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Title: OCTOBER%2029,%202008

  • OCTOBER 29, 2008
  • 900 am to Noon

PPC Agenda
  • Finance Transformation Jeff Mandel / Sharon
  • BMWBO Kathryn Waters-Perez
  • Materials Walt Quade
  • Services Roxana Dietz
  • Agency PO/Contracts Jeff Mandel
  • Contract Attachments Sue Rojas
  • Procurement Handbook Updates Sue Rojas
  • SRM Joan Kraft / Cheryl Kleeman
  • E-Marketplace Updates Scott Cross / Sue Plecker
  • Quality Assurance Paul Wolf
  • Training Jeff Mandel
  • Note This PPC Presentation will be available on
    our Agency Dashboard web site following this

Project Purpose and Goals
  • Purpose
  • To further transform the Commonwealths current
    financial administration operations using leading
    practices, processes and technologies
  • Goals
  • Identify and Implement Strategies to Reduce Cost
  • Use Available Resources More Efficiently
  • Improve Accuracy
  • Reduce Transaction Processing Time
  • Improve Invoice Processing Imaging
  • Improve Cash Management Revenue Processing
  • Design Quality Assurance Function
  • Develop a Strong Internal Audit Function
  • Develop Training Organization

Project Scope
The following processes, activities, and systems
are being addressed through the Finance
Transformation project
Policy Process Procure to Pay Chart of Accounts/GL Revenue/Cash Management Accounts Receivable Budgetary Accounting Comprehensive Annual Financial Report (CAFR)/Financial Reporting Internal Audit
Talent People Change Management and Communications Knowledge Transfer to Commonwealth Project Staff Organization Realignment and Transition Education and Training Change Management and Communications Knowledge Transfer to Commonwealth Project Staff Organization Realignment and Transition Education and Training
Systems Information SAP ECC 6.0 Configuration SAP Workflow Scanning, Imaging and Indexing SAP ECC 6.0 Configuration SAP Workflow Scanning, Imaging and Indexing
Current Status
  • Between March and June, the following activities
    were completed
  • Process reviews including procure to pay,
    revenue, accounts receivable, reporting/CAFR,
    chart of accounts, grants, budgetary accounting,
    special accounting and audits
  • Workshops with OB, agency and key stakeholders
  • Workshops produced approximately 100
    recommendations focused in the following areas
  • Process
  • Technology
  • Organization structure
  • Or, a combination of the above
  • In July, recommendations were validated and
    analyzed, and grouped into the following
  • Short-Term able to be completed by May 2009
  • Medium-Term able to be completed by July 1, 2010
  • Long-Term beyond 2010 and dependent on other
    technology not owned by the Commonwealth
  • In August and September, the recommendations were
    prioritized, reviewed and ranked by the Steering
  • Detailed process and technical design is underway
    for prioritized recommendations
  • Build Phase October through May 2009

Financial Transformation
Procure-to-Pay Recommendations
  • Centralize the receipt, mailing, sorting,
    scanning, and imaging of all PO and non-PO paper
    invoices received from vendors and grantees
  • Process PO-related invoices according to current
    three-way match business rules unless blocked. If
    exceptions are found in three-way match, invoice
    is blocked in SAP and sent via workflow to Agency
    PO Line Item Reconciler for resolution
  • Route Non-PO invoices (including grants) to
    agencies to provide appropriate account
    information and approval. Once coding is entered
    and approved, a document to be created in SAP and
    sent via workflow to PO Invoice Processing group
    for review, approval, and payment
  • Phase in non-PO invoice processing between May
    and September 2009
  • Use special process for Utility invoices that
    allows agency to view image, enter account
    assignments and select payment (advancement
    account, p-card, via treasury)

Invoice Processing
Procure-to-Pay Recommendations (contd)
  • Use exception processing workflow to agencies and
    return of documents to Comptrollers for PO
    invoice processing
  • Require all purchase requisitions to be reviewed
    by agency fiscal staff
  • Implement risk-based approach for comptroller
    involvement in service solicitations
  • Eliminate Comptroller involvement in reviewing
    approved agency service contracts based on
    involvement in solicitation process
  • Change thresholds for PO review and approval from
    5,000 to
  • 20,000 for PO against DGS statewide and agency
  • 10,000 for all other PO types
  • Increase use of Purchasing Card Program by adding
    DGS contracts that accept p-card to SRM. Enhance
    the reporting and posting capabilities

Procure-to-Pay Recommendations (contd)
Anticipated Agency Benefits
  • Faster payment to vendors
  • Ability to track and monitor invoices from the
    point of receipt through payment completion
  • Reduce errors or incorrect postings involved in
    processing, as entry will be made at the agency,
    allowing flexibility based on fund changes
  • Decision on payment mechanism can be made at the
    agency (e.g., advancement accounts)
  • Agency confirmation of changes more prompt and
    accurate due to familiarity with the facilities
  • Significant staff time currently dedicated to
    exceptions processing for marginal amounts or
    other minor non-matching issues can be redirected
    to other value added activities
  • Agencies become more empowered as end users in
    accordance with Commonwealth procurement policy

Procure-to-Pay Recommendations (contd)
Anticipated Agency Impacts
  • All paper invoices - Will no longer receive paper
    invoices at the agency. Will receive an image of
    the invoice for processing.
  • Non PO invoices - Enter data into system rather
    than manually recording on the paper invoice.
    Invalid entries will not move forward for
    processing. Every agency will be responsible for
    identification of staff who will be invoice
    receivers and verifiers and delivering the
    training to these staff (materials for training
    will be provided by the project).
  • PO invoices - Blocked PO invoices will be work
    flowed to agencies for exception processing.
    This will require communications and job aides
    for all line item reconcilers in agency.
  • Procurement - Workflow will require agency fiscal
    staff to review/approve purchase requisitions to
    ensure proper coding
  • Interfaces for payment currently no anticipated
    changes but analysis still in process

Financial Transformation Project Recommendation
  • Shopping Cart Approval Requirement
  • Fiscal officer approval regardless of dollar
  • Options discussed
  • Create special role for Agency Fiscal
  • Allow agencies to rework existing workflow
  • Decision Use existing workflow
  • Analysis by agency
  • Discuss with user group during Dec 10th 2008
  • Meet with agencies as needed
  • Must be implemented by May 2009

MBE/WBE Utilization
Role of BMWBO
  • Promote contracting and subcontracting
    opportunities for Disadvantaged Businesses

Procurements with Deminimus Disadvantaged
Business (DB) Participation
  • BMWBOs Evaluate submitted proposals as they
    relate to DB utilization and provides the agency
    with scores.

BMWBO provides a memo to user agencies along with
DB scores
  • Memo states if certain vendors are selected which
    have been identified as having deminimus
    participation BMWBO is to be notified of such
  • BMWBO will evaluate best and final offers (BAFOs)
    as they relate to DB utilization and provide the
    agency with revised scores

BMWBO Example of Memo
  • DATE November 29, 2008
  • SUBJECT Notification of Unsatisfactory
    Disadvantaged Business Participation
  • RFP DPW-00000000000
  • TO Casey Miller
  • Department of Public Welfare
  • FROM Kathryn Waters-Perez, Director
  • Bureau of Minority and Woman Business
  • The Bureau of Minority Women Business
    Opportunities has received the Disadvantaged
    Business Participation submittals received in
    response to the RFP. The explanation for the
    scoring is found on the attached.
  • The following Proposers provided submittal with
    unsatisfactory or zero DB participation
  • Company ABC
  • Did it Wrong, Inc.
  • Should your final evaluation result in selection
    of one of these Proposers for contract
    negotiations, BMWBO must be immediately notified
    and given an opportunity to work with you in
    attempting to increase DB utilization for this
    contract. BWMBO should be invited to participate
    in contract negotiations in an effort to increase
    Disadvantaged Business Participation. Please
    contact me before initiating any contract
    negotiations with the selected offeror.
  • Following contract negotiations and the contract
    being executed, the Disadvantaged Business name,
    address and amount of commitment made by the
    contractor must be forwarded to us.

  • Contract Negotiations
  • If necessary, BMWBO will negotiate any changes in
    DB utilization as a part of pre-selection and/or
    contract negotiations when DB participation is

BMWBO Contact Information
  • 611 North Office Bldg.
  • Harrisburg, PA 17112
  • (717) 783-3119
  • E-mail RA-rfpbmwbo_at_state.pa.us
  • Procurement Liaison
  • Gayle Nuppnau
  • (717) 346-3819
  • E-mail GNuppnau_at_state.pa.us

Materials - Fuels
  • Liquid Fuels
  • Current Contract Structure
  • Bid differential price (margin, transport) by
  • Commodity price floats on daily index
  • Two methods of delivery by county truck
    transport for over 5000 gal., tank wagon for
    under 5000 gal (Just Discussed).
  • Disadvantages
  • Manages only small portion of our total unit cost
    (approx. 5)
  • Full exposure to the daily volatility of the
  • Provides little control over drastic increases in
  • FY 04-05 19.5 million
  • FY 05-06 25.9 million
  • FY 06-07 38.0 million
  • FY 07-08 44.7 million
  • Daily price changes cause frequent invoice
    payment problems

Materials - Fuels
  • Full Truck Transport Strategy 5000 gallon plus!
  • Working through suppliers we plan to lock fuel
    purchases for large users through NYMEX.
  • Approx. 40 of end use customers nationwide use
    this strategy.
  • Bid differential price, then make commodity buys
    when price is advantageous.
  • Can make buys for front month or several future
    months if prices are attractive.
  • Target buy is 50 of volume for largest volume
    truck transport users and average up or down
    based on spot market.

Materials - Fuels
Truck Transport Strategy- 5000 gallon plus.
  • Advantages of fuel hedging strategy
  • Gain control of total commodity cost
  • Reduce market exposure and variability.
  • Smooth out large spikes in pricing.
  • Can use this strategy to buy incremental
    components of usage, reduces risk.
  • Diversified Portfolio of fuel purchase
    quantities and prices.
  • Flexibility to purchase one or multiple months of
    usage when market prices reach low
  • BOP will do the POs, will provide higher quality
    usage data, visibility of delivery frequency.
  • DGS will make payment to vendors via P-Card and
    cost allocated back to Agency when the card is

Materials - Fuels
  • Small Fuel Delivery Program
  • We have many small tanks (500 gal. or less)
    located in remote areas.
  • Suppliers bite off more than they can chew,
    causes problems with on-time deliveries.
  • Limits supplier base, discourages new entrants.
  • Invoice Payment problems.
  • Recent Petroleum past due balance of over 1.25
  • Vast majority of invoices less than 5000.
  • GR entry problems.
  • Supplier confusion.
  • Those who receive deliveries closer to 5000 gal.
    and/or pay bills on time subsidize those who

Materials - Fuels
  • Small Fuel Delivery Program
  • ITQ Contract for deliveries less than 5000 gal.
  • This is a contract of convenience.
  • Qualify suppliers by county.
  • Agencies follow procurement procedures based on
    low dollar amount.
  • Agencies obtain Small Procurement Policy and
    obtain quotes from qualified suppliers in county,
    select best price.
  • Invoicing
  • Quoted prices firm, less potential for errors.
  • Mandated utility card use for orders under 5000
    should remove bulk of past-due payment issues.

Contract Update
Contract Number Contract Title Status Commodity Manager Material
440003137 Medium Duty Trucks In Award Process Craig Wolford Work Trucks
4400003207 Road patching Equipment In Award Process Craig Wolford Kettles, patchers, Reheaters
2550-02 Diesel Engines To be Renewed Craig Wolford Engines
6675-02 Surveying Equipment To be Renewed Mary Randolph Surveying Equipment
4400001174 Floor Polishers In Award Process Mary Randolph Floor Polishers and Vacuums
4400001741 Wheelchairs To be Renewed Mary Randolph Wheelchairs
3930-01 Forklifts Bidding Currently Craig Wolford Lifts
7350-05 Commercial Food Equipment Bidding Mary Randolph Commercial Food Equipment
New Police Lighting and Accessories Bidding Craig Wolford Accessories for Police
Contract Update
Contract Number Contract Title Status Commodity Manager Material
5610-49 Cement In Award process Joel Shiffler Cement
5684-02 Corrugated metal Pipe In Award Process Joel Shiffler Pipe
5610-36 Bituminous Plant Mix Bid being prepared Joel Shiffler Plant Mix
5710-01 Bituminous Liquid patch Bid Being Prepared Joel Shiffler Liquid Plant Mix
4600010918 Sign Stiffeners Renewed Joel Shiffler Sign Stiffeners
4400003307 Rock Salt Bags Approved Joel Shiffler Bagged Salt
NEW Fuel Management In process Joel Shiffler Fuel Additives
4400002702 Energy Mgt Services ITQ Joel Shiffler Electricity, natural gas
9140-01 Heating Oil 2 Award in Process Joel Shiffler Oil
9130-03 Unleaded gas Award in Process Joel Shiffler Gas
Contract Update
Contract Number Contract Title Status Commodity Manager Material
9140-08 Liquid Fuel Award in Process Joel Shiffler Fuel, Large Volume
9140-02 Heating Oil 4 Bid in Progress Joel Shiffler 4 Heating Oil
4400003333 Waste Oil Awarded Joel Shiffler Waste Heating Oil
440003238 Carpet Awarded JP Duvall Carpet
8415-01 Gloves Awarded JP Duvall Gloves
4400002988 VWR MISC LAB Equip Awarded Jim Pinci General lab Equip not covered by 4600012524
4400002959 Detection Equipment Awarded Jim Pinci Testing Equipment for Atomic, Chemical, Biological Material
4600013480 Janitorial Awarded Jim Pinci Consumables and paper Product
Shared Services - Roles Responsibilities
  • BOP-003 Delegation Request (Updated)
  • APPROVALS The agency is responsible for
    obtaining any approvals required due to the
    nature of the material or service or both being
    procured, in addition to compliance with any
    applicable Management Directives, Information
    Technology Bulletins and/or Commonwealth policy.
  • Method of Procurement ? RFP ? IFB ? ITQ-RFQ
  • BOP-003_REV._10-2008

Shared Services - Roles Responsibilities
Denied Delegations Roles Responsibilities
IT Procurements
  • IT Contracting Office
  • Consistent with Executive Order 2004-8, the
    Office of Administration has established the IT
    Contracting Office (ITCO).
  • Three attorneys will oversee the legal aspects of
    all IT project procurements that fall within the
    COP process.
  • Nora Doyle -General Government Operations
    Public Safety
  • Sonja Zucker - Environmental
  • Crystal Fox - Health Human Services

IT Procurements
  • Primary Functions of IT Contracting Office
  • Providing guidance related to the proper
    procurement method for IT Services.
  • Establish training programs for DCIOs, the CIOs
    any agency personnel who wish to participate.
  • During the procurement process, documents will be
    provided to ITCO through the DCIO in conjunction
    with the COP review.
  • Review documents related to RFQs and RFPs prior
    to posting
  • During contract negotiations they will work with
    the issuing office to ensure requirements, terms
    conditions and service level expectations are
  • At the request of an agency they will review
    software licenses and advise agencies related to
    general IT matters.

IT Procurements
  • DGS will assist agencys in meeting the project
    timeline developing procurement strategy and
    preparing the final RFP documents receiving
    proposals facilitate the evaluation lead the
    negotiation team and processing the necessary
    documents for the contract award.
  • All these activities are joint efforts that will
    be heavily influenced by the Office of
    Administrations and the Agencys expertise and
    experience as the administrator of their current
    contract. DGS will not participate as a voting
    member of the technical evaluation committee.
  • After the contract is successfully awarded, the
    Agency will retain responsibility for managing
    the contract with the awarded supplier, including
    contract maintenance, administration of the
    contract, including ensuring delivery of expected
    savings and/or service improvements and
    contractual obligations, leverage and focus
    supplier capabilities, ensure rapid resolution of
    issues and provide consistent direction to the
  • DGS should be informed of any contractual changes
    necessary or if the supplier defaults their
    contractual obligations to the Commonwealth.

Enterprise ITQ System
  • Enterprise ITQ System Phase 1 to be complete by
    Jan. 2009
  • Phase 1 ITQ Administrators can get into the ITQ
    and create ITQ contracts, and that Suppliers can
    register (or use their SRM registrations) and
  • Phase 2  ITQ administrators can get into the ITQ
    and evaluate the Suppliers applications, and
    approve or deny the applications, and supply any
    ancillary functionality that works with the Phase
    1 functionality but was not vital to Phase 1.
  • Phase 3 Local Municipalities and Agencies can
    get into the ITQ and use the supplied
    functionality to find Suppliers that can perform
    the jobs that the Local Municipalities and
    Agencies need, and supply any ancillary
    functionality that works with the Phase 2
    functionality but was not vital to Phase 2.

  • IT ITQ Expires June 2009
  • OCT 2009 Finalize TCs with suppliers
  • NOV-DEC Review new IT ITQ with Suppliers and
    Tech Council
  • JAN 2009 Allow suppliers to begin qualification
  • JAN 2009 New ITQ web site available (proposed
  • APR 2009 Begin issuing RFQs under new IT ITQ
  • JUN 2009 End all work under old IT ITQ
  • For work slippage only
  • Can go past end of contract by 90 days
  • Needs DGS approval
  • JUL 2009 New ITQ effective date

  • WSCA Cell Phone Contract
  • Implemented
  • Met with TMOs on details
  • Moving to shared minutes
  • Suppliers gave TMOs presentation of
  • What procedures will be available?
  • PCs, Laptops, Rugged Laptops and Thin Clients
  • All punch-out sites up and running, all contracts
  • Dell Lease Payments
  • Professional AV
  • Multiple award contracts
  • Peripherals Networking
  • 2 suppliers on Peripherals
  • Recommend to get 2 quotes on orders over 2500
  • Web Sites to be fully functional in next 30 days
  • P-card enabled
  • Networking is multiple award
  • Servers Storage
  • Interim Agreement in Place, pending approval

  • New Procurements in Process
  • 3rd Party Maintenance
  • Enterprise IT Help Desk
  • Enterprise Software (3 companies)
  • Film and sundry supplies
  • IPAM
  • Time Management
  • Radio Repair and Equipment
  • E\Procurement Policy Council Meeting\PPC_October.
    29.2008_docs\IT Contracting Office10.08.pdf

Agency PO/Contracts Background
  • Issue Inconsistent interpretation of MD 310.3
    within comptrollers- Encumbering and Lapsing of
    Appropriations following the implementation of
  • Background Prior to SRM, agencies created the
    following document types to commit funds
  • Agency Standard Contract with follow on PO.
    (contract no commitment, PO commitment)
  • Agency Encumbered Contracts with follow on PO.
    (contract no commitment, CO creates a funds
    reservation entered into the contract, and a PO
    to commit with manual reduction of the funds
  • Multiple year or single year PO. (PO commitment)
  • Due to the multiple step process and room for
    error, the Agency Encumbered Contract document
    type was eliminated with the SRM implementation.
    Agencies were given the option of a contract with
    POs or multiple year POs to encumber funds.
  • Inconsistent interpretation of the MD
  • Perception by CO is that funds must be encumbered
    at the time of award and only means to do so is
    via the PO as contract does not trigger
    encumbrances. Certain offices require a contract
    and single year POs to be created for every year
    of the contract immediately upon award.
  • Question/issue Why create the contract if all
    POs have to be created at same time? Defeats
    purpose of contractextra work.

Agency PO/Contracts Responses
  • Contacted several agencies to see how they
    processed ongoing services contracts.
  • LI Creates multi-year purchase orders.
  • DPW Creates agency contracts for some services
    that are purchased on an as needed basis. For
    ongoing services, multi-year purchase orders are
  • PSP Creates multi-year purchase orders. They
    know their budget for future years, but dont
    want to create a contract, then cut a PO every
    year. They would rather cut one PO for the full
    term so they dont have to remember to create a
    new PO in each consecutive year.

Use of Agency Contract
  • Recommended Decisions for Document Types
  • An agency contract was to be created when
  • More then one entity was purchasing off of it ,
    i.e. districts creating their own POs at time of
  • Agency cannot commit the future year funds or are
    not ready to commit the funds.
  • then create a PO at the time you are ready and
    another one thereafter
  • Requirements (materials or services) quantity and
    timing unknown or uncertain over future years
  • A multiple year PO was to be created when
  • The agency wanted to commit all funds at time of
    the award

  • Scenario 1 - Intergovernmental Agreements (IGA)
    for services mandated to be provided that will
    continue for the next several years, but because
    they are contingent on State funding, the exact
    amount to be allocated may not be known years in
  • IGAs currently take 6-8 weeks for approvals in
    SRM and because some of the work must be done
    when school is not in session, agency cannot
    afford a lapse in services at the start of the
  • Solution - Multiply a single year times 5 and
    enter an agency contract for 5 years with an
    annual PO to establish exact funding done
    immediately at the start of the new FY. With
    this scenario, there would not have a lapse in
    services and when a PO is issued, would only have
    Comptroller to approve instead of the original
    6-8 weeks for full IGA.
  • Scenario 2 - Purchase of educational materials
    (curriculum) where it is known there will be a
    multiple year need for the item(s) plus
    instructional services but do not know exactly
    how many schools would be serviced each year as
    it would be contingent on the annual budget
  • Solution - Manage this with a handful of
    contracts, not the much higher number we would
    use for IGAs. In this case, again, it would
    prevent a lapse of services and allow agency to
    cut a timely purchase order without risking a
    lengthy break in services. Even though these
    contracts would only have three or four approvers
    (based on cost) instead of the six with IGAs,
    consistently run into the backlog in many of
    these offices as we try to push through the new
    purchase orders. This would reduce everyones
    workload as the PO would only go to Comptroller.
  • If any one of the agency contracts prove to be
    too small, could amend to add services or
    quantities mid-FY cycle so as not to risk the
    break in services at year end.

Contract Attachments
  • This list of required attachments was created to
    assist in maintaining the correct documents
    within contracts. They were derived based on
  • Minimum Right to Know requirements
  • SRM compatibility

IFB Contract Attachments (Multi Award Hierarchy Contract) Electronic Bid utilizing doc builder eMarketplace Internal File IFB Contract/Purchase Order Attachments Electronic Bid utilizing doc builder eMarketplace Internal File
RFP Contract Attachments (paper submittal not using doc builder) SRM eMarketplace Internal File RFP Contract Attachments (using doc builder) SRM eMarketplace Internal File
Contract Attachments Location Contract
Attachment Documents
Procurement Handbook Changes
Non-contract purchases under 10K (reinstated)
  • Part I Chapter 7 Thresholds and Delegations
  • Section B Thresholds for Specific Procurements
  • Agencies are authorized to procure on a non bid
    basis, up to 10,000 for the following
  • Repair, maintenance, modification, or
    calibration of equipment services to be performed
    by, and repair parts supplied by, the
    manufacturer of the equipment or by the
    manufacturer's authorized dealer
  • Software license maintenance agreements and
    extensions of software licenses
  • Agency leasehold construction improvements

Complete Procurement Handbook Changes
Political Contribution Letter for Sole Sources
Relating to the PO or Contract issued to the
Supplier, a Political Contribution Letter is to
be sent to the supplier reminding them of their
responsibility to file a report of Political
Contributions, by February 15 of each year. This
report is to be sent to the Secretary of the
Commonwealth for all political contributions
exceeding 1,000 during the preceding year.
Sole Source Procurements of Materials,
Services and Construction.
70 Thresholds
Part I, Chapter 6 Methods of Awarding
Contracts In order for a proposal to be
considered for selection for BAFO or selection
for contract negotiations, the total score for
the technical submittal of the proposal must be
greater than or equal to 70 of the highest
scoring technical submittal.
Procurement Handbook Pending
BMWBO Changes
  • Part 1, Chapter 3 Responsibilities
  • Currently, the agency evaluates the STD-168 over
  • At any dollar amount, an STD-168 MBE/WBE
    Subcontractor and Supplier Solicitation form,
    will be sent to the supplier to complete, sign
    and return to the agency.
  • - The agency will evaluate their responsibility
    for a value of up to 50K and BMWBO will review
    if the contract is over 50K.
  • Part 3, Chapter 7 Competitive Sealed Proposals
    (RFP Process)
  • Will read the same as Part 2, Chapter 7
  • BMWBO assigns the minimum weight for DB
    participation at 20 of total points
  • Agency establishes a maximum point value for
    each major evaluation criterion prior to RFP
  • - Cost criterion must be a minimum of 30 total

Procurement Handbook Pending
BMWBO Changes
Part 1, Chapter 20 Non Discrimination Currently
the Form GSMWBE-16 is completed only on
construction contracts. They will be needed for
any contract over 50K. - The Form GSMWBE-16,
"MBE/WBE Subcontractor and Supplier Certification
Solicitation and Commitment Form", is to be
included in contracts with sole source
contractors when the total procurement is
estimated to be more than 50,000 annually for
single or multiple year awards. The contractor
must complete Form GSMWBE-16. - Before
processing a contract in the amount exceeding
50,000 (or such higher amount as BMWBO may
establish for a particular agency), including
those amendments and change orders that directly
affect MBE/WBE participation, the purchasing
agency is required to forward the
bidder-completed GSMWBE-16 to BMWBO which will
determine the contractor's responsibility in
regard to nondiscrimination unless exempted from
the BMWBO Program requirements. - If BMWBO
determines the contractor is nonresponsive and/or
not responsible, and the agency decides to make
an award, the agency must consult with its Office
of Chief Counsel, and its agency head or
appropriate Deputy Secretary and fully justify,
in writing, its reasons for proceeding with
award. The agency must forward a copy of this
justification to BMWBO. Part 2, Chapter 3
Delegated Formal Competitive Sealed Bidding -
This section of the Handbook is under review to
eliminate the need for agencies to send
solicitations to suppliers. BMWBO will require
suppliers to provide an email address so that the
supplier can receive Ealerts.

Procurement Handbook Pending
Modifications to Document Builder MBE/WBE
The following issues are being addressed - List
the number of documents required - Link to BMWBO
RFP Template
  • Part 1, Sections 12 and 13 will update the
    phone, fax and website for BMWBO
  • Part 1, Section 19 will address confidential
    information and the Right To Know requirements
  • Part 2, Section 9a revises the number of
    Disadvantaged Business submittal copies to 2
  • Part 3, Section 4 adds the 70 rule for
    technical proposals, language to disclose the
    weights for technical, cost and Disadvantaged
    Business scoring and bonus points
  • Part 4, Section 6 adds through any renewal or
    extension of the contract
  • Appendix B Domestic Workforce Utilization
    Certification form was revised
  • RFP Template

Archiving templates from DGS website

- Templates commonly found on the DGS website are
being archived to allow agencies to find
templates from prior years - DGS templates only
will be saved - Agencies are recommended to
archive their own agency specific documents -
Templates can be found at PUForms/ArchivedForms
Procurement Handbook Pending
Publishing RFP Weights
  • It is DGS intention to publish RFP weights
  • Using this process makes debriefings easier and
  • Suppliers cannot claim the scoring
    weights/criteria were inappropriate, as they were

- Developing a new chapter on Department of
Treasury which will include Right To Know
Green Procurement
Part 1, Chapter 22 Green Procurements -
Currently drafting policy on Environmentally
Preferable Purchasing - Developing tools and
website resources along with training -
Identifying 3-5 commodities for pilot projects
Procurement Handbook Pending
Part 1, Chapter 1 General Provisions -
Clarifying the scope surrounding subscriptions.
GSA Schedules
- There are schedules (contracts) available from
the Federal government - They are used on a
limited basis - DGS will be reviewing policy to
allow limited usage of GSA Schedules - Establish
DGS as a initial checkpoint prior to
purchase www.gsa.gov
Requisition Pricing
  • Purpose
  • Some agencies are occasionally changing the Do
    not adopt to As net price setting in the Line
    Item Details section of an R3 requisition.
  • Changing Settings
  • Requisitioners should not change the valuation
    setting of Do not adopt.
  • This setting is necessary so that contract
    pricing is maintained throughout the documents.
  • When a requisitioner pulls up a contract item,
    the correct price will be pulled into the

Bidding Guide
  • To create your bid
  • Go to www.pasupplierportal.state.pa.us
  • Go to Supplier Log On
  • Select Bidder Tab
  • Select Process Bids
  • Locate Bid Opportunity
  • Select Create Action Icon
  • To complete your bid
  • Go to General Data Tab
  • Select Attributes and respond to all
  • Add Attachments by selecting Browse locate
    file upload by selecting Add
  • Enter Price
  • Submit the Bid
  • The Submit button will not be available until
    the Check button is invoked.
  • To delete a bid completed incorrectly
  • 1.Search for previously submitted bid. Once it
    appears, click the pencils for Change mode
  • 2. Select the Hold button
  • 3. Select the Change button, Delete button
    should appear
  • 4. Select the Delete button
  • Support Options
  • Live Support exists for suppliers available via
    the Customer Support Center
  • Email ra-srmhelp_at_state.pa.us
  • Phone 717-346-2676 (local)
  • Phone 877-435-7363(outside Harrisburg)
  • www.pasupplierportal.state.pa.us

Document can be found Bidders Guide - Checklist
for Creating, Responding and Deleting a Bid
Live Auction
  • Live Auction Cockpit (LAC) refers to an auction
    that takes place online in real time via the
    SRM portal. Live auctions are held to get the
    best available market price at the time of the
    bid. Throughout the bidding process the price is
    driven down, which often results in a lower price
    paid than traditional sealed bids or
    negotiations. A matrix is available for use which
    will allow a user to decide if Live Auction is
    the right tool.

DGS offers this service to agencies To access the
EUP Live Auction EUP
Live Auction Decision Tool
The Decision Tool is utilized to determine the
viability of performing a Live Auction.
Why conduct an Auction?
  • To get the best available market price at the
    time of the bid
  • Auctions drive down costs, often resulting in a
    lower price paid than traditional sealed bids or
  • Real cost savings of 10 or more can be realized
  • For example An item which is purchased in a
    significant quantity, and there is pricing
    flexibility in the market
  • To improve and streamline the strategic
    e-procurement process
  • Precise specifications will be provided to
    potential suppliers
  • Historical spend data can be used to develop
    business forecasts
  • Negotiation time is reduced from weeks to minutes
  • Auction events are easily duplicated
  • Auction events are visible and the results
  • The live web-based event is viewed in real time
  • SRM reporting offers detailed analysis across
  • Increased competitiveness within the public
  • Ongoing cost reductions and improved productivity
    are essential in government activities
  • Results and benefits are measurable and easily
  • Many suppliers appreciate the openness of auctions

Three Auction Profiles used by DGS
Material Requirements Planning Overview
  • Purpose of todays overview
  • Provide an understanding of MRP its use
  • Provide information for use when making
    purchasing decisions
  • Clarify misconceptions regarding the methods of
    procurement for inventory

MRP Transactions in R3
Inventory MRP Facts
  • MRP use is limited for the Commonwealth
  • MRP Process Plans, Creates Planned Orders,
    Converts Planned Orders into Requisitions, and
    Creates Purchase orders
  • Takes into consideration such things as re-order
    point, prior and future consumption,
    replenishment, lot size, lead-time and use
  • In order to use MRP an agency must have an
    established MRP Controller, Inventory Planner,
    and material masters set up for MRP requirements.
  • Material masters should be listed as contract
    line items when a statewide or agency contract is

MRP does not simply mean an order for
inventory - MRP is a process -
Process Flow - Inventory via MRP
Inventory Purchases
  • There is a misconception that SRM cannot be used
    to order inventory items SRM can be used to
    order inventory
  • Many contract replication requests use the
    justification MRP
  • 4600010375 with Hershey Creamery for Ice Cream
  • Only Corrections ordered for inventory and POs
    were not generated through MRP
  • No need to maintain contract in both places
    should be SRM only
  • R3 Document type NNB New Standard PO

SRM for Inventory
  • SRM can be used for inventory purchase orders not
    procured via the MRP process
  • After the product ID (material master) has been
    entered the Order as Direct Material indicator

If non-valuated, use normal process - account
assignment is required
High Level Process Flow - Inventory Non-MRP
SRM CSC Background
  • SRM Customer Support Center (CSC)
  • Operated by DGS Bureau of Procurement (BOP)
  • Established in Aug 2006
  • Created to provide interim support during and
  • go-live SRM implementation
  • Provides two separate services
  • Supplier Registration and Support
  • SRM Agency Support

Current CSC Flow
Call Volume From Agencies
  • CSC SRM Agency Support
  • Averages 403 Automated Call Distribution (ACD)
    calls per month (93 per week)
  • Approximately 20 are not answered due to
    conflicting priorities

Other Influx to CSC
  • Incoming calls directly to Commodity Specialists
  • Average 50 per week
  • Remedy Tickets
  • Average 28 per week
  • Emails to SRM Resource Account
  • Average 20 per week
  • Additional time needed to research issues
  • Average 25 hours per week

Initial Agency Inquiries
  • Original types of inquiries received from
    Agencies by CSC were SRM related
  • How do I set my attributes?
  • How do I enter ship to addresses?
  • I cant find a vendor.
  • How do I create a shopping cart?
  • What is a product category?
  • How do I reference a contract?

Current Agency Inquiries
Agency Assistance
  • Agencies can reduce the number of inquiries to
    the CSC by
  • Limiting inquiries to only those related to CSCs
    core mission ? SRM questions only
  • Call Commodity Specialists directly for sourcing
  • Encourage procurement professionals to utilize
    the Self Service Resources
  • End User Procedures
  • SRM Website FAQs, AIT Library, Resource Guide
  • eNews
  • Encourage associates to take advantage of the
    various Procurement Training Programs offered by

Password Reset
  • Password Reset Login Screen
  • Suppliers insert user name in Logon ID.
  • Suppliers click on Reset Password.
  • Password reset e-mail comes from
  • ra-srmhelp_at_state.pa.us. (Recommend checking
    SPAM settings.)

SRM Core System
  • Support Packs
  • What is a Support Pack?
  • Support packs contain all the current fixes
    from SAP in one bundle rather than applying
    individual notes on an as needed basis. 
  • Support packs normally fix things, but on
    occasion may create a problem. 
  • IES will do testing of the Support Packs
  • All changes as a result of the support packs
    should be found at this time and IES will
    communicate this information to the agencies.
  • If end users notice anything different in the
    core or SRM systems once the support packs are
    put into production they should report the issue
    through the helpdesk/remedy ticket process.
  • Tentative Schedule for Latest Support Packs
  • Development - November 10, 2008
  • Quality - November 17, 2008
  • Production - December 6, 2008

SRM Core System
  • Upgrades
  • ERP 6.0 Upgrade
  • Effects all systems including ESS
  • Cut-over dates for system unavailability
  • PA Supplier Portal Thursday, October 30th 500
    PM thru Monday, November 3rd 600 AM
  • MyCommonwealthWorkplace Friday, October 31st 
    400 AM thru Monday, November 3rd 600 AM
  • .xml Supplier Transmittal of Invoices Thursday,
    October 30th 500 PM thru Monday, November 3rd
    600 AM
  • Screen change document
  • Handout
  • Sent via eNews on 10/22/08

SRM Updates
  • Guid Error Public Advertising Supplier
  • The contact information for the public
    advertising supplier was deleted from the vendor
    record in error 
  • This caused a Guid (Globally Unique Identifier)
    error on bids created prior to 8/12/08 using the
    public advertising supplier 
  • This error is undetectable until workflow is
  • This error is uncorrectable 
  • Resolution
  • The public advertising supplier record was
  • Do not reuse or copy a bid created prior to
  • Create a new bid

Supplier Enablement - ERS
  • Evaluated Receipt Settlement (ERS)
  • A shortened, easier process to pay suppliers
  • Upon receipt of order receiving agency enters GR
  • Overnight process generates an electronic invoice
  • 2-way match PO quantity GR quantity
  • Treasury processes payment via ACH
  • Eliminates need for issuing and processing
  • No action is needed by the comptroller
  • Turnaround time for payment is reduced
  • Goods Receipts must be accurate and timely!
  • Failure to enter GR Supplier will not be paid
  • Late entry of GR Supplier payment will be
  • Incorrect GR entry Supplier will be paid an
    incorrect amount and purchasing agency must
    process a credit memo

Supplier Enablement - ERS
  • Evaluated Receipt Settlement (ERS) - Pilot
  • Cut over date - September 10, 2008
  • Suppliers
  • Todd Heller, LLC -Contract 4600013343 Glass Beads
  • Ennis Paint, Inc. Contract 4600010851 Traffic
    Line Paint
  • Agency Transportation
  • Current activity 4 POs were created and 5
    payments successfully processed
  • End of paint season not much activity
  • Investigating expanding the pilot to include
  • Calcium Chloride
  • Rock Salt
  • Corrugated Boxes

Assignment of Payments in SRM
  • Method for assigning payment on invoices related
    to SRM-generated POs to an Assignee rather than
    the Assignors default remit-to address.
  • CVMU creates a 902 Partner Record within the
    suppliers master data.
  • To request a 902 Partner Record - purchaser
  • Complete 902 Partner Record Request form (found
    under Procurement Forms on the DGS website)
  • Request must include the following info
  • Complete name and address of Assignee
  • Vendor number of the Assignee
  • Signed letter from the Assignor documenting the
    assignment of payment
  • Must be on Assignors letterhead
  • Multiple Assignees require separate request forms
    for each
  • Submit documents to CVMU Resource Mailbox at
  • If approved, the Partner Record will be created.
    If disapproved, the form will be returned to the
    requester with the reason for rejection.
  • EUP is available on the DGS website 902 Form
  • 9/18/08 eNews

Procurement Connection Group
  • Objectives
  • Provide information and guidance to agency users
    on current and future procurement related
  • Provide support in resolving issues relative to
    procurement functions.
  • Give agencies an opportunity to offer input into
    DGS procurement projects and contracts.
  • Provide a forum for agencies to have open
    discussion on issues that are affecting them and
    how they do their business and will allow for
    sharing of ideas and individual agency successes.
  • Schedule
  • First meeting held Wednesday, October 15, 2008
  • Meetings will occur every 8 weeks
  • Agendas
  • Agencies are encouraged to submit agenda items
    for discussion.
  • Meeting notices will be sent requesting agenda
  • Opportunity for smaller group discussions on
    specific topic areas
  • Agenda items can be submitted any time
  • Submit to Cheryl Kleeman via email -

eMarketplace Updates
  • Procedure for Simplifying Contract Search in
  • Has been added to Tips Tricks under the
    Help section on eMarketplace

eMarketplace Updates
eMarketplace Updates
A list of all contracts will display by Parent
Number, Description, and Ending Date. You can
sort by any of these fields by selecting the word
at the top of the column. You can search for
your contracts here, or Export to Excel for
easier sorting and searching capabilities.
eMarketplace Updates
  • Contracts fitting your criteria will be
    highlighted on the spreadsheet as shown below.
    To view the vendors contracts for that parent
    contract,select the highlighted numbers under
    the Parent column.

eMarketplace Updates
  • This will take you back into eMarketplace and
    display a list of contracts that belong to the
    Parent contract you selected.

eMarketplace Updates
  • Tabulation Award Information
  • Agencies may elect to post solicitation
    tabulations award information to eMarketplace
  • Instructions will be sent via email to the PPC
    and all registered users on eMarketplace
  • Instructions on how to upload these documents on
    eMarketplace will be added to the EUP created by
    the Training Section the Help section on

eMarketplace Updates
Solicitation Tabulations Required information
for input
eMarketplace Updates
Awards Required information for input
eMarketplace Updates
  • Sole/Single Source Section
  • Secretarys initiative to have sole/single source
    information public
  • New section to be added to eMarketplace
  • Source Justification Form will be a web-based
    form with routing approvals
  • Specific information will be made public (will
    review info on another slide)
  • Seeking agencies to volunteer to assist us in
    testing before go live

eMarketplace Updates
Procurement Description will appear for public
eMarketplace Updates
eMarketplace Updates
eMarketplace Updates
eMarketplace Updates
Quality AssuranceProcurement Review Background
  • As part of the Financial Transformation (FT)
    Project Comptroller Operations (CO) is in the
    process of redefining many core functions. While
    they will remain a part of procurement document
    review, their role will transition to more of a
    financial focus vs. a comprehensive and all
    inclusive review of procurement documents,
    solicitations and contract processes.
  • Future State
  • Selective review
  • More post audit vs. 100 inspection prior to
    document release
  • Focus more on financial aspect vs. procurement
  • This change in roles and responsibilities places
    increased accountability on agency procurement
    personnel to
  • Ensure accuracy and compliance upon document
    creation, transactions performed, as well as
    oversight of the procurement process.

Future State with Quality Assurance
Procurement Review
BOPsQuality Assurance Procurement Review
  • As the lead procurement agency responsible for
    policy, systems and processes, Bureau of
    Procurement (BOP) should assume an increasing
    role formerly managed by CO.
  • Title 62, Chapter 3 Section 11, of the
    Pennsylvania Consolidated Statutes, allows the
    Department of General Services (DGS) to monitor
    the implementation of its regulations for the
    procurement of all supplies, services and
    construction by Commonwealth agencies.
  • Policies and Procedures are stated in the DGS
    Procurement Handbook.

  • Massachusetts, Texas, South Carolina and
    California have programs established to assess
    procurements made by their state agencies.
  • BOP intends to establish a Quality Assurance
    Procurement Review to ensure compliance and offer
    assistance to agencies.

Process Cycle
BOP Conducts Procurement Review
Agency Develops Implements Corrective Actions
BOP Agency Review Findings
Identify Opportunities for ImprovementPolicies,
Procedures, Systems Training Requirements
Quality Assurance Review Process
  • Document Site Visit
  • Record Rankings
  • Finalize Summary Package
  • Identify Corrective Actions Opportunities for
  • Identify Candidate
  • Perform Electronic Review
  • Create Agency Outreach Package
  • Set Up Site Visit

  • Implement Changes
  • Stay Current on Changes, Additions, Deletions,
    Modifications to Policy Procedures
  • Review Reports Documentation
  • Evaluate Compliance
  • Complete Review Documents

  • The Intent of the Quality Assurance Procurement
    Review is to
  • 1) Identify the Agencies level of compliance
    with Title 62 and the procurement procedures
  • established by DGS and documented in the
    Procurement Handbook
  • 2) Determine if the procedures stated in the
    Procurement Handbook require clarification
  • 3) Identify agency training requirements
  • 4) Mitigate risk
  • 5) Provide an objective assessment of the
    agencys compliance and the associated risk
  • 6) Assist the agencies with the development and
    implementation of Corrective Actions to
  • mitigate risk
  • 7) Promote compliance by providing continuous
    communications to inform the agencies on
  • new/revised policies and procedures and training

  • Benefits of the Quality
  • Assurance Procurement
  • Review
  • Ensures Compliance with the Procurement Handbook
  • Identifies Opportunities for Improvement
  • Identifies Training Requirements
  • Provides Process and Tools to Manage Change
  • Provides Mitigation Strategies
  • Provides Prevention Strategies
  • Promotes Feedback Mechanism

  • BOP is soliciting for an Agency to participate as
    the pilot, assisting in the development of the
  • Pilot to begin early 2009
  • Contact Paul Wolf

  • Negotiations Course
  • Developed for Commodity Specialist and Agency
    Purchasing Agents.
  • Currently with OA-HRD for articulation.
  • Made available via WBT and administered via E-LMS
  • BW/SRM Course
  • Expanded to Purchasing Agents. A training
    announcement with scheduled offerings will be
    sent to Policy Council Members and Training
    Officers for dissemination in the near future.
  • RFP Process Course -
  • Pilot course scheduled 12/2/2008
  • One day instructor led course.
  • Agencies contacted for plot participation.
  • Mix of DGS/BOP Commodity Specialists and Agency
    Procurement Professionals.
  • Penn State Supply Chain Management
  • 15 Students completed Penn State Program.
  • BOP awarded certificates at recognition ceremony
    in September

Procurement Policy ProcessPurchasing
  • Purpose
  • As business owner BOP has developed formal,
    4-day, ILT to give new and less experienced PAs
    fundamental understanding of COPA procurement
    policies, procedures and processes
  • This classroom training, coupled with practical
    work experience, will raise the standards of all
    COPA Procurement Professionals.
  • It will also establish a uniform knowledge base
    for all PAs, which will reduce inconsistencies
    among agencies and ensure that all purchases are
    performed according to Procurement Handbook
  • As such, the training was determined to be
    mandatory and we will also be requiring
    experienced Purchasing Agents to attend.
  • Recap of Procurement Policy and Processes Pilot
    Course -
  • Session held 9/8-11.
  • Varying levels of experience - few weeks to gt20
  • Thanks for participation and feedback.
  • 10 Students
  • 7 agencies
  • Survey responses were very positive
  • Feedback incorporated into curriculum and
    Knowledge Review
  • Agency Purchasers who are not PAs (ex. AAs and
    AOs) will be able to attend this course.

Procurement Policy ProcessPurchasing Agents
  • Future Training Schedule Location-
  • Conducted on quarterly basis in new BOP Learning
  • 1st sched
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