Sandy Bowen, Virginia's Secretary of Administration, called eVA a "high priority" for Gov. Mark Warner, even though it was originally conceived under his Republican predecessor, Gov. James Gilmore. Bowen said enterprise-level projects such as eVA demand strong commitment from state political leaders if they are to succeed.
"The problem with being the first out of the box among the states with this is that we don't have any models," she said. "We are ahead of the pack among the states."
The system includes an Internal portal, a data warehouse for purchasing data storage and analytical tools to examine buying trends. eVA captures and analyzes the buying habits of approximately 169 different state agencies - including hospitals, universities and colleges - and 80 local governments.
"It is an electronic means of procurement that will enable the Commonwealth of Virginia to save money in how it does business," Bowen said.
The eVA project launched in October 2000 when American Management Systems (AMS), a systems integrator and application service provider, was hired to develop the application and manage the daily hardware and software operations. The system, which became fully operational this year, has handled $172 million in purchases so far.
"This is cheaper than going out and buying a bunch of hardware and software and setting up a huge operations organization," said Bob Sievert, functional project manager for eVA. "Let a supplier do that for us."
eVA is a marriage of two solutions: AMS' Buysense, an administrative and organizational tool, and Ariba Inc.'s electronic marketplace application. New York-based Exodus Communications provides leased servers to store purchasing data securely with round-the-clock backup. The project also relied on input from state and local government purchasing agents and IT specialists to tailor the system to Virginia's requirements.
The project required AMS to pull together various agency purchasing practices, accounting systems and enterprise resource planning systems into a single, comprehensive purchasing application, said Ron Bell, director of Virginia's Division of Purchases and Supply within the Department of General Services. The key to eVA's success is an interface that allows data sharing among multiple government ERP solutions and a corporate financial system. Bell compares the interface to "a switchboard operator" organizing telephone calls. At the moment Microsoft Corp.'s Biztalk software handles the message broker function, but the state hasn't decided on a long-term provider for that piece of the system.
At the core of eVA is a single Internet portal through which goods and services are bought and sold in Virginia's highly decentralized public sector. The system offers a central electronic repository of solicitations, so vendors across the state can view and bid on business opportunities from state agencies and local government. Push technology informs vendors by e-mail when new purchases are contemplated. All public-sector purchases are processed through eVA and stored in the data warehouse. And the portal features an eMall where state and local government buyers can shop from statewide contracts and ad hoc catalogs.
Decentralized Infrastructure
Flexibility was vital to eVA's success, Bowen said, noting that state and local agencies in Virginia traditionally have conducted their own purchasing. That autonomy often is a positive thing, but it also has a downside: One part of a government organization often didn't know what another part was buying, Bowen said.
"If we don't know what we are buying, then we have no opportunity to take advantage of bulk purchasing or to take advantage of competition [among suppliers]," she said. "In a decentralized culture, you think solely in terms of what is in the interests of 'my agency,' and you just miss, in that kind of culture, the opportunity to work together for the benefit of all."
As of July 2002, executive-branch agencies within the state and all local agencies must register with eVA and conduct all purchasing through the Internet portal.
Agency procurement officials at state and local levels still make individual buying decisions based on specific institutional requirements, but now eVA provides access to valuable procurement information that wasn't previously available in an organized fashion.
Furthermore, eVA has equalized access to technology. Local governments in poorer parts of Virginia that previously relied on a typewriter, a notepad and U.S. Postal Service, now have access to computers, software and an Internet-based solution, Bell said.
The system gives buyers more leverage over suppliers, too. Under eVA, every transaction involving specific suppliers is documented and made available to all state and local government procurement officials. They also can find out about statewide contracts and take advantage of them, Bell said. "We [the state agencies] were not able to work together like we can now. We can see what everyone else is buying."
With these capabilities, Bell envisions more partnering among public-sector buyers for specific contracts. "You could have a local government and a social services shop partner together in contracting out the lawn care," he said.
And having online access to the latest product catalogues for registered suppliers allows buyers to quickly take advantage of special pricing.
"We can go in the Dell Computer Web site and make a purchase without going through one of their purchasing representatives," said Jan Fatouros, technical director for eVA and director of IT in Virginia's Department of General Services.
Furthermore, state and local government procurement officials can e-mail registered suppliers to request quick quotes on specific items. If the price is right, a purchase can be made within two hours, Fatouros said.
Vendor Partnerships
Although some companies initially balked at paying eVA's registered vendor fee, supplier reaction to the system has largely been positive, according to state officials. The vendor fee, based on 1 percent of a purchase order and capped at $500, aims to help the financially strapped Virginia state government pay for the $30-million eVA project.
Bell argued that vendors save money by using the system. "What about all of the labor it takes to hand-carry bids up to the bid office, as well as FedEx and UPS charges? We are freeing them from a lot of cost," he said. "What the research out there is saying is that there is anywhere from a 12 to 14 percent reduction in administrative costs to the suppliers [with eVA]."
Virginia's philosophy is that eVA's customers include both buyers and sellers, Fatouros said.
"What we have learned from other states is it is important to bring in the vendors early [in the process] and make sure the solution you are proposing is acceptable to them and they can reuse it for their customers," Fatouros said. "Other jurisdictions failed to treat their vendors as customers of the [electronic procurement] solution."
At the same time, Bell said there was a fair amount of consultation with participating agencies and local governments early in the eVA development process. Those talks resulted in innovations such as a feature that allows purchasing administrators to customize eVA to fit their data-collection requirements.
Now Virginia is expanding eVA's capabilities. By the end of the year, the system will process complex procurements and negotiations with suppliers, including competitive sealed bidding and competitive negotiation over the Internet.
