Order Processing
• Procurement Card (P-Card) • Interface between ProCharge II Software and SAP
14
Functional Scope - Finance
Targeted Functionalities
• Grants • Grant Master Data
• Resource Related Billing (RRB)
• Indirect Cost Calculation (IDC)
• Availability Control (AVC)
• Account Receivable and Cash Receipts • Accounts Receivable – General
(excludes Grant receivables)
• Cash Receipts
• Fixed Assets • Capital asset inventory (Master Data)
• Asset valuation
• Asset reporting
• Projects
• Master Data, Project Definition, Work
Breakdown Structure (WBS)
• Multi-Year Funding Strategy
• Multi-Year Budget Plan
• Settlement to Assets Under
Construction
• Availability Control (AVC) • Budget consumption and availability
• Real-time information on budget values
• Real-time information on budget
consumption values
• Budget limits and tolerances
• Job Cost • Internal Order Master Data
• Internal Billing
• External Billing (A/R)
• Availability Control (AVC)
• Job Cost Budget
15
Technical and Organizational Scope
• Technical scope
– SAP Components
• ERP Central Component (ECC 6.0)
• Supplier Relationship Management (SRM 7.0) with
Procurement for Public Sector (PPS 3.0)
• Supplier Self Services (SUS)
• Portal
• Master Data Management (MDM)
• Business Intelligence (BI)
• Process Integration (PI)
• GRC
– SAS (reporting platform)
– Custom development
– Security (roles and authorizations)
• Organizational scope
– All offices and schools
16 LAUSD and Phoenix teams
Project Steering Committee FI (Yumi T), Budget (Tony A); Procurement (Mark H);
Facilities (Bill W); ITD (George S, Doug L, Teri L);
LAUSD PM (Vikas P); PBC (Hanif S); SAP (TBD)
Project Management Team LAUSD PM (Vikas Pathak)
PBC PM (Hanif Sarangi)
Finance
Business
Advisory
Committee (see next slide)
ITD PMO LAUSD PMO
Marvin Cruz
3rd Party
Oversight
Team Vendor TBD
Executive Governance Committee Accountable: (CIO, CFO, COO, CFE)
Informed: (LD Sup, CAO, Asst Sup, Exec Dir, Ch. HR Officer, Personnel Director)
Champion the project
Ultimate responsibility of project success
Monitor the progress and organization
impacts of the project
KEY RESPONSIBILITIES
Manage project scope to keep project
on schedule
Commit required resources to the
project
Review project status and resolve
escalated issues
Support project management‟s efforts to
accomplish project objectives
Provide day-to-day direction, develop
and manage project plan and schedule
Identify, resolve, and escalate issues
Monitor all aspects of project progress
3rd Party Oversight
Provide independent monitoring and
oversight for the duration of project
Review project deliverables
Provide independent assessment
reports
LAUSD Core Team and Phoenix Team
Respond to 3rd party assessments, as
required
Manage project implementation
Perform activities to meet project
requirements
Procurement
Technical OCM (incl. Training)
Project Team Organization
17
Implementation Strategy
• Phased rollout – build and test all functionalities simultaneously,
but rollout to central offices and schools will be in four phases
• Use ASAP, SAP‟s implementation methodology
• Adopt best practices built into the system
• Train as much as possible and do extensive knowledge transfer to
LAUSD team
• Avoid “customizing” the system, use SAP standard configuration
wherever possible
• Extensive demos – build functionality and play back
• Project staffed with experienced consultants with expertise in K-12
and Public Sector (at the peak periods Phoenix Business
Consulting will have 40 consultants onsite)
• Extensive involvement from LAUSD staff in blueprinting,
documenting business process procedures, testing, training end
users and go-live support.
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Project Implementation Schedule
Rollout 1
Rollout 2
Rollout 3
Rollout 4
J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J J A S O N D J F M A M J
Project Preparation and Planning
Business Blueprint (Design)
Realization (Configuration, Development)
System Testing
Final Preparation
Go-Live and Rollout 1
System Stabilization
Rollout 2
System Stabilization
Rollout 3
System Stabilization
Rollout 4
System Stabilization
IFS Decommission
(Decommission includes year-end closing, historical data extraction, etc)
Q1 Q2 Q3 Q4
2012 2013Q1 Q2 Q3 Q4
20152014Q1 Q2 Q3 Q4 Q1 Q2
Financials + 4% Schools
32% of Schools
50% of Schools
14% of Schools
19
ASAP Methodology
Overview
20
Project Methodology (ASAP)
ASAP Methodology provides the links between
business and the system processes
21
Phase 1 – Project Preparation
(Scoping & Planning)
Deliverables: Project Scope Defined
Implementation Plan & Rollout Strategy
Costs and Benefits Validation
Project Standards
Project Infrastructure
Implementation Workplan
Milestones & Key Decisions:
High Level Scope Defined
Project Team Staffed and Trained
Project Team Organization,
Responsibilities and Location
Roll-out Plan
Key Stakeholders for Communications
Identified
Implementation Plan in Place
Purpose:
Initial Planning and Preparation
Define the project goals, scope
and objectives
Identify, on-board and train
Team Members
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Phase 2 – Business Blueprint
Deliverables:
Complete and Documented Business Design Project Plan Update Sub Process Definition Document Sub Process Flows Business Activity Scripts Key Functional Specs Business Process Master List
Assessment of Organization and Business Process
Changes
Detailed Scope Document
Inventory of Reports and Conversions
Knowledge Transfer Approach
Master Data Design
Interface List
Testing Strategy
Data Cleansing Strategy
Milestones: Complete Design
Phase Quality Assessment
Communication Plan
Policies for To Be Finance
Organization
System Retirement
Objectives/Mandates/
Constraints
Training Approach
Purpose:
Align Business Requirements to the
SAP Business Model
Identify Additional Functionality
Requirements
Identify Data Input Requirements
Document Business Process
Documentation
Obtain Business Sign-off on
Requirements
23
Phase 3 - Realization
Deliverables:
Test Data and Configuration
Business Process Procedures
Quality Assurance System Environment
Production System Environment
Develop and Test Interfaces, Conversions
and Reports
Evaluate and Enhance Security and
Controls
End-User Training Material and Plan
End-User Training System Environment
Data Conversion Plan
User Acceptance Test
Milestones:
Project Team Trained
(Realization)
Final Design and Configuration
Integration Test
End-User System Infrastructure
User Acceptance
Phase Quality Assessment
Readiness Review
Purpose:
Build and Test a Complete Business
and System Environment
Develop Training Material and End
User Documentation
Obtain Business Approval
24
Phase 4 – Final Preparation
Deliverables:
Data Converted
Cut-Over Plan
End-Users Trained
End-User System IDs Created
System Support Organization in Place
Help Desk
Technical Support
Operational Production System Environment
Milestones:
Organizational Changes
Implemented
Go/No-Go Decision
Purpose:
Prepare System for
Production Release
Prepare the Internal and
External Organization for Go-
Live
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Phase 5 – Go-Live and Support
Deliverables:
Live Production Environment
Operational Help Desk
Cut-Over and Conversion Activities
Completed
Post Go-Live End-User Training
Lessons Learned
Milestones:
Go-Live
Project Close
Purpose:
Business Owns and Executes New
Business Processes and Systems
Monitor Business Process Results
Monitor Production Environment
Establish Center of Excellence for
Support and Enhancements
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Organizational
Change
Management
User & Project
Team Training
Attend Training
Develop Courseware
Prepare Training Facilities
Manage Registration
Process
Deliver Training
Workforce
Transition
Org Impact Assessment
Org. Impact Summary
Role Mapping
Leadership
Alignment/
Stakeholder Mgmt
Understand Stakeholder
Segments
Communicate
w/Leadership &
Stakeholders
Conduct Info Sessions
Communications
Establish Plan
Support Departments with
Effective Communications
Gather Feedback
Provide
Demos/Roadshows
Readiness
User Readiness
Functional Readiness
Site Readiness
Technical Readiness
27
Wrap Up / Next Steps
• Business Blueprint is the next phase
– Blueprint sessions start February 13, 2012
– Design the „TO-BE‟ processes
• Complete project team training
• Complete project implementation plans
28
Welcome to Team LRP!!!
“Coming together is a beginning.
Keeping together is progress.
Working together is success.”
- Henry Ford
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