Officials report that the first phase of California's $617 million financial system overhaul concluded successfully, boding well for future targets.
California’s extensive ERP overhaul is on schedule and under budget, officials report. The 11-year program, called the Next Generation Financial Information System for California or Fi$Cal, will attempt to streamline 2,500 legacy financial systems used across 124 departments. On July 1, project managers announced the first phase of the $617 million project was complete, putting the state on schedule for completion by July 2017.
Fi$Cal's goal is to create a central financial platform for the state that allows fast, easy access to information. With the first phase now complete, the system is being used with a limited feature set by about 10 percent of the state. Subsequent phases will add more users and functionality, Project Director Tamara Armstrong said.
The first phase was focused on the automation of the requisition, purchase order and receipting processes, Armstrong said. The first phase also allowed the state to establish a foundation for much of the work to be done in the four upcoming phases, such as the creation of a statewide accounting and budgeting structure, as well as the beginning of a master vendor file, she said.
The first wave was critical, Armstrong said, because it allowed the Fi$Cal team to become familiar with the business processes used by state agencies, which will help their team as they continue with the project. According to Armstrong, Fi$Cal isn’t just about technology -- it’s also about transforming how work is done in the state.
“Our statewide decision-makers will have better access to information in a more timely manner,” Armstrong said. “The information will be standardized and it will be integrated across the state so we will have visibility at the statewide reporting level that we’ve never had. We will be eliminating redundancies that are performed by control agencies and the department. We’ll be standardizing our processes and obviously that’s going to give us better, more reliable, more accurate and more timely information at many levels in government. So there’s a tremendous savings and efficiencies that are being gained by the state through our integration into a single statewide automated system and the reengineering of our processes.”
Existing processes for data collection are often time-consuming and distracting for workers, Armstrong said. Fi$Cal Executive Partner Sue Johnsrud, former chief operating officer in Gov. Jerry Brown's office, noted that Brown expressed frustration with the inability to quickly uncover spending figures on out-of-state travel. Instead, they had to query each department in the state, and there was no way around it because they needed that information. When this project is fully deployed, that will all be changed, Johnsrud said.
Successfully completing the first phase of the process validated the project’s methodology and shows that the state is on the right track, she added.
In addition to increased transparency, easier reporting and collection of information, and identification of wasteful spending, officials said they anticipate savings through economy of scale purchasing.
So far, the state has spent about $122 million of the projected $617 million total cost, down from an initial $1.6 billion estimate. The savings the state will gain make the project a good investment, Armstrong said.
“In the time when the state is expected to do more with its resources than it ever has, it’s imperative that we leverage processes and tools that allow us to be good stewards of those resources,” she said. “Unfortunately, right now that’s a very challenging process in many ways. Fi$Cal, especially in this time where resources are scarce, is critical not only now but in the future to make sure that we have the information we need to make the best decisions to benefit our constituents.”