12 19 2018 ARIZONA STATE RETIREMENT SYSTEM Oracle

12. 19. 2018 ARIZONA STATE RETIREMENT SYSTEM Oracle Modernization Project Presentation to Information Technology Authorization Committee (ITAC)

Oracle Modernization – PROBLEM DESCRIPTION Page 2 • ASRS maintains two independent business applications – PERIS, Oracle Forms and Reports, developed 1998 - 2004 – PERIS Online (POL), Java, developed 2005 – present • PERIS and POL provide the ASRS business users with functionality to service their members and employers. The business applications include the processing of contributions from employers through the disbursement of benefits including long term disability, refunds, health insurance, retirement and survivor benefits • Oracle Forms and Reports is an outdated technology and will no longer have updates, security alerts or critical patch updates provided by Oracle after December 2018 • Increased technology support, maintenance, and development costs • Business productivity is compromised due to restrictive Oracle Forms user interface and two different business application systems • Oracle Forms and Reports servers have high and medium security vulnerabilities due to the old versions of software they run ASRS | Benefits Disbursement Project Presentation

Oracle Modernization – SOLUTION Page 3 • Reengineering of the Oracle Forms and Reports was started on September 16, 2013 • Reengineer the Oracle Forms and Reports over a 7 year period • Integrate the PERIS application into the existing POL Java based Web application • Utilize the existing Java and Reporting toolsets already in place at ASRS • Utilize existing development resources already in place at ASRS | Benefits Disbursement Project Presentation

Oracle Modernization – BENEFITS Page 4 • Fewer technology skills required for developers • Take advantage of open source and Java features, tools and products • Reduce development costs, one application POL, rather than two (PERIS and POL) • Reduce maintenance costs of developed systems • Increase productivity for business by only having one application, standard user interfaces, more consistent business rules and calculations • Re-engineer business processes to increase business productivity and improve service turn around time to members and employers • Eliminate security vulnerabilities on Oracle Forms and Reports servers ASRS | Benefits Disbursement Project Presentation

Oracle Modernization – IMPLEMENTATION PLAN Page 5 Estimated Hours Actual Hours (10/31/18) Actual Start Date Actual End Date % Complete 10, 175 4, 441 9/16/13 4/30/14 100% 11, 500 10, 742 10/28/13 12/4/14 100% 14, 941 13, 198 1/7/14 5/27/15 100% Employer Demographic System 5, 485 5, 903 7/11/14 4/30/15 100% Service Audit System 8, 361 8, 522 5/7/14 5/27/15 100% Health Insurance System 24, 036 23, 984 2/9/15 8/28/17 100% Service Purchase System 34, 425 33, 790 12/23/14 8/28/18 100% PERIS Application Name Infrastructure & Member Summary Participant Demographic System Membership Accounting System ASRS | Benefits Disbursement Project Presentation

Oracle Modernization – IMPLEMENTATION PLAN Page 6 Actual Hours (10/31/18) Actual or Planned Start Date Actual or Planned End Date % Complete PERIS Application Name Budgeted Hours Benefits Accounting System 12, 105 10, 683 8/1/17 2/28/19 88% 19, 528 798 9/1/18 12/31/20 4% 21, 673 12, 456 2/1/17 7/31/19 57% Fiscal Year End Decommission Oracle Forms & Reports 1, 854 0 2/1/19 7/31/19 0% 2, 000 0 8/1/19 12/31/19 0% Remaining Reengineering 19, 130 0 8/1/19 12/31/20 0% TOTAL HOURS 185, 213 124, 517 New Retiree Processing System Contribution Accounting & Accounts Receivable Ledger % COMPLETE ASRS | Benefits Disbursement Project Presentation 67%

Oracle Modernization – SPENDING SUMMARY Page 7 FY YEAR Appropriation Amounts Amount Spent as of (10/31/18) FY 2014 $1, 390, 000 $1, 117, 381 FY 2015 $4, 484, 500 $1, 736, 222 FY 2016 $2, 270, 000 $909, 092 FY 2017 $2, 070, 000 $1, 041, 116 FY 2018 $1, 364, 155 FY 2019 $549, 270 Total $10, 214, 500 $6, 717, 237 Remaining $ $3, 497, 263 Percent Spent 66% ASRS | Benefits Disbursement Project Presentation

Oracle Modernization – PROJECT STATUS Page 8 • As of October 31, 2018, we have used 66% of the budget. Seven of the eleven systems have been implemented in production • Benefits Accounting System, currently in progress, will be implemented in phases in December 2018 and February 2019 • Contribution Accounting and Accounts Receivable Ledger will implemented in phases in February 2019 and July 2019 • New Retiree Systems will be implemented in phases, the first phase in May 2019 and the final phase in December 2020 • Fiscal Year End will be implemented in July 2019 • Oracle Forms and Reports will be decommissioned by December 2019 • Remaining reengineering work will be completed December 2020 ASRS | Benefits Disbursement Project Presentation

Oracle Modernization – END DATE EXTENSION Page 9 • We are requesting an extension to the end date of the project from 12/19/2018 to 12/31/2020 • The reasons for the extension include: Ø Health Insurance turned out to be more complex than originally estimated and required more re-engineering than anticipated Ø Service Purchase was a large and complex system which was entirely paper driven and very difficult for the business users, members and employers to use and understand. A decision was made to completely re-engineer the Service Purchase system to be an on -line, Web-based system for both members and employers Ø We were not able to dedicate three teams for the entire duration of the project due to other project commitments ASRS | Benefits Disbursement Project Presentation

Oracle Modernization – END DATE EXTENSION Page 10 • The end date extension does not have any effect on the budget. We have enough funds to finish the project. All funds have been appropriated and are non-lapsing • We request approval to extend the end date in order to finish the work on Benefits Accounting, Contributions Accounting and Accounts Receivable Ledger, New Retiree and Fiscal Year End • We request approval to extend the end date so that we can decommission Oracle Forms and Reports as soon as possible • We want to continue to apply further reengineering improvements so that we can fully obtain productivity benefits for our business users, members and employers ASRS | Benefits Disbursement Project Presentation

Oracle Modernization – QUESTIONS • Any questions on the end date extension request? ASRS | Benefits Disbursement Project Presentation Page 11