HomeMy WebLinkAboutAgenda_GGAF_05.31.2017Notice of Meeting for the
General Gov ernment and Finance Adv isory Board
of the City of Georgetown
May 31, 2017 at 4:30 PM
at Georgetown Communications and Technology Conference Room, located at 510 West
9th Street, Georgetown, TX
The City o f G eo rgeto wn is committed to comp lianc e with the Americans with Dis abilities Ac t (ADA). If yo u
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Office, at leas t three (3) days prior to the sc hed uled meeting d ate, at (512) 930-3652 o r City Hall at 113 Eas t 8th
Street fo r add itional info rmation; TTY us ers ro ute through Relay Texas at 711.
Legislativ e Regular Agenda
A Review the minutes from the Marc h 29, 2017 General Go vernment and Financ e Advis o ry Bo ard meeting -
Danella Ellio tt, Bo ard Liais o n
B Dis cus s ion of the Enterp ris e Res o urc e Planning p ro ject - Leigh Wallace, Financ e Directo r
C Emp lo yee C o mp ens atio n, Benefits and Wellnes s Up d ate - Tad d Phillips , Human Resources Direc tor
CERTIFICATE OF POSTING
I, Shelley No wling, C ity S ecretary fo r the C ity of Geo rgeto wn, Texas , d o hereby c ertify that this Notice of
Meeting was p o s ted at City Hall, 113 E. 8th Street, a p lace read ily acc es s ible to the general p ublic at all times ,
on the ______ d ay o f __________________, 2017, at __________, and remained so p o s ted fo r at leas t 72
c o ntinuo us ho urs p receding the sc heduled time o f s aid meeting.
____________________________________
S helley No wling, City Sec retary
Page 1 of 103
City of Georgetown, Texas
Government and Finance Advisory Board
May 31, 2017
SUBJECT:
Review the minutes fro m the March 29, 2017 General Government and Financ e Ad vis ory Board meeting -
Danella Ellio tt, Board Liaison
ITEM SUMMARY:
Review the minutes fro m the March 29, 2017 GGAF Bo ard meeting.
FINANCIAL IMPACT:
N/A
SUBMITTED BY:
Danella Ellio tt, Exec utive As s is tant
ATTACHMENTS:
Description Type
3.29.17 Draft GGAF Minutes Backup Material
Page 2 of 103
Minutes
General Government and Finance Advisory Board
City of Georgetown, Texas
Wednesday, March 29, 2017 at 4:30 PM
The General Government and Finance Advisory Board met on Wednesday, March 29, 2017 at 4:30 PM at the
Georgetown Communications and Technology building (GCAT), located at 510 West 9th Street, Georgetown,
Texas.
Board Members Present: City Staff Present:
Tommy Gonzalez, Chair David Morgan, City Manager
John Hesser, District 3 Laurie Brewer, Assistant City Manager
James Bralski Leigh Wallace, Finance Director
Chere` Heintzmann
Board Members Absent:
Severine Cushing
Tadd Phillips, HR Director
Laura Maloy, Assistant HR Director
Niki Ross, HR/Benefits and Wellness Administrator
Paul Diaz, Budget Manager
Chris Bryce, IT Director
Nathan Parras, Budget Analyst
Greg Berglund, Assistant IT Director
James Davis, IT Operations Manager
Sabrina Poldrack, Administrative Assistant
Others Present:
Lance Pendley, McGriff, Seibels & Williams
Sandy Brown, McGriff, Seibels & Williams
Legislative Regular Agenda
Tommy Gonzalez, Chair called the meeting to order at 4:30 p.m.
A Review minutes from the March 1, 2017 General Government and Finance (GGAF) Advisory Board --
Danella Elliott, Executive Assistant
Board did not have any comments regarding the minutes from March 1, 2017.
Motion to approve the minutes by James Bralski, second by Chere` Heintzmann. Approved 4-0; Severine
Cushing absent.
B Consideration and possible approval of recommendation to solicit a Request for Proposal for a third-
party onsite employee clinic vendor – Tadd Phillips, HR Director
Tadd and the consultant provided an overview presentation. The board had many questions and concerns. John
asked why they are checking into this, and David said we were being proactive to take measures to be prepared
and knowledgeable about rising healthcare costs and explore different options.
After a lengthy discussion, David suggested that we bring this item forward at a later date, prepare an update
on the Self Insurance Fund and provide additional material at that time. He noted that this is not a deadline-
driven item; we are just attempting to make sure we cover all bases and explore every avenue possible.
The Board thanked Tadd and the McGriff, Seibels and Williams representatives for the presentation and
discussion.
Page 3 of 103
Minutes
General Government and Finance Advisory Board
City of Georgetown, Texas
Wednesday, March 29, 2017 at 4:30 PM
C Consideration and possible approval of a contract with Stewart Organization to provide managed
computer printer and photocopier services for an amount of $130,000.00 – Chris Bryce, IT Director;
James Davis, IT Operations Manager
Chris explained that he is requesting approval of a new contract to provide managed printing services. He noted
that the contract was quoted by three vendors, and Stewart Organization offers the best solution for the new
contract.
The following items are included in the contract:
- All OEM toner
- All service, OEM parts, and repairs
- Initial and ongoing replacement of multi-Function, black & white, and color printers at no cost except
for added page counts (all new and replacement equipment becomes property of the City)
- Removal and disposal of any replaced or retired units
- Print fleet reduced to 2 manufacturers and 15 models of printers
- 2 print drivers to manage
- All printers purchased with in the last two years will not be replaced, saving the City’s investment in
these units
Chris said that Legal is reviewing the contract. John and Tommy suggested that he add some additional
information, including the total number of machines and different types, when presenting this item to Council.
Motion to approve Item C by James Bralski, second by John Hesser. Approved 4-0; Severine Cushing absent.
D Consideration and possible approval of a contract with Fiberlight, LLC to provide a second dedicated
internet service for a total of $63,000 over three years – Chris Bryce, IT Director
Chris explained that the proposed contract will add a second internet connection at 200 megabits/second with
a separate internet service provider to be terminated at the Public Safety complex. This will allow City staff to
stay connected to internet services should our primary internet service provider, router, or firewall located at
the GCAT building go down.
There were no questions from the board.
Motion to approve Item D by James Bralski, second by John Hesser. Approved 4-0; Severine Cushing absent.
Page 4 of 103
Minutes
General Government and Finance Advisory Board
City of Georgetown, Texas
Wednesday, March 29, 2017 at 4:30 PM
E Discussion and possible action to recommend FY 2017 budget amendments to the Council Discretionary
Fund – Leigh Wallace, Finance Director
Leigh told the Board that the Council Discretionary Fund was established in 2015. The purpose of the fund is to
take year-end balance in the General Fund and determine appropriate one-time uses. The current available
balance of the fund is $1,919,824.
The handouts (listing of Long-term Commitments, Reservations and Other Unfunded Liabilities and Council
SRF Amendment Options) provided by Leigh were reviewed. Discussion followed, including suggestions to
use the funds for Tier 1 (current obligations) and Tier 2 (unfunded liabilities), and prioritize the remaining list.
Motion to recommend Tier 1 and Tier 2 funding and present a staff-recommended prioritized list of other options,
and let Council decide on the use of available funds, either from the list or make their own recommendation for
one-time use of the approximate $800,000 remaining funds.
Motion to approve Item E by Chere` Heinzmann, second by John Hesser. Approved 4-0; Severine Cushing
absent.
Tier 1
Tier 2
Page 5 of 103
Minutes
General Government and Finance Advisory Board
City of Georgetown, Texas
Wednesday, March 29, 2017 at 4:30 PM
Adjournment
Motion to adjourn the meeting at 6:27 p.m. by Chere Heintzman; second by John Hesser. Approved 4-0
__________________________________ ____________
Tommy Gonzalez Date
Board Chair
__________________________________ ____________
Severine Cushing Date
Board Secretary
__________________________________ ____________
Danella Elliott Date
Board Liaison
Page 6 of 103
City of Georgetown, Texas
Government and Finance Advisory Board
May 31, 2017
SUBJECT:
Disc ussion of the Enterprise Resource Planning projec t - Leigh Wallac e, Financ e Direc tor
ITEM SUMMARY:
In Oc tober of 2016, the City contrac ted with Plante Moran to provid e c ons ulting s ervic es fo r s elec tio n of
an enterp ris e reso urc e planning s ystem. The City currently has no integrated s ys tem fo r HR functio ns. The
City has us ed Tyler ’s Inco d e for more than 20 years for acc o unting, p ayro ll and limited purchas ing
functio ns. T he p ro ject with Plante Moran will res ult in a need s as s es s ment of HR and F inance b usines s
functio ns, a s elec tion s trategy fo r an ERP, is s uance of a formal solic itation fo r s o ftware s o lutio ns, vendor
evaluation and d ue d iligence activities , and negotiation services with the selec ted vendor.
City s taff and Plante Mo ran have c o mpleted the Needs As s es s ment phas e of the projec t and are ready to
mo ve fo rward to the solic itatio n s tage. Staff will pres ent the c o ns ultant’s selec tio n strategy fo r GGAF
input, and then will p res ent the informatio n to C ity C o uncil.
FINANCIAL IMPACT:
N/A
SUBMITTED BY:
Leigh Wallace, Financ e Directo r
ATTACHMENTS:
Description Type
ERP Pres entation Pres entation
Needs As s es s ment Report Backup Material
Page 7 of 103
5/26/2017
1
FY2017 Annual Budget
GGAF May 31, 2017
Enterprise Resource Planning
Project Update
1
FY2017 Annual Budget
Project Purpose
•Project approved and funded in FY 2017 Budget
•Conduct a needs assessment for finance and human
resources functions
•Provide a selection strategy
•One solution or two?
•Hosted on premise or in the cloud?
•Product tier 1 or tier 2?
•Select an integrated enterprise resource planning
system
•Facilitate change management in the organization
2
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5/26/2017
2
FY2017 Annual Budget
Project Timeline
3
We are here
FY2017 Annual Budget
Background Information
•Phase 0: Project Management
–Establish Charter and project plan
–Establish Steering Committee
•Phase 1: Needs Assessment and Strategy
–Technology review
–Business process review
–Key findings
–Selection strategy
4
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5/26/2017
3
FY2017 Annual Budget
Needs Assessment Key Findings
•Incode lacks modern ERP funcƟonality
•No ‘true’ HR system/module implemented
•Incode’s limitaƟons force use of side systems
•Lack of integration between City systems
& Incode modules
•Chart of Accounts does not meet City needs
•Limited access to real‐Ɵme data
•Lack of training & system access
•Lack of user‐friendly / flexible reporting
5
FY2017 Annual Budget
Selection Strategy Options
6
# OpƟon DescripƟon
1. On‐Premise Procure hardware and software for a new
ERP system deployed in the city’s
environment on‐premise.
2. Private Cloud Procure software for a new ERP
environment and deploy in the vendor’s
environment via a “private‐cloud”.
3. Public Cloud Subscribe and implement an ERP “Public
Cloud” soluƟon.
Page 10 of 103
5/26/2017
4
FY2017 Annual Budget
ERP Marketplace
•Most vendors currently offer both on premise and
cloud products that will meet our needs
•Most major vendors are consolidating their product
lines to meet public and private sector needs
•Plante forecasts vendors will begin tapering off on
premise solutions and move more to cloud
•Cloud vendors are likely to bid aggressively to break into
the government/mid‐size organization client market
•Tier 1 products will exceed our needs and likely be too
large, complex and expensive for successful
implementation and support
•Most Tier 1.5 and 2 products will offer a fully integrated
ERP that will meet our needs (versus best in breed)
7
FY2017 Annual Budget
Recommendation: One System, Private
or Public Cloud, Tier 1.5 or 2
Advantages
•No purchase of
infrastructure
•Fewer FTEs needed to
support
system/infrastructure
•Scalable with growth
•Extremely secure
•Upgrades required
•Minimal to no customization
Disadvantages
•Less control over system
updates
•Ownership of data, future
migrations may be difficult
•Higher ongoing costs
•Integrations with other
existing systems may be
more difficult and expensive
8
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5/26/2017
5
FY2017 Annual Budget
Initial Cost Estimates
•Basic Assumptions across all scenarios:
–Used real cost proposals and contract data from
Plante Moran clients of similar size and complexity
–Third party implementation project manager
–Implementation will take 18 months
–Inflation of license/support fees 3% per year
–3 new FTEs needed for ongoing support of
selected system
–Project Contingency: 25% of one‐time costs
9
FY2017 Annual Budget
Initial Cost Estimates
•Differences between on premise and cloud
–Hardware costs for on premise
–Ongoing software license fees for cloud
–Tier 1 systems (“high scenario”) take more effort
from staff and third party to implement due to
complexity
–Tier 1 system price likely out of range of
Georgetown
10
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5/26/2017
6
FY2017 Annual Budget
Initial Cost Estimates: First Year
11
FY2017 Annual Budget
Initial Cost Estimates: Remaining and
Total Cost of Ownership
12
Page 13 of 103
5/26/2017
7
FY2017 Annual Budget
FY 2018 Budget Request
•Includes total one‐time costs (18 months)
–Debt funded with 7 year amortization
•Includes 3 FTEs for system support
–Funded through IT and Joint Services allocation models
•Includes one year of subscription fees
–Funded through IT allocation model
•Excludes existing “FTE effort”
•Assumes costs of Private Cloud High Scenario as a
middle point among the range for budget purposes
•Competitive procurement will leave option open to
private or public cloud
13
FY2017 Annual Budget
FY 2018 Budget Request $3.5M
14
Page 14 of 103
5/26/2017
8
FY2017 Annual Budget
Estimated Annual Ongoing Costs
FY 2019 and beyond
15
Current annual costs of Incode $380,000
New annual estimated ongoing costs $850,000
Ongoing budget need ‐approximately $470,000
•Estimate only. Final amount will depend on
multiple variables, including savings on other
smaller systems that may get replaced besides
Incode
FY2017 Annual Budget
Next Steps
•Council Feedback mid June
•Finalize RFP late June
•Release RFP July
•Review Responses August
•Conduct due diligence activities Sept ‐Oct
•Select system and vendor November
•Develop implementation strategy 2018
16
Page 15 of 103
;
ERP Needs Assessment Report
CITY OF GEORGETOWN, TX | MAY, 2017
Page 16 of 103
City of Georgetown, TX
ERP Needs Assessment MAY 2017
1 | Page
Table of Contents
1. Executive Summary ................................................................................. 2
1.1 Project Background ........................................................................................................................ 2
1.2 Project Goals & Objectives ............................................................................................................. 2
1.3 Assessment Scope ......................................................................................................................... 3
1.4 Project Approach ............................................................................................................................ 4
1.5 Summary of Key Findings .............................................................................................................. 5
1.6 Options Analysis Summary and Recommendation ........................................................................ 7
2. Current Systems Assessment ................................................................. 9
2.1 SWOT Analysis ............................................................................................................................... 9
2.2 Key Issues and Opportunities ....................................................................................................... 10
2.3 Application Inventory and Preliminary Migration Plan .................................................................. 23
2.4 Application Inventory .................................................................................................................... 24
2.5 Current Technology Profile ........................................................................................................... 31
2.6 Technology Assessment and ERP Readiness ............................................................................. 31
3. Options Analysis & Recommendation .................................................. 36
3.1 ERP System Deployment Options ................................................................................................ 36
3.2 ERP System Deployment Comparison ......................................................................................... 36
3.3 ERP System Deployment Comparison Matrix .............................................................................. 37
3.4 ERP System Deployment Considerations .................................................................................... 38
3.5 Total Cost of Ownership (TCO) Comparison ............................................................................... 40
3.6 Options Analysis & Recommendation .......................................................................................... 47
4. ERP Marketplace Overview ................................................................... 51
4.1 Vendor Consolidation Update ....................................................................................................... 51
4.2 Market Consideration: Tier 1 vs. Tier 2 ERP ................................................................................ 51
4.3 Market Consideration: On-Premise Vs. ‘the Cloud’ ...................................................................... 54
4.4 Market Consideration: Integrated ERP vs. Best-of-Breed ............................................................ 56
Page 17 of 103
City of Georgetown, TX
ERP Needs Assessment MAY 2017
2 | Page
1. Executive Summary
1.1 PROJECT BACKGROUND
The City of Georgetown (the City), located approximately 30 miles outside of Austin, Texas is home to
approximately 63,000 citizens and growing at a rate of almost 8%. The City was named the nation’s
fastest growing city with a population of 50,000 or more according to the US Census Bureau in 2015. As
the community continues to grow rapidly, the City as an organization recognizes the need to enhance
efficiency internally which requires resources and technology to support these goals. Within the City,
Finance, Human Resource (HR) and Information Technology (IT) departments are core internal functions
supporting all other City services such as Development and Planning, Police and Fire, Parks and
Recreation, Library, Facilities, Engineering and Business Resource Management, Municipal Court,
Customer Care, Public Works, and Utility Operations.
The City has been operating on the legacy version of Incode 9 (a subsidiary of Tyler Technologies) as its
primary financial management system since January 1995. Incode modules deployed to date and utilized
in various capacities, include:
• General Ledger
• Accounts Payable
• Accounts Receivable
• Budget
• Cash Receipts
• Time & Attendance
• Payroll
• Utility Billing
• Municipal Court
• Fixed Assets
• Purchasing
• Human Resources
The City does not currently have a full service human resource platform, although Incode does provide
some basic human resource and payroll functionality. In addition, departments throughout the City use
decentralized side systems, such as Microsoft Excel, to manage information due to the limitations of
Incode. The City replaced the fixed asset system in October 2014 and is in the process of replacing the
Incode Utility Billing module with a new Customer Information System (CIS).
The City recognizes that their aging version of Incode without a SQL server database on the backend
may be deficient in supporting certain business needs. Many City staff have articulated their concerns
with lack of functionality and challenging usability of the current system. Additionally, the City has recently
experienced a fair amount of staffing changes in various departments/divisions which has presented a
unique opportunity to define a strategic course of direction for improving their Enterprise Resource
Planning (ERP) environment and related business processes.
1.2 PROJECT GOALS & OBJECTIVES
The City is reviewing its ERP software environment with the following goals in mind:
1. Identify challenges including people, process and technology with current City ERP-related
business processes
2. Identify opportunities for process improvements without and with new technology
3. Identify system needs for a new ERP system
4. Move forward with selecting and implementing a new enterprise resource planning environment
Page 18 of 103
City of Georgetown, TX
ERP Needs Assessment MAY 2017
3 | Page
To support these goals, in October 2016 the City engaged Plante & Moran, PLLC (Plante Moran) to:
1. Conduct a comprehensive needs assessment for the City’s ERP software environment and
related business processes to identify City needs for the system replacement of the legacy
Incode solution
2. Identify opportunities for process improvements and provide recommendations to address issues
and gaps related to the current system and business processes
3. Provide an options analysis and recommendation of new ERP system deployments including total
cost of ownerships for each option
4. Conduct current state business processes mapping for key established business process
1.3 ASSESSMENT SCOPE
Included in the scope of this assessment were the following key business processes spanning over two
major business functions.
Business Functions Business Processes
Financial Management • Accounts Payable
• Bank Reconciliations
• Budgeting
• Cashiering/Point of Sale (POS)
• Cash Management
• Cash Receipting
• Contracts and Grants Management
• Debt Management
• Fixed Assets
• Financial Reporting
• General Ledger
• Inventory Management
• Investment Management
• Miscellaneous Billing/Accounts Receivable
• Project and Grant Accounting
• Purchasing
• Travel and Expenses
Human Resource Management • Absence/Leave Management
• Applicant Tracking/Requisitions
• Employee Performance Reviews
• Employee Self-Service
• Human Resources
• Learning Management
• Payroll
• Risk Management
The project scope excluded recommendations for systems and processes outside of the above functional
areas. However, interfaces to additional systems were included as part of the review due to the
importance of their functions in supporting the related business processes covered within the scope of the
project.
Page 19 of 103
City of Georgetown, TX
ERP Needs Assessment MAY 2017
4 | Page
1.4 PROJECT APPROACH
The following chart illustrates the approach that was taken in performing the ERP Needs Assessment:
The project was conducted using a participative and inclusive approach with significant input from City
management and staff to ensure accuracy, completeness, and ownership of the resulting
recommendations. Participation was obtained through the following activities:
• Developing a Project Steering Committee to assist in creation of the project charter, work with the
City staff to identify needs, make decisions about the project, and review and provide feedback
on project deliverables.
• Facilitating project management status meetings to manage project activities and provide status
updates.
• Conducting interviews with City management, departmental end users, and process owners to
evaluate current systems and business processes.
• Collection and review of numerous documents provided by the City, as well as completed
questionnaires by department staff.
• Soliciting input from the participating Departments that included the evaluation of the following
items: identification of current systems, duplicate entry / re-keying of information, strengths and
issues with / shortcoming of current systems, strengths, unused features / functionality of current
systems, opportunities to interface systems, unique City business rules, vendor interaction,
current and future technology project initiatives
The process for implementing new technology not only focuses on the technology itself, but also aims to
enhance existing business processes performed by individual departments across the City. Technology
is intended to enhance departmental business processes by:
• Making them more efficient
• Making them more effective
• Improving decision-making
• Providing enhanced customer service to both internal and external customers
• Improving access to information
• Streamlining processes to reduce costs.
Page 20 of 103
City of Georgetown, TX
ERP Needs Assessment MAY 2017
5 | Page
1.5 SUMMARY OF KEY FINDINGS
The approach Plante Moran followed in developing the needs assessment report focused on identifying
how the current technology applications supports the City’s business goals and denoting opportunities for
improving the effectiveness of business processes performed at the City in the future. Below is a
summary of key current state findings and key opportunities detailed further in Section 2: Current State
Assessment of this report.
Key Current State Findings
There were a number of consistent themes noted throughout each of the functional areas. The key high-
level current state findings are summarized as follows:
Aging Incode system
lacks functionality and
automation capabilities
available in modern ERP
systems
Incode lacks functionality that is standard in modern ERP systems (either
because they are not available or were never implemented) including robust
search capabilities, self-service capabilities, full integration between all
modules and linking related documents, electronic workflow, dashboard
capabilities and user friendly reporting. These automated functions can
significantly enhance efficiencies, as they enable users to complete and
route transactions to the appropriate decision makers leveraging the use of
notifications and queues.
HR processes are manual
and paper based as there
is currently no system or
ERP module in use
The City’s Human Resources (HR) department does not currently have an
integrated set of applications designed for personnel management,
employee self-service, applicant tracking, payroll processing integrated
with personnel master file, and training and certification management
resulting in manual and paper based processes. Human Capital
Management is commonly offered as a primary module within new ERP
systems to manage these activities and support the organization’s HR and
Risk Management responsibilities.
Current system limitations
requires the use of side
systems and processes
To address gaps in the current system, the City uses many side systems
and processes (i.e. individual Microsoft Excel spreadsheets, Access
databases, and paper files) that require excessive time to use and
maintain. Replacing these systems with an integrated ERP system can
reduce the effort required to maintain the information, make information
more accessible to others, prevent data loss, decrease manual
reconciliation, and reduce the risk of human error through duplicate entry
or structured import.
Lack of system
integrations eliminates
automation opportunities
The City’s use of multiple standalone systems utilized by departments with
limited or no automated integration to Incode causes significant delays,
multiple sources of truth, manual and redundant data entry, manual
processes and reconciliations, and limited reporting as staff do not have
access to necessary, detailed information in real-time.
The chart of accounts
design no longer meets
the City’s requirements
The chart of accounts does not have a consistent structure across all
departments and object codes have different meanings in different
departments. Departments are requesting new general ledger accounts,
typically as a work around to manage projects, grants, and funds at a more
granular level. This has made the chart of accounts very large and
cumbersome to manage. A redesign of the chart of accounts is needed
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City of Georgetown, TX
ERP Needs Assessment MAY 2017
6 | Page
and a change in processes on how to manage this change is required to
improve reporting capabilities.
Limited access to real-time
data makes it difficult to
make financial decisions
Due to limitations in Incode, many business processes are manual, paper-
based, and very time consuming. This creates a considerable lag time of
updated data to be accessible in the system and in reports. For example,
the majority of the budget process is done outside the system and an
extremely cumbersome process. Therefore, departments do not have
access to their updated budgets for the current year until after the year
begins.
Lack of training and
system access
Many departments rely on Finance or IT to run or query reports on data
from Incode due to lack of training and system access. Additionally, they
rely on Excel spreadsheets or other systems to store duplicate information
so that they have real-time information accessible to them.
Key Opportunities
There were a number of consistent themes noted throughout each of the functional areas. The key high-
level opportunities are summarized as follows:
Full integration between City
systems and ERP modules
Full integration between all ERP modules and core City systems will
allow for the elimination of side systems, duplicate entry, and manual
reconciliations.
Immediate access to real-time
data
Eliminating side systems and manual or paper based processes will
allow for real-time, immediate update and access to financial
information and reporting.
Improved reporting
capabilities
User-driven, user-friendly and flexible reporting tools that support the
information needs of staff and client including tracking and reporting of
performance metrics.
Enhanced automation and
online workflows and
approvals
Elimination and/or reduction of manual and paper-based processes by
replacing with automated, online workflows and approvals.
Streamlined business
processes aligned with best
practices
New ERP system allows for streamlining business processes and
incorporating established government best business practices.
Improved training for City
staff
An ERP replacement project is an ideal time to develop and provide
training to City staff on new system and processes.
Select a system deployment
model that best meets the
needs of the City
ERP systems and vendors currently in the marketplace offer several
system deployment models that can be assessed and selected to best
meet the needs of the City.
Overall, the majority of the unmet needs that are listed above could be met by a public sector based ERP
system with a common database.
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City of Georgetown, TX
ERP Needs Assessment MAY 2017
7 | Page
1.6 OPTIONS ANALYSIS SUMMARY AND RECOMMENDATION
ERP System Deployment Options
Consistent with project objectives to replace the legacy ERP system, this options analysis compares the
system deployment options currently available in the marketplace to implement a new ERP system.
Ultimately, this analysis and recommendation will assist the City in making a strategic decision for the
ERP system deployment method that best meets the needs of the City.
There are three (3) distinct ways to implement an ERP solution: traditional on-premise, traditional vendor
hosted (‘Private-Cloud’), and Software-as-a-Service (SaaS) Public Cloud. Therefore, the City has three
primary options in regard to the strategic direction of deploying the new ERP system:
Option 1:
On Premise
The City would procure the hardware and software for a new ERP system and
deploy in the City’s environment on-premise.
Option 2:
Vendor
Hosted
The City would procure the software for a new ERP system and host in the
vendor’s environment off-premise via a ‘private-cloud.’
Option 3:
Public Cloud
The City would subscribe to and implement an ERP ‘Public Cloud’ solution.
Recommendation
Plante Moran evaluated three scenarios to assist the City in making a decision on a preferred approach to
modernize the ERP environment. Plante Moran believes that all three of the options presented are viable
considerations for the City. All three of them have advantages and disadvantages, so therefore it is
important that the City consider the ultimate goals and criteria that will be used to measure the success of
the project. Based on the City’s current ERP environment and other factors that tie into the process of
making a decision that will best serve the needs of the City over the long-term, Plante Moran viewed the
following key criteria and factors in assessing each of the options and making a strategic direction
recommendation:
• ERP system replacement project Total Cost of Ownership (TCO)
• City FTE’s available to implement and support ERP
• City technical infrastructure
• System deployment “fit” with what is generally observed with other organizations of a similar size
and complexity
• Ability for the City to take on risks, such as availability of resources during implementation,
tolerance for change, sustainability of complex technology investments, and long-term support for
• Ability to expand the solution set to incorporate needs that have not currently been implemented
• City staff knowledge and use of current technology capabilities and best/next business practices
that exist in current ERP systems
• Ability for City to commit the necessary resources for the change to include both staff time and
financial expenditures
• Timeframe associated with achieving benefits from each deployment option
• Desire to lessen dependence on internal IT support resources
• Willingness for the City to consider solutions that are hosted external to the City
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Based on the above factors as assessed by Plante Moran during the course of our interview process and
collection of background information, we feel that the most prudent course of action is to proceed with
a ‘cloud’ deployment method (Option 2 or Option 3) for the following reasons:
1. Upfront Costs: There are less up-front costs associated with cloud systems since little
infrastructure is needed.
2. Upgrades: Your system will always be compatible with upgrades, and in some cases the
upgrades are included in the software license fees. Upgrades are handled by the vendor and
require less effort than traditional on premise upgrades.
3. Ongoing support: Less FTE’s are required to maintain the system. Staff can be shifted from
maintaining the hardware and software to other value added activities.
4. Security: Most ‘cloud’ providers offer data security standards that exceed many local government
practices, including redundant data centers and regular data back-ups.
5. Processes: Most City processes are not unique, so functionality available in Public Cloud/SaaS
solutions could be sufficient.
6. Scalability: Scaling up the system is easy as the City grows and the system requires additional
users and data storage.
7. Upgrade Frequency: Continual access to updates will reduce the chance of the system
becoming obsolete.
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2. Current Systems Assessment
2.1 SWOT ANALYSIS
The following is a high-level analysis of the key strengths, weaknesses, opportunities, and threats based
on the City’s current systems, business processes, staffing resources, and system replacement project.
Strengths Weaknesses
1. City staff have created significant workarounds
to address user reporting needs
2. Pent up demand: users crave system changes
to improve their work processes
3. City management and staff are receptive to
embracing best practices and willing to re-
examine business processes
4. City commitment to engaging stakeholders in
change process
5. Recently hired City staff have experience using
newer ERP systems
6. City-wide desire to reduce paper-based
processes whenever possible
7. City has gained recent system implementation
experience and lessons learned through several
recent projects (i.e. Infor EAM system
implementation)
8. City systems are currently supported by their
vendors
1. Limited tools to develop reports for access to critical
information
2. Lack of integration between Incode and other City
systems
3. Significant side systems exist to assist with departmental
tracking of data in multiple functional areas due to the
limitations of the current system (i.e. Excel spreadsheets
4. Several staff expressed frustration due to limited access
to real-time data (i.e. updated budgets)
5. Limited ongoing training available. As a result, new staff
members may not be receiving enough training to fully
utilize existing systems.
6. The system is not user-friendly and makes processes
less efficient.
7. Existing modules in Incode are not fully utilized
8. Limited human resource management functionality
available or utilized in Incode
Opportunities Threats
1. Replace current system with a fully integrated
suite of applications/modules (ERP) that better
meets the City’s needs
2. Utilize the new ERP system for human capital
management and other paper-based and manual
processes
3. Review and improve business processes and
align with government best practices
4. Expand reporting and provide dashboard
capabilities for end-users
5. Increase automation and workflow capabilities
6. Improved integration with other City systems
7. Provide training to City staff on new system and
processes
8. Increase internal controls
9. Access data in real time to support financial
decisions
10. Explore system deployment models that best
meets the needs of the City
1. Managing City staff expectations that a new system will
solve all issues – will require process redesign,
procedure & policy changes and changes to roles and
responsibilities
2. Managing expectations - balancing robust data tracking
capabilities vs. simple interface
3. Managing staff expectations that future system may not
provide all requested features
4. Difficulty in enforcing new policies and managing change
5. Retro-fitting old processes in the new system
6. Inherent complexity with data conversion and integration
7. Need for significant staffing dedicated to the
implementation process
8. Process improvements depend upon users with little
experience using modern systems
9. Managing change required when moving from paper-
based processes to electronic processes
10. Possible need for ongoing IT and functional system
support staffing
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2.2 KEY ISSUES AND OPPORTUNITIES
One of the primary reasons for selecting and implementing a new ERP system is to improve the efficiency
and effectiveness with which business processes are executed at the City. This includes the ability to
more easily access and report on information in order to make informed decisions.
Through a series of interview sessions with City departments and staff, key issues and opportunities with
existing processes and supporting systems were identified. All of the decisions will impact one or more of
the following:
• People
• Policy
• Process
• Technology
Each of the issues and opportunities defined in the following sections has a decision timeframe
associated with it as follows:
• Immediate: This item can be addressed immediately but is not necessarily required for
implementation
• Selection: Prior to final vendor selection
• Implementation: During implementation of the selected solution
These issues and opportunities should not be viewed as a comprehensive list of all issues that were
defined during the needs assessment phase of the project as the current environment has a significant
number of issues related to functionality, integration, and process challenges inherent within the existing
sys tem’s infrastructure. Likewise, the decisions highlighted below should not be viewed as a
comprehensive list of all decisions that will need to be made during the course of the project as there will
be a large number of specific process-related decisions within each functional area that will be reviewed
and assessed during the implementation phase of the project.
The issues, opportunities, and decisions highlighted in the table below are those that were noted during
the interview sessions as one of a significant nature that will likely require discussion among the City
management team.
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# Process Area Issue Opportunity / Recommendation Category Timing
1. Accounts Payable There is no electronic workflow for invoice
approval.
Modern ERP systems have electronic workflow
capabilities and can be configured so invoices are
sent to the proper approvers based on the City’s
policies.
Technology Implementation
2. Accounts Payable Purchase order information is not
automatically populated in the system
when creating an invoice.
Modern ERP systems allow purchase order data
to be automatically populated over to the invoice
which saves time when creating an invoice and
eliminate errors from data entry.
Technology Implementation
3. Accounts Payable Departments can’t view up to date invoice
payment information in Incode, requiring
them to maintain their own spreadsheets to
track how much has been spent.
Invoices should be entered when they are
received with payment terms so that the system is
up to date.
Modern ERP systems have better reporting
capabilities so that departments can run reports to
view invoice payment information. Departments
should have access to this information in the new
system as well.
Technology Implementation
4. Accounts Payable Limited vendors are set up to accept ACH
payments from the City increasing payment
processing time.
Modern ERP systems allow vendors that accept
ACH payments to be flagged. Enforce a process
that all vendors who accept ACH payments must
be paid in this form.
Process /
Technology
Immediate /
Implementation
5. Accounts Payable There is no control or vendor validation in
Incode that prevents duplicate vendors to
be created in the system. Therefore,
multiple records exist for the same vendors
and un-used vendor records are active in
Incode. Additionally, naming conventions in
Incode are not flexible in search results (i.e.
user could search "XYZ Secure," but find
nothing if it was entered into the system as
"X.Y.Z. Secure," and therefore create a
new vendor file anyway.
New ERP systems have better controls for finding
duplicate vendors as the information is entered,
which will reduce multiple vendor records being
created in the future.
When migrating data from the old system to the
new system, decide which vendor records you
need to keep. Eliminating duplicate vendors and
vendors that are no longer used will reduce cases
of the wrong vendor being selected in the system
and reduce the amount of data that needs to be
converted for the new system.
Process /
Technology
Implementation
6. Accounts Payable There is currently no automated 2-way
matching process between purchase order
and invoice done in the system.
Additionally, there is no 3-way matching
process between purchase order, invoice,
and receipt in or outside of the system.
3-way matching is a best practice and should be
implemented as a control, so the City knows it is
receiving what they intended to purchase at the
right price.
This can be done in the new system and/or with
an interface between Infor and a new ERP
system.
Process
/Technology
Immediate /
Implementation
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# Process Area Issue Opportunity / Recommendation Category Timing
7. Accounts Payable The AP check distribution process is
manual/paper-based.
Modern ERP AP modules will save an image of
checks that will allow the process to be automated
and eliminate the need for saving the paper stubs.
Technology Implementation
8. Accounts Payable Staff are able to charge against a PO that
has no remaining balance in the system.
The City should require purchase orders with no
remaining balance to be closed, and create a
formal policy to enforce this.
Modern ERP systems have the ability to prohibit
charges against a PO with no remaining balance.
Process /
Technology
Immediate /
Implementation
9. Accounts Payable Requests for pre-payment of travel
expenses more than 60 days in advance
must be manually entered into the expense
report.
Modern ERP systems can be configured to accept
travel expense pre-payments from a date range
identified by the City.
Technology Implementation
10. Accounts Payable SutiSoft does not have an interface with
Incode making it difficult to upload
expenses from SutiSoft to Incode and
SutiSoft is unable to check if the correct
G/L is assigned to the request. Credit Card
purchases are not encumbered at the time
of purchase
Creating a true interface between an ERP AP
module and SutiSoft will allow for better controls.
An interface should allow for the G/L code to be
checked at the time of submission and easier
transfer of data between SutiSoft and AP. This will
also allow the new ERP system to encumber the
money at the time of purchase. Alternatively, the
City can replace Sutisoft with the ERP system as
this functionality is standard in the AP module.
Technology Selection /
Implementation
11. Accounts
Receivable
Each fund has their own customer set in
Incode and a customer can exist in a set
for each type of receivable causing some
customers to receive multiple invoices (i.e.
separate invoices for each type of
receivable).
The City should use one set of customers for all
funds so that customers will receive one
statement and can send one payment.
Modern ERP systems would then be able to
allocate the money received to the correct funds
based on the invoice generated. This will reduce
the number of payments AR receives.
Technology Implementation
12. Accounts
Receivable
Finance is required to manually separate
cash from credit card payments collected
by departments due to limitations in Incode.
Modern ERP systems can be set up to
automatically account for both cash and credit
card payments separately eliminating the need for
manually separating payments.
Technology Implementation
13. Accounts
Receivable
The City currently does not have the ability
to create recurring invoices.
Modern ERP systems have the capability to
create recurring invoices. This will save time for
the finance staff.
Technology Implementation
14. Accounts
Receivable
There is no City-wide customer master fee
schedule resulting in multiple departments
maintaining and tracking fee schedules
within their own departments. Maintaining
multiple decentralized fee schedules can
lead to customers being charged different
fees for the same purchase and
Since some fees are legally required to be a
certain amount or within a certain range, keeping
a master list of fees will help ensure compliance.
Once the list is created, manage the master fee
schedule in the new system to allow department’s
access to it when needed and have a policy
instructing all departments to notify accounts
receivable when their fees change.
Process /
Technology
Immediate /
Implementation
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maintaining different schedule will become
more difficult as the City grows.
15. Accounts
Receivable
Bad debt is not currently tracked in a
system but instead an excel spreadsheet.
New ERP systems can run reports showing
invoices that have been unpaid for a certain
amount of time. They can then set up notifications
based on the invoice to notify the correct
department.
Technology Implementation
16. Budget The budget process is completed outside
of Incode and input into Incode at the end
of the process. This means year to date
data is not updated once the budget
process starts. This makes it more difficult
to prepare the budget.
Modern ERP systems have more robust
forecasting and budgeting capabilities to automate
the process from end to end. This will allow the
City to complete their budget activities in the new
system. The City should consider budget
functionality available in each ERP system during
selection to meet the City’s requirements.
Process /
Technology
Selection /
Implementation
17. Budget Position control is currently maintained by
the budget staff outside of Incode.
HR typically maintains the position control
process. A new ERP system with an HR module
will manage position control. This will make
budgeting based on positions easier, as well as
allow management to see how many employees
are working and at what pay-grade.
People /
Technology
Immediate/
Implementation
18. Budget The current system allows Inter-fund
transfers to process that do not balance.
Modern ERP systems have the capability to only
allow processing of inter-fund transfers that
balance in both accounts.
Technology Implementation
19. Budget Departments cannot prepare for the
following budget year in advance, because
they do not know their updated budget until
after the year has begun. This is mainly
due to the cumbersome budget process on
the backend. Therefore, many departments
maintain their own budget tracking
spreadsheets outside of the system.
A modern ERP budget module will allow for
automation within the budget process, real-time
budget information accessible by departments,
and easier reporting on budget vs actuals. If
departments’ revenues and expenses are tracked
in the new system, directly or through an
interface, departments will not need to maintain
their own budget tracking spreadsheets.
Technology Implementation
20. Budget Currently, the City has a one year budget
approval process making it impossible to
budget for multi-year capital projects
Modern ERP systems will have the capability to
have multi-year budgeting. This would be useful
for capital project budgeting, and make project
accounting easier.
Policy /
Process /
Technology
Immediate/
Implementation
21. Cash Receipting Only Finance manages centralized cash
receipting in Incode. Departments each
have their own cash receipting process and
system which does not interface with
Incode. Therefore, departments are
required to manually input cash collections
into Incode which can be a cumbersome
process because the system is not user
New ERP systems are easier to interface with 3rd
party cash collection systems. Creating interfaces
between the 3rd party systems and the ERP will
eliminate manual entry, and eliminate the process
of manually separating cash from credit card
payments.
Technology Selection /
Implementation
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# Process Area Issue Opportunity / Recommendation Category Timing
friendly. Additionally, departments have to
manually reconcile cash collections from
multiple sources of data and systems with
Incode because data is reflected differently
in each system.
22. Contract
Management
Financial data related to contracts is not
tracked. Departments use purchase orders
to identify when the contract will expire.
Modern ERP systems can link a contract to
purchase orders which will allow for contract
balances to be tracked. A contract management
module allows automatic notifications to be set up
for contract expiration dates.
Technology Implementation
23. Contract
Management
Tracking expenses related to the contract
is difficult and in some cases is not done at
all.
Modern ERP systems allow for tracking of
invoices related to each contract as well as
contract milestones.
Technology Implementation
24. Contract
Management
There is no link between the contract and
related requisitions, PO, and invoices in the
system.
Modern ERP systems can link between each of
these documents, and allow drill-down capability
to make navigating between them easy.
Technology Implementation
25. Contract
Management
Contracts are not centrally stored or
managed due to limitations in InCode. Staff
are implementing a manual system to
centralize contracts in the City Secretary's
Office and Laserfiche.
Storing all contracts in one place will make it
easier to find information when it is needed and
create one source of truth. Modern ERP systems
allow for storing and tracking contracts centrally
but still accessible by all departments.
Technology Implementation
26. Fixed Assets Information in Infor is incomplete when it is
transferred to Incode. For example, a CIP
account will only have the total dollar
amount in Incode, not the amount of each
individual asset within the CIP account.
A true interface between the new ERP system
and Infor is necessary to take advantage of the
functionality offered by Infor. This interface will
make data consistent across the systems and
eliminate the need for dual manual data entry.
Technology Implementation
27. Fixed Assets Historically IT fixed assets were not
tracked, so there are items not accounted
for in the current system.
IT fixed assets that are not in Incode should be
added to the current system for data migration to
the new system or directly into the new system
Process Immediate /
Implementation
28. Fixed Assets Labor costs are not being capitalized. Modern ERP time and attendance and project
accounting modules have the capability to
associate time entries with a specific project to
allow for capitalizing labor costs.
Process/
Technology
Selection /
Implementation
29. Fixed Assets Purchases are not marked as fixed assets
at the time of purchase. Therefore, invoices
are manually reviewed to see if they qualify
as fixed assets and journal entries
recording fixed assets only happen at the
end of the year.
If purchases are designated as fixed assets at the
time of purchase, they will automatically be placed
in the fixed asset list, with associated journal
entries, when the item is received.
Rules can be created in the system to
automatically classify purchases above a
threshold as fixed assets.
Process/
Technology
Immediate
/Implementation
30. Fixed Assets Fixed assets are not physically tagged. Currently, only the invoice is stamped with a fixed
asset tag number. The City should consider
tagging the actual asset with its fixed asset
Process /
Technology
Immediate /
Implementation
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number. This will make tracking inventory of fixed
assets easier in the system.
31. Fixed Assets The City does not have a way to depreciate
and value assets resulting in significant
write downs to their fixed assets accounts.
New ERP systems have project accounting and
fixed asset modules to accurately manage assets
and their values.
Technology Implementation
32. General &
Technical
Many processes within the City are not
standardized or centralized. Additionally,
many current processes are not
documented, followed, or enforced. not
documented, followed, or enforced.
Comprehensive documentation should be created
on how to complete processes once the new
system has been implemented. In addition, some
work should be done immediately to document
processes or train back-ups. Without either of
these, the City risks not being able to complete
necessary activities should a key employee leave.
Process Immediate
33. General &
Technical
It is difficult to search in Incode (i.e. on a
specific field or data set).
Modern ERP systems have enhanced search
capabilities, including the ability to search on most
fields and/or data.
Technology Implementation
34. General &
Technical
Workflow with automated notification and
electronic approvals are either not available
in Incode or not widely used due to other
limitations of the system.
New ERP systems have the ability to create
workflows for different processes. These
workflows can define which role must approve
something based on City defined criteria. This will
increase efficiency by lowering the time between a
request and final approval.
Technology Implementation
35. General &
Technical
Data is stored in many different systems
throughout the city, and in many cases, this
data is not shared with other departments
or systems.
Many processes can be more efficient and
accurate if interfaces are made between key
systems and the new ERP system. However,
each interface adds more complexity and
potentially more costs. The City must balance
these costs and added complexity with the
benefits provided by an interface. This should be
a factor in the selection process.
Processes /
Technology
Implementation
36. General &
Technical
There is no vendor self-service functionality
limiting automation of several processes.
Vendor self-service allows vendors to update their
own information which save the time for the
finance staff. Vendor self-service could also be
used to allow electronic bid submission, and allow
vendors to see their purchase orders and
invoices.
Technology Implementation
37. General &
Technical
Incode does not have the capability to
attach documents to records in the system.
Some City departments utilize Laserfiche
for document management but this is not
interfaced with Incode.
Standard functionality in modern ERP systems
allow documents to be attached to a record in the
system (for example, an image of the check
attached to an invoice paid). The City should
assess their document management needs (i.e.
what is being done in Laserfiche) and make a
decision to replace this system with an ERP
Process /
Technology
Selection
Implementation
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# Process Area Issue Opportunity / Recommendation Category Timing
document management system or interface
Laserfiche with the new ERP system.
38. General Ledger There is little consistency across G/L
codes. An object code can have different
meanings depending on the department.
Department codes do not always represent
actual departments.
The City should consider recreating the chart of
accounts to a more consistent and standardized
format. This will make finding information and
generating reports easier. It will also make
verifying that the correct G/L account was used
easier.
Process Immediate
39. General Ledger Due to limitations in how the chart of
accounts are set up, departments are
requesting the set-up of additional G/L
codes in the system as a work around to
have the ability to better track their
receivables, payables, budgeting, etc. This
has resulted in the creation of too many
G/L codes set up in the system which can
be difficult to manage.
Explore options to re-design the chart of accounts
to better meet the City’s requirements as part of a
new ERP implementation. Limit the creation of
G/L codes to only ones that are absolutely
necessary. With a new system with better
reporting and budget tracking capabilities, the
perceived need for new G/L codes should
decrease.
Process Immediate
40. General Ledger There are not enough internal controls
related to the General Ledger i.e. depts.
people charge G/L accounts that aren’t
their own, expense accounts are charged
instead of revenue accounts and vice
versa.
Have positions/roles tracked in the system, then
set up controls based on the role a user has. This
will prevent users from accessing parts of the
system or G/L that they should not have access
to.
Process /
Technology
Immediate /
Implementation
41. General Ledger Due to limitations in how the chart of
accounts are set up, money from multiple
funds will roll into one G/L code which
makes balancing the funds difficult.
Don’t allow expenses/revenue related to multiple
funds be tracked in a single G/L account.
Process Immediate
42. Grant Accounting Grants aren’t managed in Incode. A G/L
account is created in the system but there
is nothing currently being done to track the
Grant.
Utilizing a grant management module will allow for
tracking of grant financial data including
reimbursements. This will make it easier to know
when the grant money has been exhausted. This
will also simplify the chart of accounts and reduce
the number of inactive accounts.
Technology Implementation
43. Human Resources Performance management activities are
manual (i.e. done in Excel spreadsheets)
Modern HR modules of ERP systems have
performance management capability. This can
include mid-year and annual reviews, as well as
one-time performance evaluations.
Technology Implementation
44. Human Resources Position control functionality is not sufficient
in Incode resulting in manual and timely
processes.
Modern HR modules of ERP systems have
position control functionality. An employee can be
entered at the time of hire and given a position in
the system. This makes managing position control
and tracking employees easier and the
People /
Process /
Technology
Implementation
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information can be shared with the budget
module.
45. Payroll There is no link/integration between
benefits enrollment data and payroll.
Modern HR modules of ERP systems have the
ability to track benefit information and can share
information with other modules, including payroll.
Technology Implementation
46. Payroll Multiple payroll periods cannot be open at
the same time. Because of this they must
have 6-7 payroll runs just for the month of
December due to the awards and bonuses
paid.
Modern ERP systems all prior payrolls to be
opened and updated if desired. Additionally,
awards and bonuses can be entered in the normal
pay roll run eliminating the need for additional
payrolls to do this at the end of years.
Technology Implementation
47. Payroll Payroll is unable to perform mass pay rate
updates in Incode due to limitations of
functionality in the system (i.e. only the
entire City can be updated by the same
amount) requiring manual and time
consuming updates.
With proper positions maintained in the system,
new ERP systems can make this process faster
and allow for mass rate changes by department or
other category.
Technology Implementation
48. Payroll HR cannot run reports to find the following
information: part-time employee hours to
make sure they don’t go over 1000 for the
year, injury leave for workman’s
compensation, years of service for
retirement purposes, resulting in the need
to track in excel spreadsheets.
New ERP HR modules will have more flexible
reporting capabilities, and regular users should be
able to customize reports to find information they
need. More complex reports can be created
during implementation.
Technology Implementation
49. Payroll Payroll staff are required to manually track
and notify employees of when they will lose
accrued leave due to limitations in Incode.
Modern ERP systems typically provide
configurable functionality that can send
notifications based on specific parameters. (i.e.
send a notification if an employee is at risk of
losing accrued leave time). This type of
functionality may be able to save hours of work
per year by the admin techs who have taken it
upon themselves to help their team.
Technology Implementation
50. Payroll There is no direct integration of the HR
module or data to payroll in Incode.
Creating an interface between HR and payroll, or
having both modules as part of the same ERP
system, will eliminate dual entry and
reconciliations. Payroll should have access to
position control, which makes tracking which
employees should be submitting time easier.
Technology Implementation
51. Payroll Incode is limited to 7 leave codes and 3 are
hard-coded and cannot be changed.
Therefore, leave is tracked separately
because one code in the system can mean
multiple things.
Modern ERP payroll modules allow for creation of
more leave codes. A new system will also
enhance reporting capabilities, including tracking
part-time employee hours.
Technology Implementation
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# Process Area Issue Opportunity / Recommendation Category Timing
52. Project Accounting Project invoices are paid from an
unintended funding source. For example, if
a project is funded by a Grant and
operating funds, an invoice may be paid
from the grant before the operating funds.
Modern ERP systems commonly have the ability
to designate multiple funding sources for a
project, and have the system calculate how much
money to take from each source.
Technology Implementation
53. Project Accounting Project accounting is not truly used in the
system resulting in the need for
departments to manually track their project
budgets.
Utilizing modern an ERP project accounting
module will allow departments to have more
accurate information. This will allow them to track
their budget and project status. This should
reduce the number of times projects go over
budget.
Technology Implementation
54. Project Accounting Multi-year projects require workarounds to
manage. Departments can either roll-over
the PO, which requires another budget
approval, or keep the PO open from the
previous year but this will negatively impact
the accounting ratios.
If possible, change the budget process/policy to
allow for City-wide multi-year budgeting and
approvals to eliminate issues and/or workarounds
in the system to handle multi-year budget items
i.e. capital projects. Multi-year projects are
available in new ERP systems and allow
automatic rollovers.
Policy /
Technology
Immediate /
Implementation
55. Project Accounting One purchase order is used for a vendor
that works on multiple projects. This makes
tracking individual project status and
budget difficult.
Use project codes in the new ERP system to link
expenses to a project which will allow the project
status and budget to be tracked easily within a
new ERP project accounting module.
Technology Implementation
56. Project Accounting Separate purchase orders are created for
the engineering and construction vendors.
There is no link between the two for project
tracking purposes.
Utilize project codes to link expenses to a project
in the new system.
Technology Implementation
57.
Purchasing Purchase orders are sometimes created
after the actual purchase occurs. This
eliminates internal controls because
approvals are skipped and increases the
risk that something is purchased when they
don’t have the budget to make the
purchase.
Enforce policies regarding creation of purchase
orders before purchases are made to utilize
workflow approval to increase internal controls.
New ERP systems have workflow for approvals
and budget controls that won’t allow a PO to be
processes if it causes the fund to go over budget.
Policy /
Process
Immediate /
Implementation
58. Purchasing Bids are not accepted electronically. Accepting electronic bids will make entering the
data for evaluation into the system much easier. If
policy does not allow electronic submissions,
consider changing the policy.
Policy Immediate
59. Purchasing City may be missing the opportunity to
receive volume discounts due to extensive
use of P-Cards.
The City should try to negotiate discounts with
vendors based on the total volume of purchases.
It may be possible to get a volume discount once
they reach a certain threshold. Limiting the
number of p-card purchases can help manage this
process.
Process Immediate
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# Process Area Issue Opportunity / Recommendation Category Timing
60. Purchasing
Purchase orders are created by finance,
not the department making the purchase.
Departments should be able to create their own
purchase orders.
New ERP systems have workflow capability to
allow necessary approvals once the purchase
order process is initiated. The workflow can be set
up with multiple thresholds that determine the
level of approvals needed for purchase orders.
Process /
Technology
Immediate /
Implementation
61. Purchasing Change orders do not update information in
Incode. If the quantity of items they plan to
receive changes, there is no way to change
the PO or keep track of the change in the
system. Similarly, when the unit price
changes there is no way to update this in
the system.
New ERP systems have the ability to change
purchase information once the proper approvals
have been obtained through electronic workflow.
Technology Implementation
62. Purchasing
Commodity codes are not used when
making purchases.
Use of NIGP commodity codes in the new ERP
system will make reporting and tracking expenses
easier.
Technology Implementation
63. Purchasing
Receipt of purchases are not entered in
Incode.
There should be a 3-way match between the
purchase order, invoice, and receipt of
goods/service. This will ensure that the correct
goods and services are received for the right
price. An interface between Infor and Incode will
allow for easier receipting.
Technology Implementation
64. Purchasing
Blanket purchase orders are not used in
Incode and it is not possible to create an
unencumbered purchase order
Using unencumbered purchase orders will allow a
purchase order to be made based on a contract.
This will make it easier to track expenses by
contract. Most ERP systems have a way to create
unencumbered purchase orders.
Technology Implementation
65. Purchasing
Infor doesn’t interface with Incode, creating
the following issues:
• Year-end roll over of POs involves
checking Infor and Incode to
reconcile any differences.
• Assets are not capitalized in Infor.
• Project numbers are created in
Incode and manually input in Infor.
• Disbursement report is created in
Infor and manually delivered to
finance.
• Finance must manually enter the
journal entries.
Modern ERP systems have the capability of
creating unencumbered purchase orders. This will
allow the City to create purchase agreements with
vendors without inaccurately affecting budgets
until the invoices are received.
Additionally, Creating an interface between Infor
and a new ERP system will eliminate most dual
entry and manual reconciliation involved in the
purchasing process. It will also allow the
requisition to be linked to the purchase order and
the invoice, and allow an item to be marked as a
capital asset at the time of purchase.
Technology Implementation
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# Process Area Issue Opportunity / Recommendation Category Timing
• PO number in Infor is handwritten
on the Incode PO.
66. Reporting Due to lack of real-time data available in
the system, financial reports requested by
departments are not accurate or current
requiring tracking of data outside of the
system completely.
A new ERP system will have improved reporting
capabilities, including the ability for users to
customize reports without SQL knowledge. More
complex custom reports can also be created
during implementation.
Users should have access to reporting tools, so
they can run their own reports at any time.
Modern ERP systems have the ability for users to
generate reports at any time without needing
knowledge of SQL or other technical knowledge.
Technology Implementation
67. Reporting Incode does not have accurate data to
build the CAFR (manual reconciliations
have to be performed out of the system to
get accurate data) and limitations in
running the reports needed to build the
CAFR. Therefore, the process to create the
CAFR is cumbersome requiring the City to
hire a 3rd party contractor to complete.
Modern ERP systems with enhanced reporting
and data accuracy will help cut down on the
CAFR process. Also, systems are available that
can automate most of the CAFR process, either
as part of an ERP solution or a standalone
solution. The City should evaluate ERP CAFR
functionality and consider a best of breed solution
if the ERP system will not meet their needs. The
City must also ensure that their staff have enough
time to complete the CAFR process before they
take ownership back from the auditors.
People /
Technology
Selection /
Implementation
68. Reporting Running reports from Incode is in many
cases manual and time consuming.
Modern ERP systems have more flexible reporting
capability. They allow users to create reports on-
demand, with some degree of customization
possible without requiring technical knowledge.
Technology Implementation
69. Staffing & Training Several departments are understaffed
and/or do not currently have resources to
manage key business processes. For
example, there are obvious staffing needs
in HR, Accounting, Budget, Purchasing,
Treasury, etc.
Assess the resources needs of the City, and hire
accordingly (i.e. HR, Accounting, Budget,
Purchasing, Treasury, etc.)
People Immediate
70. Staffing & Training It was reported by City staff that the
organizational chart structure (i.e. hierarchy
of departments and divisions) and frequent
re-organizations within the City cause
confusion
The City should review the current organizational
structure/hierarchy to eliminate confusion and
reduce the frequency of re-organizations.
People /
Process
Immediate
71. Staffing & Training Roles and responsibilities across City
departments and staff are often unclear.
The City should standardize and document clear
roles and responsibilities across City departments
and staff and incorporate in onboarding trainings.
People /
Process
Immediate
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# Process Area Issue Opportunity / Recommendation Category Timing
72. Staffing & Training There is lack of training on City systems
and business processes for current and
new employees.
Implementing a new system will allow the City to
develop training materials and resources for City
staff. The City should have trainings during
onboarding as well as available throughout the
year. Training materials should be kept current
and easily accessible for City staff.
People /
Process
Immediate /
Implementation
73. Staffing & Training Departments often rely on Finance to print
reports from Incode due to lack of training
and difficult usability of reporting functions
in the system (i.e. depts. may not know the
correct codes or date ranges)
Newer ERP systems have more user-friendly,
intuitive, flexible, and robust reporting capabilities
making it easier for all end users to be trained on
running reports on their own. The City should also
provide live training and system
documents/manuals for system users to reference
as needed.
Process /
Technology
Implementation
74. Time & Attendance Fire and Police time entry is complex (i.e.
due to scheduling and overtime) and time
consuming because the current T&A
system does not handle their unique
requirements.
The city should evaluate time & attendance
applications and pick one that is flexible enough to
handle the needs of disparate departments
(including mobile entry of time). A more robust
time and attendance system will reduce time
spent entering time and allow for easier reporting.
Technology Selection/
Implementation
75. Time & Attendance It is difficult to validate if all employees
have entered their time for payroll
processing. Payroll must run a report and
review for missing employees to identify if
they have not entered their time and then
email the employee to confirm the reason
as to why they didn’t enter time.
Modern ERP systems have better reporting
generating capabilities that allow you to select,
filter, and query information desired (i.e. missing
time entry) Additionally, many modern ERP
systems allow you to set up reoccurring reports
that are sent automatically at a frequency
designated by the user (i.e. monthly)
Technology Selection/
Implementation
76. Time & Attendance Many departments (police, fire, etc.) need
to enter their time in decimal increments,
however, this is not possible in the current
T&A system and must be done directly in
the payroll module. This causes
inconsistency across T&A and payroll data.
Modern ERP systems Time and Attendance
modules allow more flexible time entry.
Technology Selection/
Implementation
77. Time & Attendance Many departments (police, fire, parks and
Recreation) time entry is done outside the
system at multiple sites and requires a
department resource to manually enter
each employee’s time into Incode and
manually reconcile time sheets. This is also
a manual and time-consuming department
head approval process, especially for
larger departments.
Some Time and Attendance systems allow for
mobile time entry. Consider a way for employees
to enter their time on a mobile device (their own or
shared device). This will reduce the time spent by
admins or supervisors entering time for all of their
employees or reconciling multiple timesheets. The
City should also implement a process where all
City staff enter their time directly into the system
(if the system is available to them) to reduce
manual time and entry on the back-end, manual
Process /
Policy /
Technology
Immediate /
Implementation
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# Process Area Issue Opportunity / Recommendation Category Timing
reconciliations, and allow for automated
approvals.
78. Treasury Debt is not tracked in Incode. It is an
extremely manual process handled in Excel
and there is opportunity for errors to occur.
A debt management module will make it easier to
track debt and reduce errors. Additionally, more
accurate tracking of debt will help with cash flow
forecasting.
Technology Implementation
79. Treasury The City does not currently have enterprise
systems or resources to comprehensively
track debt and investments internally.
Due to the millions of dollars of debt to track, the
City should consider hiring someone that is solely
responsible for treasury activities. As the City
grows this job will become more demanding.
Additionally, the City should investigate debt and
investment management modules / capabilities in
modern ERP systems during system selection.
People /
Process /
Technology
Immediate /
Selection /
Implementation
80. Treasury Calculating sales tax is done manually and
requires reconciliations mainly because
Finance must assess whether sales tax
was included in a total line item or broken
out.
Modern ERP systems all for sales tax to be
broken out as a separate line item to easily
identify and report on. The City should require
departments to create a separate tax line (if
required) in the system as part of their process.
Process /
Technology
Immediate /
Implementation
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2.3 APPLICATION INVENTORY AND PRELIMINARY MIGRATION PLAN
A partial list of the City applications identified through the ERP Needs Assessment process has been
assembled, organized by functional area and is presented below:
* Legend: Preliminary System Migration Plan
Replacement (R): The City is intending on replacing this application.
Consider (C): The City is considering replacing this application with an ERP solution, based
on the strength of the finalist vendor offering and cost / benefit of the
replacement module.
Maintain (M): The City is intending on retaining the application, not replacing it.
Interface (I): The City is intending on keeping the application and interfacing/integrating it
with the selected ERP solution.
** Legend: ERP Availability
Generally Available
(G):
The module is generally available from most / many providers of ERP
solutions to similar size entities
Best of Breed (B): The module is not generally available from most / many providers of ERP
solutions to similar size entities and is typically selected and implemented
as a separate best of breed system, then later integrated to ERP, as
feasible, based on available funding and skills.
Expanded ERP (E): The module is available from certain, select providers of ERP solutions to
similar size entities and if not selected and implemented as part of the
integrated ERP system, would need to be retained and / or obtained by
the City from a separate best of breed system, then later integrated to
ERP, as feasible, based on available funding and skills.
The City’s application inventory and preliminary migration plan contained in the table below should be
leveraged into the Request for Proposal (RFP) development and system selection processes. As part of
the RFP development process, the City management team should review this preliminary plan and
update it accordingly. Through this, in addition to the numerous business and technical requirements and
other required RFP components, the City should ensure that its intent toward considering implementation
is adequately described and include its migration plan in the RFP. This will provide further insight to
potentially interested vendors on the City’s current environment and plans to transition to a future ERP
solution. Additionally, as part of the RFP development and system selection process, we will assist the
City in creating a table that lists future interfaces to the new ERP system including their source application
and data feed.
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2.4 APPLICATION INVENTORY
Current Application Application Notes/Description Departmental Owner
Preliminary
Migration
Plan*
ERP
Availability**
Expected ERP
Module
1099 Pro ACA IRS reporting 1095c HR M N/A N/A
ACR System Work orders and service requests Engineering Support M/I E Work Orders
Active Directory System single sign on Multiple M N/A N/A
Apollo Library management system Library M B N/A
ArcMap, ArcGIS,
ArcGIS Online
GIS desktop software, GIS server software,
GIS web mapping platform geocoding /
graphic representation of agreements, city
assets, projects, etc.
Development Services M/I B N/A
Authorize.net/Evalon Online and credit card meter to cash
payments. Will terminate after Dec. 2017
CIS Go-Live
GUS M B N/A
AVFuel Airport credit card payments Airport C G Cash Receipting
Avigilon Security camera system Facilities M N/A N/A
Benetrac 3rd party online benefits enrollment HR I/C B N/A
Bosch ESI Truck Truck diagnostic software Fleet M N/A N/A
Brazos Tickets and warrants Municipal Court M B N/A
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Current Application Application Notes/Description Departmental Owner
Preliminary
Migration
Plan*
ERP
Availability**
Expected ERP
Module
Cartegraph Pavement management information system Technical Services &
Engineering Support
M B N/A
Centra Vu MDM Portal GUS M N/A N/A
Chameleon Animal adoption services Customer Care M N/A N/A
Checkfree, Metavante,
Princeton
3rd party online payment processing (meter
to cash)
Customer Care M N/A N/A
Cisco CIS pop up screens via phone system,
Customer Interactive Voice Response
System, Automatic Call Distribution
IT M N/A N/A
Cry Wolf False alarm payments Police M/I G Cash Receipting
Cummins Insight Engine diagnostic software Fleet M N/A N/A
Dataprose 3rd party billing, printing and mailing
provider
Customer Care M N/A N/A
DisSPatch Outage Management System GUS M N/A N/A
DPS Conviction reporting Municipal Court M B N/A
Elster Mobile Meter Data Collection System,
Advanced Metering Infrastructure
GUS M B N/A
Emergicon 3rd party ambulance billing and collection
service
Fire M N/A N/A
ESO EMS reporting, EMS and billing, reporting,
personnel
Fire M N/A N/A
ESRI GIS system, collects premises information
for utility account creation
Engineering Support M/I B N/A
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Current Application Application Notes/Description Departmental Owner
Preliminary
Migration
Plan*
ERP
Availability**
Expected ERP
Module
FireHouse Fire incident reporting, state reporting,
scheduling, personnel, inventory
Fire M B N/A
FME (Desktop and
Server)
Spatial Extract, Transform, Load Software GUS M B N/A
Ford IDS Ford diagnostic software Fleet M N/A N/A
GeoDigital WorkStudio Manage electric utility projects Utility Operations M N/A N/A
Guardian Fire alarm systems Fire M N/A N/A
iFleet Fleet fuel management Fleet M B N/A
Incode Various functions:
General Ledger
Accounts Payable
Accounts Receivable
Budget
Purchasing
Payroll
Cash Receipting (centralized)
Inventory
Fixed Assets
Building Permits
Human Resources
Multiple R G General Ledger
Accounts Payable
Accounts Receivable
Budgeting
Purchasing &
Inventory
Payroll
Cash Receipting
Fixed Assets
Building Permits
Human Capital
Management
Incode Courts billing and payments Municipal Court M/I B Accounts Payable
Incode CIS and Data Warehouse GUS R E N/A
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Current Application Application Notes/Description Departmental Owner
Preliminary
Migration
Plan*
ERP
Availability**
Expected ERP
Module
Infor Enterprise asset management, inventory,
requisition creation, receipting of goods,
fleet work orders
Public Works, Utility
Operations, Engineering
Support / Business Resource
Mgt., Fleet
I/C G Purchasing & Fixed
Assets
Insite Online credit card payments Municipal Court M/C G Cash Receipting
Ionwave Bid management, post-execution contract
management
Purchasing M B N/A
Itron Mobile Meter Data Collection System,
MVRS
GUS M B N/A
John Deere Service
Advisor
Diagnostic software Fleet M N/A N/A
LaserFiche Document management Multiple I/C G Various
Master Link Mobile Mobile Meter Data Collection System GUS M B N/A
Merchant Connect Card payment collections Multiple C G Cash Receipting
Metavante Online payment processing clearinghouse
file import
GUS M B N/A
Microsoft Excel Tracking and reporting on various data (i.e.
inventory, invoice, and budget)
Multiple R G Various
Microsoft Excel Bid and contract tracking Purchasing R G Contract Management
Microsoft Excel Tracking fiscal surety bonds Finance R E Treasury
Management
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Current Application Application Notes/Description Departmental Owner
Preliminary
Migration
Plan*
ERP
Availability**
Expected ERP
Module
Microsoft Exchange Mail server access Multiple M/I N/A N/A
Microsoft Word Correspondence, RFPs & RFQs, contract
documents
Multiple M N/A N/A
Milsoft Outage information for utility accounts,
electric engineering analysis, and electric
distribution mapping
Customer Care/GUS, Water,
Engineering Support
M N/A N/A
Monarch Financial reporting Multiple R G Financial Reporting
Moneris Parks credit card processing Parks and Recreation I/C G Cash Receipting
MyPermitNow Planning, permitting, and inspections Development / Planning and
Inspections
I E Permitting
NeoGov Employee applicant tracking and
onboarding
HR I/C G Human Capital
Management
Novus Agenda City council agendas Multiple M N/A N/A
Operative IQ Inventory, personnel, reporting, asset
management tracking
Fire M G Purchasing, Fixed
Assets
Operator 10 Data management system Development Services M B N/A
OSSI / RMS Police records management system Police M B N/A
OTC Pegasus Automotive diagnostic software Fleet M N/A N/A
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Current Application Application Notes/Description Departmental Owner
Preliminary
Migration
Plan*
ERP
Availability**
Expected ERP
Module
Paymentus Point of sale system Customer Care I/C G Cash Receipting
Perfect Mind Parks and recreation management system Parks and Recreation I B N/A
Playground Guardian Playground management Parks and Recreation M B N/A
Princeton Online payment processing clearinghouse
file import
GUS M N/A N/A
Milsoft IVR Interactive voice response GUS M N/A N/A
Remit Plus Payment file processing, cash letter
creation
Customer Care M B N/A
RTA Fleet Fleet management system Fleet M/I B N/A
SGR / Litmus City training and development materials HR M N/A N/A
SQL Server Data warehousing Multiple I N/A N/A
Square Cash collections Community & Development I/C G Cash Receipting
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Current Application Application Notes/Description Departmental Owner
Preliminary
Migration
Plan*
ERP
Availability**
Expected ERP
Module
Suti-Soft Credit card and travel expenses Multiple R G Accounts Payable
Team Sideline League scheduling Parks and Recreation M B N/A
Total Aviation Fuel and lease billing Airport M/I B N/A
Tyler Content
Management
Document scanning and management Municipal Courts M E Document
Management
Ucentra Meter data management Customer Care M B N/A
Umax (currently
implementing)
CIS, utility payments Utility Operations I E Utility Billing
WaterGEMS Water Engineering Model GUS M N/A N/A
When2Work Scheduling Parks and Recreation M B N/A
Wonderware Supervisory Control and Data Acquisition GUS M N/A N/A
WorkStudio Electric engineering design and project
management
Engineering Support I B N/A
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2.5 CURRENT TECHNOLOGY PROFILE
The City of Georgetown IT department is in charge of 30+ sites where they provide telephone, internet,
intranet, desktop and server access to City data and software that is housed within the primary data
center (GCAT) within the City. Sites are inter-connected in a Hub-Spoke topology via dark fiber, with
speeds ranging from 1GBE up to 10GBE based on the needs of each site. The network infrastructure is
built and maintained by Georgetown IT Staff and protected by Firewalls, Anti-Virus, Anti-Malware, Anti-
Spyware, Content Filtering, and various other network security devices. Email is hosted by the City using
Microsoft Exchange version 2010 SP1.
Telephone services are provided by VOIP hardware that is built and maintained by the IT Staff. Internet
services are provided by multiple carriers and centralized within 2 primary internet connections, and
providing speeds of 50MB (upload and download) speeds and 150MB (upload and download) speeds
respectively for these connections. The City has a secondary connection point to the internet with speeds
of 50MB (upload and download) using microwave technologies.
The data center primarily consists of Cisco Servers running Windows 2008 and 2012. The City currently
has 24 physical servers and 230 virtual servers. These virtual servers have been built to scale when
needed and fail over for disaster recovery means. Microsoft SQL is present (2008 and 2012) in this
environment, with their standard being 2012.
Storage is done on a consolidated network storage system that was built to scale, fail over and replicate
(real-time) for best practice and backup. All systems and software are monitored in real-time with
email/text notifications to IT Staff. Backups are currently performed using both disk to disk and using
storage servers with replication to alternate physical location.
In addition to data center services the IT Department also utilizes cloud services in the form of Software
as a Service (SaaS) where needed.
The City IT Staff manage 600 workstations located throughout the City and are primarily Dell
workstations. All workstations/thin clients range in age from 3-5 years. These workstations are imaged,
managed, and updated using automation tools, or manual engagement. The City utilizes Microsoft
Internet Explorer, Firefox, and Google Chrome as browsers as required for applications.
2.6 TECHNOLOGY ASSESSMENT FINDINGS & ERP READINESS
An assessment of the City technology infrastructure was performed for three primary purposes:
• Identify its ability to support a new ERP system on premise environment
• Identify its ability to support a new ERP system in an off premise (i.e., vendor hosted)
environment.
• Identify technology related requirements and standards for a new ERP system to operate
effectively in the City’s technology environment
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In summary, we found City technology to be in a good state of readiness for the implementation of a new
ERP solution. In Table 2 below, we present an overview of our technology findings and readiness at the
City. T o facilitate your review, we have included the following dashboard indicators in the assessment:
Critical Finding
Warning/Caution Finding
Sufficient Finding
Table 2: Technology Assessment
Topic Description
Data Center The Primary Data Center is located at the Georgetown Communication &
Technology Center. Our research indicates that this facility is NOT located within a
flood zone.
HVAC systems are used for temperature and humidity control. Based on best
practices and available funding, the City should consider redundant HVAC systems
for this critical area.
HVAC system are tied to the generator with dedicated 24x7 cooling.
Access to the data center is restricted via door access control system, Video
cameras monitor entrances.
Halon or inert gas Fire Suppression System protects the data center.
People Accessing Data Center: Trusted with computer-skilled employees.
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Topic Description
Data Network The City contains 30+ sites and all are connected to the network.
The network is a hub and spoke dark fiber network, with speeds ranging from 1GBE
to 10GBE according to the needs of each site.
The users report that the network is very reliable and has few issues. The
availability of the network has a high availability generally > 99.9%.
The Data Network supports Data, VoIP, Apps, Video, and GIS which constitutes a
great utilization of technology and economies of investment.
All Network equipment is covered by Next Business Day Support and network
equipment is Palo Alto or Cisco (industry leaders).
The City should consider a multiple firewall configuration with failover functionality
should the current single firewall fail.
Firewall response service level is currently Next Business Day. The City should
consider moving to Same Day response (or until multiple firewall configuration is in
place).
Very little data Network documentation: The City should consider updating
documentation for network stability, disaster recovery, and staff turnover.
Sufficient Network Capacity.
Data Network Monitoring: Multiple solutions utilized for monitoring.
Internet/Cloud
Connectivity Multiple pathways and providers for accessibility to the internet.
Centralized connectivity to the internet.
City should consider load balancing and failover between the 2 primary connections.
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Topic Description
Server & Network
Administration
Servers are “Enterprise-Class” style servers.
Servers exist on UPS units and generator power. Server hardware contains dual
power supplies with cross connects to diverse UPS sources.
Server Utilization rates for servers are normally between 0 – 10%.
Windows 2008, and Windows 2012 are all used in the environment.
New Servers have maintenance for 3 years and then have extended coverage.
Servers are physically secure and located in an access controlled data center.
Critical Servers are in a cluster or load balanced, with redundancy hardware.
Majority of Servers are virtualized and configured for redundancy and failover.
Consolidated Storage system.
All servers are running the latest service pack excluding the Microsoft Exchange
Server. Consider updating service pack on the exchange server.
City maintains a patch management policy and applied effectively.
Antivirus/Antispyware protection is updated and current on all servers.
Server Documentation not fully developed or complete. Consider updating
documentation for best practices.
Potential additional Servers and Storage will be needed in support of the new ERP
solution and will need to be evaluated during the award process.
Storage & Backup
Environment &
Disaster Recovery
Disk to Disk and storage servers are used with replication to alternate location for
survivability.
There is a verified full backup performed Daily, Weekly and Monthly. Backup
window is primarily less than 6 hours.
Databases are backed up in a live environment.
Consider testing and adoption of using encryption technology on backups.
Automated messages are sent on backup process.
Data is reviewed for sensitivity and appropriately controlled.
Bare Metal Restore is utilized and tested frequently.
Disaster Recovery (DR) Plan: City does not have a plan in place currently but
exploring DRaaS technologies as a potential solution.
Consider the development of a threat assessment matrix to identify the likely
occurrence of threat events. Take actions with a plan starting first with the highest
probability of the threat.
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Topic Description
User Administration
Formal process for creation, deletion, and access of user accounts.
User Accounts are audited on regular basis and defunct accounts removed.
Shared access to services/shares are audited on a regular basis.
2 Factor Authentication is utilized for access. Is only partially deployed within the
organization and should be adopted throughout the organization.
Passwords and password complexity rules are enforced.
Limited number of users having “Administrator” account access.
Applications Browsers: Internet Explorer/Chrome/Fire Fox
Report Writing: Microsoft SQL Reporting Services and IBM Cognos
Staffing System Administration is accomplished by multiple members on the IT Team.
After Hours support is provided (5-9pm).
Administrators are paged/notified based upon automated monitoring of systems.
Staff indicates limited resources for report development. Consider: 1). Adding
funding for a bucket of hours for report development training, or report development
within the vendor contract. 2). Evaluate internal resources for report development in
the future 3). Adding additional staff for report development.
Staff indicates limited resources for database administration. Consider: 1). Adding
additional staff for database administration 2). Discuss with potential vendors if they
offer database administration services.
IT Staff will be taking on additional responsibilities such as configuring workflows,
dashboards, and potentially complex report development.
ERP Conversion resources need to be evaluated for potential solutions to the
current environment and transition to the new ERP solution.
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3. Options Analysis & Recommendation
3.1 ERP SYSTEM DEPLOYMENT OPTIONS
Consistent with project objectives to replace the legacy ERP system, this options analysis assess and
compares the system deployment options currently available in the marketplace to implement a new ERP
system. Ultimately, this analysis and recommendation will assist the City in making a strategic decision for
the ERP system deployment method that best meets the needs of the City. The City has three primary
options in regard to the strategic direction of deploying the new ERP system:
Option 1:
On Premise
The City would procure the hardware and software for a new ERP system and
deploy in the City’s environment on-premise.
Option 2:
Vendor
Hosted
The City would procure the software for a new ERP system and host in the
vendor’s environment off-premise via a ‘private-cloud.’
Option 3:
Public Cloud
(SaaS)
The City would subscribe to and implement an ERP ‘Public Cloud’ solution.
3.2 ERP SYSTEM DEPLOYMENT COMPARISON
Our options propose that the City could proceed in
deploying ERP via one of three ways: traditional on-
premise deployment, off-premise vendor hosted
(private cloud) deployment, and Software-as-a-
Service (public cloud) deployment. It must be noted,
that hybrid approaches exist, but when reviewing the
deployment of a fully integrated ERP solution that
includes core financial, human resources and payroll
functionality there are realistically three deployment
options with a variety of vendor defined pricing
strategies to consider.
Traditionally, the traditional on premise approach was
the preferred strategy for implementing an ERP
solution. As ownership of the software was perpetual
and the development of the solution was unique to the
client, local governments looked favorably on the
overall control they had over the application software
and hardware. However, in recent years, private
cloud implementations have become increasingly
popular. A majority of the traditional software
providers now offer a private cloud hosted alternative, however only a handful are offering public cloud
ERP to the local government marketplace.
Vendor hosted solutions in a ‘private cloud’ also support more customization and are regularly on a single
tenant model. The private cloud deployment approach, can allow for flexibility from an ‘exit strategy’
Private vs. Public Cloud – What’s the
difference?
Both deployment strategies involve
hardware and data residing off-site, so
depending on the definition both may
qualify as being in the cloud. However, this
paper will only refer to solutions as “public
cloud” that meet three criteria:
1) The hardware, software, and data are
located off-site.
2) The software has a common code base
for all customers.
3) The software is sold on a subscription
basis, so access terminates when
payments stop.
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perspective as well as the benefits that are aligned with the hosting vendor taking on much of the back-
office maintenance and support that would be taken on by the client in an on premise model.
Public cloud solutions are less flexible, from an ability to modify the software perspective, but also require
much less maintenance and technical staff to support them. Public cloud SaaS solutions are by definition,
multi-tenant which indicates that numerous customers utilize the same instance of the solution. As a
result, when an upgrade is readily available, every customer will receive the upgrade at the same time.
Regardless, as the City considers various ERP deployment options they need to be cognizant as to what
is being proposed, the robustness of the proposed solution, and the stability of the product.
3.3 ERP SYSTEM DEPLOYMENT COMPARISON MATRIX
On Premise Vendor Hosted –
Private Cloud
Public Cloud - SaaS
Hardware
required
All hardware is paid for and
maintained by the client.
The vendor handles all
aspects and costs related
to hardware.
The vendor handles all aspects
and costs related to hardware.
Customization
options
Extensive configurations and
customizations are available to fit
the client’s unique needs.
Extensive configurations
and customizations are
available to fit the client’s
unique needs.
Little customization options are
available.
Software
Maintenance
All software and data is
maintained by client’s staff.
The hardware and
software reside offsite, but
the client is responsible
for installing updates and
maintaining databases.
The vendor handles
development, patches, etc. and
data is stored in their data
centers.
Upgrade options Upgrades must be bought by the
client, and development may be
necessary to make the upgrade
compatible with the
customizations.
Upgrades must be bought
by the client, and
development may be
necessary to make the
upgrade compatible with
the customizations.
All upgrades are included in the
annual license fee.
Annual Fees Annual maintenance fees are
paid but this is generally a much
smaller amount than a SaaS
subscription, but staff must be
paid to maintain the hardware
and software.
Both annual software
maintenance and
hardware maintenance
fees are paid to the
vendor.
Significant annual fees are
charged in exchange for the
vendor handling the majority of
aspects for keeping the system
running.
License Method Perpetual licensing Perpetual licensing Subscription for use
Exit strategy The client’s data is all on-site and
they are free to do what they
want with it.
Transferring the data from
the vendor’s server will
require planning and may
be imperfect.
Transferring the data from the
vendor’s server will require
planning and may be imperfect.
Disaster
Recovery
Disaster recovery is maintained
by client
Disaster recovery is
maintained by vendor
Disaster recovery is maintained
by vendor.
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3.4 ERP SYSTEM DEPLOYMENT CONSIDERATIONS
Selection Considerations
When evaluating the need for a new ERP system, organizations must consider how many of their
requirements are currently being met. If most of the needs are being met, it’s not necessary to move to a
new system just to ‘move to the cloud.’ Organizations should take an inventory of all systems being
utilized and review where there is any overlap in functionality. In addition, heavy use of shadow systems
indicates that needs are not being met by the current suite of systems. If some of the ‘shadow systems’
are already in the cloud, a strategic move to the cloud for ERP may be advantageous.
Once the decision has been made to replace an ERP system, organizations must decide what
functionality they need in a system. The organization must engage as many stakeholders as possible to
identify gaps in their processes and areas of inefficiencies. These gaps will then be used to determine the
requirements of a new system. All of this information will be used to create a Request for Proposal
document. This explains what the organization requires and vendors will respond with their proposal for a
solution. Organizations may decide before the RFP if they prefer cloud or on premise, or if they prefer
integrated or best of breed. Some organizations may let vendors propose any type of solution, and then
compare all of the options. However, organizations may be better served deciding this based on their
needs before the proposals are submitted. This way, they will not be swayed by a low cost proposal or
even oversold a product that they do not truly need.
After receiving the proposals, organizations must consider not just the software and associated costs, but
the vendor providing it. Some vendors may provide better support and have more frequent upgrades.
Vendors also have different implementation styles and timelines. Organizations must conduct extensive
due diligence activities, such as site visits to other organizations that have used that vendor, to make sure
they choose a vendor with software that meets their needs and is a company they want to work with.
After the vendor is chosen, a contract and statement of work must be negotiated. These legal documents
will make sure the organization receives the product and service it believes it is buying. These contracts
are often com plex and involve multiple parties, such as the software vendor, any third party solution
vendors, the software integrator, hosting provider and the organization itself. It is important that the
contract captures all of the services the organization wants and the vendor must agree to them.
Therefore, plenty of time must be allocated in the project schedule for this activity as this process can
sometimes be much slower than anticipated.
Implementation Considerations
ERP implementation efforts are notorious for being completed late and over budget. A 2014 study found
that 54% of recent ERP implementations incurred cost overruns, and 72% exceeded the expected
duration. In order to avoid these pitfalls, ERP projects must have strong executive support that is then
passed down through the organization. The project must have strong project management that has the
experience to keep the project within the agreed upon scope.
Organizational change management is also very important. It is critical to have staff buy-in and be active
participants in the project. Without staff buy-in, it is unlikely that they will be receptive of process changes.
Important organizational change management components include proper communication about the
project, allowing staff to give their input into decisions that will affect them, and proper training so staff
know how to use the system.
Technology considerations are obviously very important. For example, implementing a solution with
extensive modifications can be problematic. As more changes are introduced to the source code of the
application, the software becomes more complex to maintain and applying future updates can be
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challenging. In addition, it is important to have sufficient technology infrastructure in place to support the
new ERP system. A system deployed via the cloud will require a strong network connection for all users,
while an on premise system will need servers, storage, operating systems, infrastructure monitoring tools,
etc. Adding instant failover capabilities for internet should be a high priority if a cloud system is chosen.
While the City maintains a backup internet connection, if the GCAT datacenter is lost, the backup internet
connection would be unavailable due to lack of backup switching capabilities. Without the proper
infrastructure, an ERP system will not meet its full potential.
It is important to consider the best implementation project management approach for deploying an ERP
system as well. Traditionally, implementation project managers employed a standard ‘waterfall’ approach
to project management. With a waterfall approach, each stage of the project must be 100% complete
before moving to the next stage of the engagement. For example, planning and requirements gathering
for the whole phase of an implementation must be completed before configuration can begin. The
waterfall approach focuses on having complete documentation at each step. Various system components
cannot be tested by end users at all until near the end of the project.
The agile implementation approach started as a software development methodology, but aspects of are
now regularly employed in ERP implementations. Agile focuses on breaking the project down into smaller
pieces, and focusing on the implementation activities with specific components of an overall phase. For
example, planning, design, and configuration will all happen just for one key business process workflow at
a time versus the whole system deployment. This makes the process more adaptive and if a problem
arises, it can be caught before it is too late to reverse course. With a waterfall methodology, if a
requirement was not properly communicated to development staff, it would not be identified until the
entire system is in testing. With agile, the problem is caught faster, and now lessons learned from that
problem are incorporated into future requirements gathering. Agile stresses working software over
complete documentation, but that is not to say that documentation is unimportant. Documentation still
occurs but project managers employing the agile approach try to avoid getting slowed down by extensive
documentation before the software is configured.
Finally, effective recruitment and alignment of dedicated project staff is a critical factor when implementing
a new system. As systems change, the organization must ensure they have the staff required to support
and fully utilize a system. Cook County, IL is an example of a government that is ahead of the curve when
it comes to this issue. In 2015 they awarded $154 million in contracts to fund four major application
modernization projects: integrated justice, integrated property, integrated revenue, and an enterprise
resource planning system. In 2014 and 2015, the CIO hired or promoted about 1/3rd Bureau of
Technology employees to align the skills of their employees with the new technology. They targeted
employees with skills in management and systems integration to manage the new vendor relationships.
The job descriptions and postings were changed to reflect the new skills necessary for the jobs. They also
promoted employees with experience in other aspects of the County, so they could break down silos and
communicate across departments.
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3.5 TOTAL COST OF OWNERSHIP (TCO) COMPARISON
TCO Methodology
Based on Plante Moran’s experience managing projects for clients of similar size as the City of
Georgetown, we have estimated internal and external cost projections for an integrated ERP system to
replace the scope of the City’s existing Incode system for the following:
1. Status Quo (current environment) as a baseline comparison
2. Low and High Tier 2 systems on-premise
3. Low and High Tier 2 systems vendor hosted (private cloud)
4. Low and High public cloud-based systems (SaaS)
These costs are presented on a low and high scale to show the span of costs the City can expect to pay
when implementing a new solution. On the higher end, the City would be looking at a solution that
provides for greater functionality and additional implementation services. Solutions that fall into the higher
end cost estimate are often more complex and will require a greater amount of internal support from City
staff, increasing internal cost projections. Key assumptions were necessary in preparing these estimates
and these are represented at the end of this section.
TCO Assumptions
1. Implementation costs include all one time fees paid to the vendor that is not software license or
hardware costs
2. Project Contingency is 25% of the implementation costs
3. Software License fees are estimated to be 58% of the one-time fees paid to the vendor
4. Implementation Fees are estimated to be 42% of the one-time fees paid to the vendor
5. Estimated Total One-Time Fees were calculated using cost proposals and actual contract data
from previous clients.
6. Since implementation is estimated to last 18 months, one-time costs were spread out over 2
years. The total one-time license fee and first year support is included in year 1, but only 2/3rd of
the following fees are in year 1: implementation fees paid to the vendor, hardware fees, 3rd party
implementation management, Infor interface development, and project contingency. The
remaining 1/3rd of these one-time costs are included in year 2.
7. Hardware costs are estimated at 10% of the total one-time fees paid to the vendor
8. Inflation of on-going maintenance and support fees is assumed to be 3% per year.
9. Hosted support / maintenance fees are 3x the on premise cost.
10. In this TCO, Implementation FTE’s represent estimated hourly equivalents to implement the
system (not specific positions that need to be filled).
11. All scenarios are assumed to have 3 FTE’s of on-going support, for a total cost of $275,741 per
year.
12. Other annual on-going costs include miscellaneous hardware and software fees not covered in
annual support payments.
13. On-premise low scenario implementation is estimated to use 3.5 FTE’s for 18 months.
14. On-premise high scenario implementation is estimated to use 5.5 FTE’s for 18 months.
15. Private Cloud low scenario implementation is estimated to use 3 FTE’s for 18 months.
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16. Private Cloud high scenario implementation is estimated to use 5 FTE’s for 18 months.
17. Public Cloud low scenario implementation is estimated to use 3 FTE’s for 18 months.
18. Public Cloud high scenario implementation is estimated to use 5 FTE’s for 18 months.
19. System implementation management costs cover a 3rd party project manager with significant on-
site presence throughout the duration of the project.
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On-Premise
Low Scenario
On-Premise
High Scenario
Private Cloud
Low Scenario
Private Cloud
High Scenario
Public Cloud
Low Scenario
Public Cloud
High Scenario
First Year One-Time Vendor Cost Summary
Software License 649,600.00$ 974,400.00$ 649,600.00$ 974,400.00$ -$ -$
Implementation 313,600.00$ 470,400.00$ 313,600.00$ 470,400.00$ 566,219.33$ 3,158,434$
Hardware 74,666.67$ 112,000.00$ -$ -$ -$ -$
Total First Year Vendor Cost 1,037,866.67$ 1,556,800.00$ 963,200.00$ 1,444,800.00$ 566,219.33$ 3,158,434.00$
First Year Support/Maintenance Fees
Support/Maintenance or Subscription Fees (SAAS)126,802$ 190,202$ 380,405$ 570,607$ 291,442$ 437,163$
Total First Year Support/Maintenance Fees 126,802$ 190,202$ 380,405$ 570,607$ 291,442$ 437,163$
First Year Other One-Time Costs
Implementation Management 352,500$ 352,500$ 352,500$ 352,500$ 352,500$ 352,500$
3rd Party Interface Development 33,333$ 33,333$ 33,333$ 33,333$ 33,333$ 33,333$
Project Contingency 205,333$ 308,000$ 186,667$ 280,000$ 141,555$ 789,609$
Total Other First Year One-Time Costs 591,167$ 693,833$ 572,500$ 665,833$ 527,388$ 1,175,442$
First Year Internal Implementation Costs
Existing FTE Effort 3.50 5.50 3.00 5.00 3.00 5.00
Duration 12.00 12.00 12.00 12.00 12.00 12.00
Total Internal Implementation Cost 281,596$ 442,508$ 241,368$ 402,280$ 241,368$ 402,280$
Grand Total First Year Costs 2,037,430.93$ 2,883,343.73$ 2,157,473.00$ 3,083,520.33$ 1,626,417.50$ 5,173,318.83$
Remaining Implementation Costs
Remaining Vendor One-Time Costs 194,133$ 291,200$ 156,800$ 235,200$ 283,110$ 1,579,217$
Other One-Time Costs 295,583$ 346,917$ 286,250$ 332,917$ 263,694$ 587,721$
Internal Implementation Costs (6 months of FTE's)140,798$ 221,254$ 120,684$ 201,140$ 120,684$ 201,140$
Year 2 One-Time Costs 630,515$ 859,371$ 563,734$ 769,257$ 667,488$ 2,368,078$
Grand Total One Time Costs 2,541,144.00$ 3,552,512.00$ 2,340,802.00$ 3,282,170.00$ 2,002,463.25$ 7,104,233.75$
External Ongoing Costs
Support/Maintenance or Subscription Fees (SAAS)126,802$ 190,202$ 380,405$ 570,607$ 291,442$ 437,163$
Total External Ongoing Cost 126,802$ 190,202$ 380,405$ 570,607$ 291,442$ 437,163$
Internal On-Going Costs
Internal Support FTE 3.00 3.00 3.00 3.00 3.00 3.00
Internal Support Cost 275,741$ 275,741$ 275,741$ 275,741$ 275,741$ 275,741$
Other Annual Support 12,680$ 19,020$ -$ -$ -$ -$
Total Internal Cost 288,421$ 294,761$ 275,741$ 275,741$ 275,741$ 275,741$
Total Annual On-Going Cost 415,223$ 484,964$ 656,146$ 846,348$ 567,183$ 712,904$
Total Cost Summary
10-Year Ongoing System Support Cost (including infla $3,922,627.08 $4,643,106.12 $6,462,181.01 $8,452,431.78 $5,531,282.91 $7,056,089.87
Total 10-Year Cost (including inflation)6,590,573$ 8,385,821$ 9,183,388$ 12,305,209$ 7,825,188$ 14,597,487$
10 Year TCO Estimate
Cost Category
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First Year Cost Estimate
On-Premise
Low Scenario
On-Premise
High Scenario
Private Cloud
Low Scenario
Private Cloud
High Scenario
Public Cloud
Low Scenario
Public Cloud
High Scenario
First Year One-Time Vendor Cost Summary
Software License 649,600.00$ 974,400.00$ 649,600.00$ 974,400.00$ -$ -$
Implementation 313,600.00$ 470,400.00$ 313,600.00$ 470,400.00$ 566,219.33$ 3,158,434$
Hardware 74,666.67$ 112,000.00$ -$ -$ -$ -$
Total First Year Vendor Cost 1,037,866.67$ 1,556,800.00$ 963,200.00$ 1,444,800.00$ 566,219.33$ 3,158,434.00$
First Year Support/Maintenance Fees
Support/Maintenance or Subscription Fees (SAAS)126,802$ 190,202$ 380,405$ 570,607$ 291,442$ 437,163$
Total First Year Support/Maintenance Fees 126,802$ 190,202$ 380,405$ 570,607$ 291,442$ 437,163$
First Year Other One-Time Costs
Implementation Management 352,500$ 352,500$ 352,500$ 352,500$ 352,500$ 352,500$
3rd Party Interface Development 33,333$ 33,333$ 33,333$ 33,333$ 33,333$ 33,333$
Project Contingency 205,333$ 308,000$ 186,667$ 280,000$ 141,555$ 789,609$
Total Other First Year One-Time Costs 591,167$ 693,833$ 572,500$ 665,833$ 527,388$ 1,175,442$
First Year Internal Implementation Costs
Existing FTE Effort 3.50 5.50 3.00 5.00 3.00 5.00
Duration 12.00 12.00 12.00 12.00 12.00 12.00
Total Internal Implementation Cost 281,596$ 442,508$ 241,368$ 402,280$ 241,368$ 402,280$
Grand Total First Year Costs 2,037,430.93$ 2,883,343.73$ 2,157,473.00$ 3,083,520.33$ 1,626,417.50$ 5,173,318.83$
10 Year TCO Estimate
Cost Category
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Remaining and Total One-Time Costs
On-Going Costs
On-Premise
Low Scenario
On-Premise
High Scenario
Private Cloud
Low Scenario
Private Cloud
High Scenario
Public Cloud
Low Scenario
Public Cloud
High Scenario
Remaining Implementation Costs
Remaining Vendor One-Time Costs 194,133$ 291,200$ 156,800$ 235,200$ 283,110$ 1,579,217$
Other One-Time Costs 295,583$ 346,917$ 286,250$ 332,917$ 263,694$ 587,721$
Internal Implementation Costs (6 months of FTE's)140,798$ 221,254$ 120,684$ 201,140$ 120,684$ 201,140$
Year 2 One-Time Costs 630,515$ 859,371$ 563,734$ 769,257$ 667,488$ 2,368,078$
Grand Total One Time Costs 2,541,144.00$ 3,552,512.00$ 2,340,802.00$ 3,282,170.00$ 2,002,463.25$ 7,104,233.75$
On-Premise
Low Scenario
On-Premise
High Scenario
Private Cloud
Low Scenario
Private Cloud
High Scenario
Public Cloud
Low Scenario
Public Cloud
High Scenario
External Ongoing Costs
Support/Maintenance or Subscription Fees (SAAS)126,802$ 190,202$ 380,405$ 570,607$ 291,442$ 437,163$
Total External Ongoing Cost 126,802$ 190,202$ 380,405$ 570,607$ 291,442$ 437,163$
Internal On-Going Costs
Internal Support FTE 3.00 3.00 3.00 3.00 3.00 3.00
Internal Support Cost 275,741$ 275,741$ 275,741$ 275,741$ 275,741$ 275,741$
Other Annual Support 12,680$ 19,020$ -$ -$ -$ -$
Total Internal Cost 288,421$ 294,761$ 275,741$ 275,741$ 275,741$ 275,741$
Total Annual On-Going Cost 415,223$ 484,964$ 656,146$ 846,348$ 567,183$ 712,904$
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Costs by Year
Cumulative Costs by Year
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
On Premise Low 2,037,430.93$ 1,049,541.47$ 422,944.98$ 426,980.69$ 431,137.48$ 435,418.97$ 439,828.90$ 444,371.13$ 449,049.63$ 453,868.49$
On Premise High 2,883,343.73$ 1,350,040.38$ 496,546.97$ 502,600.54$ 508,835.72$ 515,257.95$ 521,872.85$ 528,686.20$ 535,703.95$ 542,932.23$
Private Cloud Low 2,157,473.00$ 1,231,292.15$ 679,312.66$ 691,419.81$ 703,890.18$ 716,734.65$ 729,964.46$ 743,591.17$ 757,626.67$ 772,083.24$
Private Cloud High 3,083,520.33$ 1,632,722.88$ 881,097.97$ 899,258.68$ 917,964.21$ 937,230.90$ 957,075.60$ 977,515.64$ 998,568.88$ 1,020,253.71$
Public Cloud Low 1,626,417.50$ 1,243,414.01$ 584,931.82$ 594,207.54$ 603,761.54$ 613,602.15$ 623,737.99$ 634,177.90$ 644,931.01$ 656,006.71$
Public Cloud High 5,173,318.83$ 3,094,096.81$ 739,527.23$ 753,440.81$ 767,771.81$ 782,532.73$ 797,736.48$ 813,396.35$ 829,526.01$ 846,139.56$
Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10
On Premise Low 2,037,430.93$ 3,086,972.41$ 3,509,917.39$ 3,936,898.08$ 4,368,035.56$ 4,803,454.52$ 5,243,283.42$ 5,687,654.56$ 6,136,704.19$ 6,590,572.68$
On Premise High 2,883,343.73$ 4,233,384.11$ 4,729,931.08$ 5,232,531.62$ 5,741,367.33$ 6,256,625.28$ 6,778,498.14$ 7,307,184.34$ 7,842,888.29$ 8,385,820.52$
Private Cloud Low 2,157,473.00$ 3,388,765.15$ 4,068,077.81$ 4,759,497.63$ 5,463,387.81$ 6,180,122.46$ 6,910,086.93$ 7,653,678.09$ 8,411,304.77$ 9,183,388.01$
Private Cloud High 3,083,520.33$ 4,716,243.21$ 5,597,341.18$ 6,496,599.85$ 7,414,564.06$ 8,351,794.96$ 9,308,870.56$ 10,286,386.19$ 11,284,955.07$ 12,305,208.78$
Public Cloud Low 1,626,417.50$ 2,869,831.51$ 3,454,763.33$ 4,048,970.87$ 4,652,732.41$ 5,266,334.56$ 5,890,072.55$ 6,524,250.45$ 7,169,181.46$ 7,825,188.16$
Public Cloud High 5,173,318.83$ 8,267,415.64$ 9,006,942.87$ 9,760,383.68$ 10,528,155.49$ 11,310,688.22$ 12,108,424.70$ 12,921,821.05$ 13,751,347.06$ 14,597,486.62$
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Cumulative Investment Comparison Graph
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3.6 OPTIONS ANALYSIS & RECOMMENDATION
Consistent with project objectives and based on the evaluation of the current functional and the
technology environment, the City has three primary options in regard to the deployment of a future
applications environment. These are analyzed in additional detail throughout this section of the report.
Option #1: The City would procure the hardware and software for a new ERP
system and deploy in the City’s environment on-premise.
Plante Moran believes this option presents the following advantages and disadvantages to the City:
Advantages Disadvantages
1. Software License: With a perpetual license,
on premise solutions still offer an indefinite
right to use the software.
2. Data Ownership: With data stored and
managed on premise, there is no question
regarding how to retrieve that data in an
emergency or disaster.
3. Interfaces: On-premise ERPs make it easier
to create interfaces between the many
different systems that different departments
will continue to use.
4. Customization: The flexibility in
customization will allow the City to adapt the
system to unique processes with less system
constraints.
5. System mitigation: Client ownership of data
in on premise servers makes migrating to
another system easier, should that be desired
in the future.
6. Cost: From an external cost perspective, on-
premise solution is the lowest 10 year TCO.
1. Infrastructure: As the city grows, more infrastructure
may need to be purchased and maintained to support
more users and data.
2. FTE’s: More FTE’s are required to maintain the
system and associated infrastructure.
3. Upfront costs: On premise solutions require high up-
front costs for infrastructure and implementation.
4. Upgrades: Upgrades must be purchased and
implemented by the client, including what can be
extensive time spent on the project.
5. Obsolete: Advances in software can render the
software obsolete before it is economically viable to
upgrade or switch systems again.
6. Customization Cost: Extensive customizations can
make upgrading the system difficult and expensive.
7. Processes: The ability to extensively customize the
system can lead the City to adapt it to their current
processes, instead of evaluating and implementing
best practices.
8. Cost: Costs are more unpredictable than cloud
solutions.
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Option #2: The City would procure the software for a new ERP system and
host in the vendor’s private-cloud environment (off-premise)
Plante Moran believes this option presents the following advantages and disadvantages to the City:
Advantages Disadvantages
1. Software License: With a perpetual license,
vendor hosted solutions still offer an indefinite
right to use the software.
2. Data Ownership: Data is still owned by the
City.
3. Customization: The flexibility in
customization will allow the City to adapt the
system to unique processes with less system
constraints.
4. FTE’s: City FTE’s will not be required to
maintain the system and associated
infrastructure if vendor hosted.
5. Infrastructure: As the city grows,
infrastructure will not have to be purchased if
vendor hosted.
1. Upgrades: Upgrades must be purchased and
implemented by the client, including what can be
extensive time spent on the project.
2. Obsolete: Advances in software can render the
software obsolete before it is economically viable to
upgrade or switch systems again.
3. Customizations: Extensive customizations can make
upgrading the system difficult and expensive.
4. Best Practices: The ability to extensively customize
the system can lead the City to adapt it to their current
processes, instead of evaluating and implementing
best practices.
5. Cost: Costs are more unpredictable than cloud
solutions.
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Option #3: The City would ‘subscribe’ to and implement an ERP ‘Public Cloud’
solution.
Plante Moran believes this option presents the following advantages and disadvantages to the City:
Advantages Disadvantages
1. Upfront Costs: There are less up-front costs
associated with cloud systems since little
infrastructure is needed.
2. Upgrades: The City’s system will always be
compatible with upgrades, and in some cases
the upgrades are included in the SaaS license
fees. Upgrades are handled by the vendor
and require less effort than traditional on
premise upgrades.
3. FTE’s: Less FTE’s are required to maintain
the system. Staff can be shifted from
maintaining the hardware and software to
other value added activities.
4. Security: Most SaaS providers offer data
security standards that exceed many local
government practices, including redundant
data centers and regular data back-ups.
5. Processes: Most City processes are not
unique, so functionality available in Public
Cloud solutions could be sufficient.
6. Scalability: Scaling up the system is easy as
the city grows and the system needs more
users and data storage.
7. Best practices: Public Cloud solutions are
usually tailored to fit best practices, so
implementing a new cloud system would be a
good time to evaluate process efficiency.
8. Obsolete: Continual access to updates will
reduce the chance of the system becoming
obsolete.
1. Migrating Data: Migrating data off the system can be
difficult.
2. Network: Absent a stable network connection, the
system will not function.
3. Vendor Relationship: While the technical support
necessary will decrease, the City needs to increase
the effort spent managing the relationship with the
vendor and tracking service provided compared to the
Service Level Agreement.
4. Control: There is less control over when updates are
applied, so the City must be ready to train users on
any differences and adapt quickly to avoid process
disruptions.
5. Interfaces: Maintaining the interfaces between the
public cloud and other off-premise hosted systems
may be difficult due to the lack of control over
updates. As the system on either side of the interface
is updated, the interface may need to be changed to
continue to function properly.
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Recommendation
Plante Moran evaluated three scenarios to assist the City in making a decision on a preferred approach to
modernize the ERP environment. Plante Moran believes that all three of the options presented are viable
considerations for the City. All three of them have advantages and disadvantages, so therefore it is
important that the City consider the ultimate goals and criteria that will be used to measure the success of
the project. Based on the City’s current ERP environment and other factors that tie into the process of
making a decision that will best serve the needs of the City over the long-term, Plante Moran viewed the
following key criteria and factors in assessing each of the options and making a strategic direction
recommendation:
• City FTE’s available to implement and support the ERP system
• City technical infrastructure
• System deployment “fit” with what is generally observed with other organizations of a similar size
and complexity
• Ability for the City to take on risks, such as availability of resources during implementation,
tolerance for change, sustainability of complex technology investments, and long-term support for
• Ability to expand the solution set to incorporate needs that have not currently been implemented
• City staff knowledge and use of current technology capabilities and best/next business practices
that exist in current ERP systems
• Ability for City to commit the necessary resources for the change to include both staff time and
financial expenditures
• Timeframe associated with achieving benefits from deployment option
• Desire to lessen dependence on internal IT support resources
• Willingness for the City to consider solutions that are hosted external to the City
Based on the above factors as assessed by Plante Moran during the course of our interview process and
collection of background information, we feel that the most prudent course of action is to proceed with
either a public or private cloud deployment (Option 2 or Option 3) method for the following reasons:
1. Upfront Costs: There are less up-front costs associated with cloud systems since little
infrastructure is needed.
2. Upgrades: Your system will always be compatible with upgrades, and in some cases the
upgrades are included in the software license fees. Upgrades are handled by the vendor and
require less effort than traditional on premise upgrades.
3. Ongoing support: Less FTE’s are required to maintain the system. Staff can be shifted from
maintaining the hardware and software to other value added activities.
4. Security: Most SaaS providers offer data security standards that exceed many local government
practices, including redundant data centers and regular data back-ups.
5. Processes: Most City processes are not unique, so functionality available in cloud solutions
should be sufficient.
6. Scalability: Scaling up the system is easy as the city grows and the system needs more users
and data storage.
7. Upgrade Frequency: Continual access to updates will reduce the chance of the system
becoming obsolete.
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4. ERP Marketplace Overview
Generally, enterprise system solutions evolved out of a desire to provide the functionality of two or more
systems, such as financials and human resources, in an integrated software solution. Enterprise resource
planning (ERP) software solutions experienced their first major growth in private sector businesses in
their manufacturing and supply chain operations. Over the past several years, these solutions were
enhanced, configured, and tested in public sector organizations. With these enhancements, those
solutions originally developed for private sector organizations could now be deployed in a public sector
setting.
This appendix provides an overview of the ERP marketplace, organized as follows:
• Vendor consolidation update
• Market Consideration: Tier 1 vs. Tier 2 ERP
• Market Consideration: On-Premise vs. ‘The Cloud’
• Market Consideration: Integrated vs. Best of breed
4.1 VENDOR CONSOLIDATION UPDATE
Consolidation among public sector software vendors has left a fewer number of vendors providing
customized services to the public sector than in prior years. Organizations such as Harris, Oracle,
SunGard Public Sector, Infor and Tyler Technologies have acquired competing software offerings over
time and, to varying extents, marketed, licensed, implemented, and supported each of them. As such, the
remaining vendors have a larger installed base per vendor. It is anticipated that, over time, these vendors
will reduce, not increase, the number of ERP solutions that they will maintain and support for the public
sector. This consolidation of solution offerings is typical in the software industry as a result of their desire
to create a sustainable business model. Thus, it is important during the due diligence and contract
negotiation process to consider any future product plans available from software providers, with the
purpose of maximizing solution longevity and avoiding expensive capital outlays for upgrades and
replacements.
4.2 MARKET CONSIDERATION: TIER 1 VS. TIER 2 ERP
Tier 1 vendors provide broad offerings that often include modules for customer relationship management
(CRM), enterprise asset management (EAM), learning management, analytics and reporting, data
warehousing, and project management modules. While Tier 1 providers offer robust core financial
modules, as well as human resources and payroll, typically they rely on third party vendors for
functionality specific to government activities in other functional areas. Most, but not all, Tier 1 providers
have a large network of implementers available to implement their solution, many of which have
dedicated public sector practices. The most significant challenge with Tier 1 solutions is that government
agencies often find that they are not able to dedicate enough technical resources to leverage expansive
capabilities of the system to meet their needs. Due to their flexibility (thus complexity) Tier 1
implementations are most successful at organizations with structured IT software governance and/or ERP
process governance, not typically demonstrated in organizations which have implemented a fragmented
software approach. In addition to the necessary governance, strong IT project management is also critical
for the successful deployment of Tier 1 solutions. In several instances, Plante Moran has worked with
public sector clients who have implemented Tier 1 ERP systems and the following situations have
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prevented them from realizing the full benefit of these systems; thus diminishing their return on
investment:
• The governmental body did not budget the necessary capital to implement the solution and
optimize current business processes due to cost factors related to capital budget and resource
constraints.
• The operating costs to maintain Tier 1 solutions relative to software maintenance and support
consumed operating budgets thus creating a situation where hiring the necessary internal
resources to maintain and enhance these systems (e.g., data mining, workflow, custom reporting)
was not feasible.
There are a number of Tier 2 ERP software providers that offer specific vertical solutions designed for the
public sector including fund accounting, encumbrance accounting, sophisticated budgeting, grants
management, etc. and capabilities which are pervasive in this segment. These Tier 2 solutions are
normally deployed in medium sized public organizations. Over time, there has been increased focus from
these Tier 2 vendors towards developing niche solutions designed to compete with the Tier 1 providers.
Users of Tier 2 solutions often find that these solutions are more prescriptive; i.e., governmental best
practices are designed within the application. This is intuitive since Tier 2 solutions were designed for use
within the government sector. They may offer less flexibility and configurability than Tier 1 system but, as
a result, are typically less cumbersome to implement within their organization, because of their native
public sector design and more prescriptive implementation approach. Tier 2 vendors tend to have their
origin based in the government sector and have been improving and updating their software products to
offer a greater range of modules and functionality. As such, the Tier 2 vendors are touting themselves as
viable alternative solutions to Tier 1 providers; however, beyond enhanced functionality, the scalability of
the services being offered by Tier 2 solution providers is a strong consideration when determining the
best overall solution. Unlike Tier 1 solution providers, nearly all Tier 2 solution providers implement their
own software and do not rely on third party implementers.
The software marketplace has seen the emergence of solutions being touted as Tier 1.5s, or “one and a
halves.” Originally positioned as Tier 1 or Tier 2 solutions, these vendors have now positioned
themselves between the two tiers and often offer enhanced functionality in areas such as human
resources and payroll. They are also offering modules that are able to scale up to a larger client’s
complexity and transaction volume but at a lower cost and time to implement as compared to a Tier 1
provider.
A third tier of software providers (i.e., Tier 3) also exists that are implemented in small organizations and
will not be discussed in this report due to the lack of relevance to the City of Georgetown. Medium size
government agencies, such as the City, generally select financial management solutions identified as
either Tier 1 or Tier 2 solutions. The most basic differentiation between Tier 1 and Tier 2 providers lie
within the depth of functionality, breadth, and complexity of the software.
As identified by Gartner Research, there are still distinct differences between Tier 1 and Tier 2 software
providers in the ability to address all business needs. Tier 1 vendors, such as IBM, Microsoft, Oracle, SAP
and UNIT4, garner economies of scale by focusing on a smaller set of back -office capabilities and
building add-ons to products they sell in other vertical markets. They attempt to address local
government-specific business requirements, such as permitting and licensing, by building templates using
a combination of ERP, CRM, and business intelligence (BI) products. Conversely, the Tier 2 provider’s
smaller scale allows for country-specific business and regulatory compliance requirements, and positions
them to focus on local government-specific capabilities. In order to meet a greater subset of business
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needs, they have evolved through a number of acquisitions that have led to solutions that satisfy both
back-office and front-office business requirements. The struggle, however, has been to evolve toward an
integrated suite package while continuing investments in business development for the separate
products.
While overlap occurs, generally Tier 1 vendors are more prevalent in larger communities over 375,000
population while Tier 2 vendors occupy the market space for communities below this threshold. Large
global vendors tend to focus on the largest local government jurisdictions. The cost of their solutions and
their business models, which usually require a system integration partner for design, configuration and
implementation, are usually beyond the means of smaller jurisdictions. Conversely, local independent
software vendors tend to be viable for smaller jurisdictions and have pricing and implementation timelines
that tend to be more favorable for midsize and small local government organizations.
Table 3 identifies some of the key differences between Tier 1 and Tier 2 software providers on issues
such as support requirements, cost of implementation services, and cost for major version upgrades,
software support channel, and other factors.
Table 3: Comparison of Tier 1 v Tier 2
Tier 1 Tier 2
Sample
Representative
Vendors
Oracle (Oracle e-Business Suite, PeopleSoft)
SAP
Workday
Infor (Lawson) (1.5)
CGI
UNIT4/ITP (1.5)
Others
Harris (Innoprise)
Microsoft Dynamics AX
New World Systems (recently purchased by Tyler
Technologies)
Springbrook Systems
SunGard Public Sector (ONE Solution)
Tyler Technologies (New, World, Eden, MUNIS)
Others
Design
Considerations
Developed product for private sector and later
adapted for public sector
Many modules specific to public sector
Larger organizations with greater R&D budgets,
offer more robust technology
Robust development tools
Scalable to leverage most robust development
and database environments
Primarily designed for public sector
More prescriptive functionality and less
conducive to customization without altering
source code
Often leverage common municipal technology
standards (e.g. MS SQL database); some
support Oracle
Environments leverage third party tools
(database, report writer, etc.)
Ongoing
Technology
Support
Resource
Requirements
Most require multiple technology FTEs to support
Also impacted by level of integration with other
organizational systems
Requires fewer technology FTEs to support
Also impacted by level of integration with other
organizational systems
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Tier 1 Tier 2
Software
Functionality
Core modules have robust functionality
May lack public sector specific features (e.g.
encumbrance rollover, GASB 34 reporting)
License costs per user typically more expensive
than Tier 2
Incrementally less robust functionality for core
components
HR/Payroll modules are frequently less robust as
compared to Tier 1 offerings
Many vendors offer additional public sector
modules, such as fleet management, request for
service, etc.
License costs per user typically less expensive
than Tier 1
Implementation
Services for New
Installation
Requires multiple full time staff to implement
Requires significantly greater implementation
vendor resources than Tier 2 to implement
including key staff that are full-time to the project
Software implementers are typically
integrators/channel partners
Implementation services cost ratio comparison to
license fees often many times software cost
(frequently 3:1 or higher)
Vendor “homework” approach has organization
responsible for many implementation tasks
Frequently implemented with organization
resources not dedicated to the project
Rarely requires full-time vendor staff to
implement
Software vendors also implement their own
solutions
Implementation services ratio typically closer to
1:1; 2:1 would be more robust services approach
Staff required for
Implementation
6 to 12 FTEs 3 to 7 FTEs
Ongoing support
staff required
3 to 8 FTEs 1 to 3 FTEs
Cost Model for
Major Version
Upgrades
Most major upgrades include significant license
fee costs
Most major upgrades require significant levels of
vendor services to assist
License fees for version upgrades often included
with maintenance fees
Most major upgrades require moderate levels of
vendor services
Software Support
Channel
Mixed; some direct, some through implementer /
value added reseller channel
Primarily direct vendor support
4.3 MARKET CONSIDERATION: ON-PREMISE VS. ‘THE CLOUD’
Over the last couple of years, there has been an acceleration of vendor products moving to the cloud and
touting themselves as “cloud providers” to be consistent with buzzwords in the marketplace; however, in
certain situations these vendors have merely offered up a hosted solution in which there software is being
installed remotely while other vendors are offering up true cloud-based solution that support elements of
the NIST standards to include multi-tenancy. In certain situations, these cloud offerings have been
available for several years but are now being introduced to the governmental marketplace (i.e., Workday,
Oracle ERP Cloud). Other solutions have undergone a rewrite of their applications to make themselves
true cloud solutions (i.e., Infor’s CloudSuite), while certain vendors have re-architected their solution to
operate as a cloud solution (i.e., Advantage 360). An overview of the vendors in the marketplace, as well
as the deployment approaches they offer, is provided in the table below.
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Table 4: Vendor Offerings and Deployment Approach Options
The traditional on-premise deployment was the primary strategy for local governments for many years,
who looked favorably on the flexibility and overall control they had over the application software,
hardware and organizational data. As the ownership of the software is perpetual and the development of
the solution is unique to the client, on premise solutions are regularly selected and deployed by those
governments that are required to extensively customize their software to meet unique business
requirements.
Similar to the traditional on-premise deployment, solutions hosted off-premise in a private cloud also
support more customization and are regularly on a single tenant model. The private cloud deployment
approach, can allow for flexibility from an ‘exit strategy’ perspective as well as the benefits that are
aligned with the hosting vendor taking on much of the back-office maintenance and support that would be
taken on by the client in an on premise model.
Public cloud solutions are less flexible, from an ability to modify the software perspective, but also require
much less maintenance and technical staff to support them. Public Cloud SaaS solutions are by
definition, multi-tenant which indicates that numerous customers utilize the same instance of the solution.
Vendor/Application Tier Traditional – On
Premise Private Cloud Public Cloud
(SaaS)
CGI/Advantage 360 1
CGI/Advantage 1
Infor/Lawson 1.5
Infor/CloudSuite 1.5
Harris/Innoprise 2
Oracle/E-Business 1
Oracle/JD Edwards 1
Oracle/PeopleSoft 1
Oracle/Cloud ERP 1
SAP 1
Springbrook 2
Workday 1
Microsoft/Dynamics AX 2
Sungard/OneSolution 2
Tyler/Eden 2
Tyler/MUNIS 2
Tyler/New World Systems 2
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As a result, when an upgrade is readily available, every customer will receive the upgrade at the same
time.
Traditionally, on premise was the preferred choice for implementing an ERP solution however, private
cloud implementations have become increasingly popular. Most traditional software providers now offer a
private cloud alternative, however only a handful are offering public cloud ERP to the local government
marketplace. Vendors have confused the issue by referring to all ‘flavors’ of ERP subscription pricing as
‘cloud’ deployment offerings, however it must be noted there is a difference between the three
deployment models
regardless of how they are
priced.
Moving to public cloud ERP
solutions, in theory, should be
a very marketable ERP
deployment strategy for small
to mid-size local government
organizations. In general,
public cloud solutions
typically have lower initial
investment and project period
costs since significant
infrastructure spending is
usually not required. Public
cloud costs are more
predictable, usually incurring
a monthly fee that is set in
advance and as customization options are limited, it is easier to scale for small to midsize organizations
looking for standard financial, human resources and payroll functionality. In addition, in an era when local
governments are routinely multiple versions ‘behind’ the current release, moving to a public cloud offering
allows organizations with the cloud to more easily stay current with technology. Whereas, on premise
solutions routinely required significant upgrades that made enhancing the functionality of a system
unaffordable, public cloud solutions offer regularly scheduled upgrade capability and the ability to more
quickly and take advantage of new technology trends. As local governments are increasingly challenged
to finance large scale ERP implementations and retain highly qualified technical resources necessary to
maintain the ERP systems once they are implemented, the public cloud should theoretically ‘level the
playing field’ and provide small to mid-size governments the opportunity to operate powerful business
solutions with minimal long-term risk of being unable to support and optimize the investment.
4.4 MARKET CONSIDERATION: INTEGRATED ERP VS. BEST-OF-BREED
Another consideration in the market is whether to obtain all desired functionality in one integrated
enterprise system, or implement a multi-vendor best-of-breed infrastructure. To be clear, a best-of-breed
does not break out financial components, but rather offers state-of-the-art management of typically
complex areas like budgeting, grants and asset management.
The decision-making process needs to focus on the management of infrastructure and access to
resources to maintain and upgrade the system it ages. A single vendor system can bring a less complex
and faster deployment with encompassing configuration and design approaches. A best-of-breed solution
can improve workflow and capture important data related to revenue for specialty areas. A single vendor
Cost Component Comparison
Traditional On Premise
•One time upfront license fee (at contract signing)
•Implementation professional services fees (duration of project)
•Hardware fees (upfront)
•Ongoing Maintenance and Support fees (12 months after
contract signing)
“Private Cloud” Hosted
•One time upfront license fee (at contract signing)
•Implementation professional services fees (duration of project)
•Ongoing Maintenance and Support fees (12 months after
contract signing)
•Monthly or annual hosting fee (required at software
installation)
“Public Cloud”/SaaS
•Implementation professional services fees (duration of the
implementation)
•Monthly or annual software subscription fee (varies by vendor
but usually due at contract signing)
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system can mean easier integration of data, while a best-of-breed approach prevents an organization
from being dependent on a single vendor’s plans for support and expansion.
This decision is highly dependent on revenue projections for the organization, and should be considered
with forward/future thinking, not just addressing ways to address current challenges.
Table 5 presents an overview of the advantages and disadvantages of integration vs. best-of-breed.
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Table 5: Summary of Integrated v Best of Breed
Integrated ERP Best of Breed
Ad
v
a
n
t
a
g
e
s
Meets the needs of the organization as a whole.
Rather than provide the best solution for each
functional area, ERP solutions tend to be designed
for the needs of the broader organization focused
around processes versus functions.
Better optimize business processes. Because they
tend to be designed around processes, ERP
solutions provide a better platform for process
optimization (depending on how it’s configured)
including cross-functional workflow.
Improved reporting. Many ERP vendors provide a
variety of canned reports and specialized reporting
tools. A single database typically allows for more
robust reporting across functional areas
Market trends. The market for ERP systems in the
public sector continues to evolve. The trend is
toward consolidation as companies acquire best of
breed solutions to build into their solutions.
Potential for more robust functionality. Each system
is selected and implemented to accommodate the
needs of the specific functional area(s).
Vendor independence. A best of breed approach
allows greater flexibility and independence versus
a single vendor. Over time, the organization is in a
better position to replace a single system if its
functionality becomes inadequate or obsolete.
Di
s
a
d
v
a
n
t
a
g
e
s
Change management. A new ERP typically
requires more thoughtful consideration and
planning for change management. In any
organization, the introduction of new processes
coupled with new technology is typically met with
varying and unpredictable degrees of staff
resistance. Some organizational change may
result, adding to the complexity.
Significant capital investment. The selection and
procurement of an ERP requires a sizable
investment with software licensing, vendor
consulting resources, internal staffing, and other
related project expenditures.
Implementation risk. Given the robust functionality
and flexibility of some ERP solutions, there is
increased risk given the decisions and
interdependencies that exist. A higher degree of
ERP experience (and a good contract) can help
mitigate risk.
Complex reporting. Database complexity can
create reporting challenges and will require
dedicated and long-term support.
Risk commensurate with integration experience.
Risk of system issues increases with integration
complexity and the organization’s experience /
resources to deal with the complexity.
Added support for multiple systems. The staffing
requirements increase due to the necessity to
develop and maintain the interfaces between
applications.
Information silos. In best of breed situations, the
characteristic “islands of information” are a result
requiring complex data warehousing. Further,
interfaces are not as robust as true integration.
Distraction from core mission. Developing
integration between best of breed modules requires
strategic allocation of resources away from other,
perhaps transformational /innovative strategic
goals.
Fragmented and inefficient processes. As
processes flow across functional areas, so must
information. Streamlined work flow becomes more
challenging in a non-integrated environment.
Page 74 of 103
{Thank You!}
Page 75 of 103
City of Georgetown, Texas
Government and Finance Advisory Board
May 31, 2017
SUBJECT:
Employee Compens ation, Benefits and Wellnes s Update - Tadd Phillip s , Human R es o urc es Directo r
ITEM SUMMARY:
Human Res o urc es s taff will give an o verview of the City’s employee compens atio n, b enefits and wellnes s
p ro grams. This is no t an actio n item.
FINANCIAL IMPACT:
To b e disc uss ed in pres entatio n.
SUBMITTED BY:
Tadd Phillip s , HR Direc tor
ATTACHMENTS:
Description Type
Pres entation Pres entation
Page 76 of 103
FY2018 Annual Budget
FY2018 Budget
Employee Compensation & Benefits/Wellness
Update
GGAF
May 31st, 2017
1Page 77 of 103
FY2018 Annual Budget
Executive Summary
•FY2018 City Manager Proposed Budget will include Compensation &
Benefits programs aligned with Fiscal & Budgetary Policy
•Compensation
–Market –annual pay plan review
–Merit -pay for performance for non-public safety employees
–Civil Service Step –follow meet and confer agreements
•Benefits
–Healthy Fund Reserve
–Anticipate maintaining current benefits with no additional contributions
from City or employees
•Wellness
–Increased program participation for 2017 calendar year
–Robust programming and opportunities for City Staff
2Page 78 of 103
FY2018 Annual Budget
Compensation Overview
•Council Strategy: Attract, hire, develop & retain the best
people, and compensate them for the value they create
•Tactics include establishing and consistently administering
a competitive compensation program based on
performance results
3Page 79 of 103
FY2018 Annual Budget
Total Rewards
4Page 80 of 103
FY2018 Annual Budget
Compensation Approach
Fiscal & Budgetary Policy
•Competitive Compensation –In order to maintain a competitive pay scale,
the City has implemented a Competitive Employee Compensation
Maintenance Program to address competitive market factors and other
issues impacting compensation. The program consists of:
–Annual Pay Plan Review –To ensure the City’s pay system is accurate and
competitive within the market, the City will review its pay plans annually for
any potential market adjustments necessary to maintain the City’s competitive
pay plans. (Market)
–Pay for Performance –Each year the City will fund performance based pay
adjustments for regular non‐public safety personnel. This merit‐based program
aids in retaining quality employees by rewarding their performance. Pay for
Performance adjustments are based on the employee’s most recently
completed performance evaluation. (Merit)
–Public Safety Steps –Each year the City will fund anniversary step increases for
public safety sworn personnel consistent with public safety pay scale design.
(Steps)
5Page 81 of 103
FY2018 Annual Budget
Fire & Police
•Texas Local Government Code 142 Subchapter
B (Police) and C (Fire)
–Allows Associations to petition to meet & confer
–COG granted recognition
–Allows the association and city to meet and confer
over wages, salaries, rates of pay, hours of work,
and other terms and conditions of employment
6Page 82 of 103
FY2018 Annual Budget
Fire & Police
•Fire
–Council ratified agreement on June 28, 2016
–Agreement in place July 1, 2016 –September 30, 2019
•Police
–Council ratified agreement on August 9, 2016
–Agreement in place October 1, 2016 –September 30,
2019
•Agreements specify city comparators & pay
philosophy
7Page 83 of 103
FY2018 Annual Budget
FY2018 Market Summary
•New: Defined Central Texas jobs vs Texas Area
–Where do we recruit and lose employees?
–Most positions (66% of benchmarks) compared to
Central Texas
–Management and specialized municipal
professional positions compared to both Central
Texas and Texas Area comparators
•Industry specific comparators used selectively:
–Bryan Texas Utilities, New Braunfels Utilities, CPS
Energy, LCRA, College Station
8Page 84 of 103
FY2018 Annual Budget
Market Comparators
Central Texas
Austin
Cedar Park
Leander
Pflugerville
Round Rock
Williamson County
San Marcos
New Braunfels
Texas Area
Sugar Land
Grapevine
Denton
Flower Mound
9Page 85 of 103
FY2018 Annual Budget
FY2018 Market Summary
•Reviewed Pay Structures in March/April 2017
•What did we compare?
–Range midpoint to market average midpoint
–Actual salary to market average actual used for
some executive, single incumbent positions
•What do we consider competitive?
–Within 5% is considered market competitive
–-5% is considered below market competitive
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FY2018 Annual Budget
FY2018 Market Summary
•Non-Civil Service job titles -246
•Benchmark job titles-112 (46%)
Preliminary Results:
•Within Market: 72 %
•Below Market:28 %
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FY2018 Annual Budget
1%
29%
53%
17%
2017 Merit Distribution
Below 0%
Meets 1%
Exceeds 2%
Excellent 3%
Pay Increase Provided
Based on Performance
Merit History FY2017
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FY2018 Annual Budget
FY2018 Planning
•Plan to continue Competitive Employee
Compensation Maintenance Program in order
to attract and retain the best people including:
–Market
–Merit
–Steps
•Specific recommendations will be developed
as part of the City Manager’s proposed budget
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FY2018 Annual Budget
Benefits Program
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FY2018 Annual Budget
Benefits History
•Self-Insurance began January 1, 2014
•Plan year begins January 1, Fiscal year October 1
•Changed administrator/network from Aetna to United
HealthCare January 1, 2016
–Significant reduction in stop-loss and administrative costs
–Employee experience has been positive
•Expenses significantly under budget in Fiscal 14 & 15
–Right at budget in FY 16
15Page 91 of 103
FY2018 Annual Budget
Benefits History
•The largest and most volatile expense to the fund are medical
and pharmacy claims. Fluctuations occur both seasonally and
episodically. Reinsurance, conservative budgeting, and fund
reserves are essential to a healthy program.
-
100,000
200,000
300,000
400,000
500,000
600,000
Jan Feb Mar April May Jun July Aug Sept Oct Nov Dec
12 months Net Claims 2016
16Page 92 of 103
FY2018 Annual Budget
Vendor Relationships
•Staff works diligently with United Health Care to identify risks
and mitigate costs to the self-insurance fund.
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FY2018 Annual Budget
Self Insurance Fund Reserve
•Strong reserve policy and balance
Reserve
Fiscal Year As of September 30th, 2016
Beginning Balance $2,129,907
Revenues $5,873,534
Expenses $5,797,454
Ending Fund Balance $2,205,987
IBNR
10% of annual expense*
$556,400
Premium Stabilization Reserve
10-20% of annual expenses*
$1,112,800
Remaining Balance $536,787
*Annual expenses = claims, admin, and S/L 18Page 94 of 103
FY2018 Annual Budget
Employee Benefits Program Goals
1.Maximize employee health
2.Assure competitive and current plan offerings
and design
3.Maintain program affordability for City and
employees
4.Facilitate employee plan navigation and
consumerism
5.Compliance and administration
•Staff is working tactical plan built from goals
19Page 95 of 103
FY2018 Annual Budget
Current Benefits Update
•Received Rate Pass for 2018 plan year
–Life Insurance & Vision -MetLife
–Short Term Disability/Long Term Disability -
Dearborn
•Based on current and know expense trend and
fund reserve status, we do not anticipate a
need to increase contribution levels from City
or employees next fiscal year.
20Page 96 of 103
FY2018 Annual Budget
FY2018 Planning
•SI Fund cost will be continuously monitored
and projections update through July
•Specific recommendations will be developed
as part of the City Manager’s proposed budget
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FY2018 Annual Budget
Wellness Program
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FY2018 Annual Budget
Current
•2 wellness sessions annually
•PTO incentive
•Biometric Screening/Assessment –
requirement
•Onsite fitness classes, lunch & learns, wellness
challenges
•Online platform
•S.T.R.O.N.G
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FY2018 Annual Budget
Wellness Program Goals
1. Increase Participation
–Biometrics & Overall Program Participation P
2. Create link between wellness program incentives
and benefits
–Create premium incentive for participating in the
Health Risk Assessment & Biometric Screenings and for
meeting biometric goals
3. Reduce administrative load of program
–Create online tracking system for programs and
incentives P
24Page 100 of 103
FY2018 Annual Budget
Participation
Wellness Program
Completion
Biometric
Screenings
2015 14%50%
2016 15%55%
2017 70%
25Page 101 of 103
FY2018 Annual Budget
FY2018 Planning
•Research incentive structures/options for 2019
plan year
•Continue to work with Bravo on program
design
26Page 102 of 103
FY2018 Annual Budget
Questions or Comments?
27Page 103 of 103