Colorado Updates 22-Year-Old Financial System

The state of Colorado has been tracking billions of dollars in annual expenditure transactions with a financial system that predates the Internet era. But the system, once considered cutting edge, has become too financially risky to operate.

Conversations about replacing system date back to 1999 when the Office of the State Controller created multiple budget requests. During the last 15 years, independent studies identified the system’s limitations, resulting in a 2011 report from the Office of the State Auditor that stated the legacy computer program was unsustainable. But on July 1st, the state entered a new era when the update to its state financial system finally got underway.

“Colorado set out to create a core financial system that could not only replace our previous accounting system, but expand on its functionality by also integrating finance, budget and procurement,” said Colorado CIO Suma Nallapati. “We wanted a system that would empower employee efficiency, enable program effectiveness and ensure elegant interactions with the state’s customers and residents.” 

That system, called the Colorado Operations Resource Engine (CORE), has the significant task of supporting the state’s commitment to fiscal discipline, financial accountability, government transparency and cost-beneficial controls while handling upwards of $29 billion dollars annually.


According to Nallapati, CORE will have the following benefits:

• Integrate the state’s budget and procurement functions that will result in more seamless, efficient operations; higher reliability; less data reconciliation across systems; and more transparency within and across the system.
• Introduce robust new reporting capabilities and data capture.
• Allow system integration, automated workflows and other business process improvements.
• Increase the state’s ability to respond to changing business priorities, to leverage technological advances and to improve overall system security by functioning on a software as a service solution.

The vendor-facing side of CORE is called Colorado Vendor Self Service, which allows businesses to access and bid on state solicitations. Businesses can view solicitation for free (the previous system cost $40), maintain accounts and receive email notifications when opportunities in their area of interest are published.

“Colorado Vendor Self Service is the new center of commerce for larger dollar purchases,” said David Musgrave, the state’s supplier diversity liaison. “We are excited about the new opportunities it provides to entities doing business with Colorado.”

The state involved key personnel early in project development to support prototyping, system configuration, testing and other tasks to ensure CORE met the state’s needs. The project's developers were also tasked with addressing the concerns of the thousands of employees who were comfortable working in the previous system, some of whom helped design it. 

Implementation was a joint effort between the state’s Office of Information Technology and the Department of Personnel & Administration. In order to get 4,000 CORE users on board and comfortable with the transition, there was a three-month training effort. Last spring, there was a two-day CORE conference to formally introduce the state’s users to the new system and business processes. This continued with general and function-specific training, including online courses and instructor-led courses held in a variety of locations around the state.

“One of the biggest challenges in this project has been moving the state to more standardized ways of doing things that are consistent across departments and that follow established best practices,” Nallapati said. “This has been a major departure from the status quo. Any time you disrupt people’s work flow by asking them to move to a completely new system and new business processes at the same time, you’ll find resistance to change. We regularly reassured state employees that we understood their anxiety and worked to get them as much information and training as possible.”

An additional challenge during this project was the July 1st launch date.

“Some people didn’t feel we were ready and wanted us to delay the launch,” Nallapati said.
However, she recommended coinciding commencement with the beginning of a new fiscal year to simplify the conversion complexity and to simplify financial processing for state controllers and other financial personnel.

To rationalize the $30.5 million it cost to configure the system, Nallapati said the state will measure its return on investment based on several factors:

• Eliminating the risk of failure of the state’s previous financial system.
• Decreasing the number of disparate systems used for accounting, budget and procurement functions, which is projected to increase efficiency through the elimination of the time and cost involved in reconciling data across different systems.
• Data mining and retrieval will be more powerful than what was previously possible, making reporting to the state’s stakeholders easier, more reliable and more transparent.
• Opening the possibility for types of reporting that were previously not an option. The state will be able to monitor the time it takes to complete a contract and a purchase in the system, reduce the number of checks the state issues and significantly reduce the amount of paper filing.

In the future, an addition to CORE will be its ability to manage the lifecycle for grants that state receives and grants that it issues.

“The state has invested significant money and effort in the implementation of CORE, and we are glad it has been a success,” Nallapati said. “As we move past these initial implementation months and transition to steady state operations, our focus is on ensuring we have the necessary support structures in place to maintain the application and processes for years to come.”