CIO Status Report Lemuel C Stewart Jr CIO

CIO Status Report Lemuel C. Stewart, Jr. CIO of the Commonwealth Information Technology Investment Board August 10, 2005 expect the best www. vita. virginia. gov 1

Audit Action Plan Update • 2005 APA Internal Control & Compliance Audit Action Plan The 1 action has been completed. • 2005 APA Performance Audit Action Plan 7 of 15 actions reported as completed 4 actions have revised completion dates: #6 Project Proposal Template Enhancements 11/15/05 #7 Portfolio Enterprise Solution 8/19/05 #11 Security Procedures and Configuration Standards – 9/15/05 #12 Integration of Security Governance & Security Operations - 9/30/05 Remaining 4 actions reported to be on schedule www. vita. virginia. gov expect the best 2

Audit Action Plan Update • 2004 APA SAS 70 Audit Action Plan 3 of 4 actions reported as completed 1 action has a revised completion date: #2 Develop Configuration Standards – 9/15/05 • Internal Audit Small Purchase Charge Card Audit Action Plan 2 of the 16 actions reported as complete 12 actions have revised due dates primarily tied to policy revisions Remaining 2 actions reported to be on schedule www. vita. virginia. gov expect the best 3

Finance Report—Cash Flow www. vita. virginia. gov expect the best 4

IT Savings Initiatives www. vita. virginia. gov expect the best 5

VITA SWAM Update • SWAM PROGRAM – Hired a dedicated SWAM Outreach Specialist – Beverley Coleman – Continued coordination w/ DMBE for awareness, education & certification – SWAM specific Web page with access to upcoming procurements and approved projects • Three largest spend relationships – Digital Intelligence Systems Corporation – $12 M – Daly Computers, Inc. – $5 M – DLT Solutions, Inc. – $1 M www. vita. virginia. gov expect the best 6

SWAM IT Spend (Two Years) Millions Entities Leveraging VITA-Facilitated Suppliers www. vita. virginia. gov expect the best 7

JLARC Customer Survey • Significant concerns with methodology • VITA/UVA Center for Survey Research www. vita. virginia. gov expect the best 8

Transformation & PPEA • Common themes about current state of IT – IT investments are managed effectively—we are doing things the right way – Agency-centric approach is OK—we don’t need to change the way we do business – Consolidation means large, immediate cost savings • Extensive due diligence results support the need to change the way we do business www. vita. virginia. gov expect the best 9

Current State—Due Diligence Results • Highly decentralized model of service delivery and administration • Largely self-contained solutions (silos) • Antiquated systems developed in the ’ 70 s • Aging workforce • Inadequate security tools and inconsistent practices and standards • Inadequate data center facility with security risks • Duplication of administrative systems at high cost www. vita. virginia. gov expect the best 10

Current State—Infrastructure • 70 IT helpdesks • 8 different e-mail systems running on 270 servers • Lack of standardization and inability to transfer employee skills • Inability to deploy enterprise solutions on common infrastructure • Limited performance measures and service metrics • Inadequate disaster recovery and continuity of service plans • Servers, networks, and PCs underutilized www. vita. virginia. gov expect the best 11

Current State—Infrastructure Capacity “Dashboard” 20 40 60 80 20 100 0 3, 000 Servers <20% 20 40 60 80 0 100 160, 000 Network Connections <60% 80 20 100 Website compliance with Sec. 508 23% www. vita. virginia. gov 40 0 40 60 80 100 Desktop Computing Capacity <10% (vs. Grid Computing) expect the best 12

Current Status—Enterprise Applications 26 processes examined in 46 agencies # of Systems Financial Systems Human Resources Systems Other Admin Systems Total Annual Cost www. vita. virginia. gov Annual Cost 160 $117 M 55 $36 M $147 M $300 M expect the best 13

If We DON’T Transform… It Will Cost Us • $1. 8 billion over the next 6 years to maintain antiquated, outdated administrative systems • An additional $600 million in new, duplicative systems • An additional $200 million to maintain “as is” infrastructure environment • Missed opportunity to redirect 50% to 70% of these costs into re-engineering and improving government service programs www. vita. virginia. gov expect the best 14

Where Are We Trying to Go—Future State • Shared, modern and more efficient administrative systems • Standard technology platforms to take government service delivery to new levels • Adequate security of Commonwealth assets and a secure data center • More enterprise vs. duplicative systems • Greater efficiencies, optimal use of resources and improved services • Common, integrated, and secure enterprise network www. vita. virginia. gov expect the best 15

Where Are We Trying to Go—Future State • Standardized messaging and communications systems • Server consolidation (3, 000 to <1, 000) • Helpdesk consolidation (70+ to 1) • Reduce costs over the long term and spend taxpayer dollars more wisely Bottom line ______________ Consistent performance Consistent Service Predictable Cost www. vita. virginia. gov expect the best 16

How Do We Get to The Future State? • The Commonwealth faces significant challenges: – Funds to support a $500 million investment in changing the way we do business – Culture is agency-centric vs. enterprise oriented – Sheer size, scope, and complexity of transformation – Lack of tools and resources to do the heavy lifting • One option under evaluation is a public/private partnership www. vita. virginia. gov expect the best 17

Partnership Rules of Engagement • • • Employees MUST be treated fairly and equitably No additional GF or taxpayer dollars No impact on our bond rating Must have skin in the game—investment & risks Must provide value to citizens – Economic development in Southwest / Southside • Provide more efficient and modern IT environment that improves services • No increased cost over our FY 05 baseline expense level www. vita. virginia. gov expect the best 18

PPEA—Status • Infrastructure PPEA Status – Two vendors under review that met those conditions • IBM ● Northrop Grumman – Detailed review completed, but slightly behind schedule – Steering committee recommendation pending ITIB review and approval • Enterprise Applications PPEA Status – Detailed proposals received August 8 – Review to be completed with recommendation to ITIB September 8 www. vita. virginia. gov expect the best 19

PPEA—Participation • Highly collaborative review of infrastructure and enterprise applications – 85 individuals representing 21 agencies • 3 cabinet Secretaries and 2 deputies • 7 agency heads – Council on Technology Services Workgroup – Independent review • Gartner • Gordon & Glickson • Mc. Clain Group (Enterprise) www. vita. virginia. gov expect the best 20

Value Highlight Before Transformation • No major project failures since July 2003 • Reduction of investments in duplicative, standalone solutions (LMS, Licensing, GIS, Security, etc. ) • Cumulative cost savings and avoidance to customers of $56. 4 million in FY 04 & FY 05 • Integrated IT infrastructure functions of 90 executive branch agencies • Annual review and prioritization of Commonwealth IT investments by the ITIB • Commonwealth IT standards, policies, and procedures built on industry best practices www. vita. virginia. gov expect the best 21

CIO Status Report Supplemental Materials expect the best www. vita. virginia. gov 22

Quarterly Highlights • Held VITA Dialogue meeting on June 9 on Transformation; next meeting planned August 11 • As a result of receiving a large amount of cash payments from customers, VITA's treasury loan was repaid – ahead of schedule – on June 30 • Published and distributed VITA Quarterly Report on July 1 • Delivered CIO briefing to ICG on July 12 • Leslie Carter was lunch keynote speaker at National Minority Technology Council conference on July 15 • Transformed service delivery to the Governor’s Office and Cabinet, beginning July 25 • Earned Meridian Customer Award for “Best Launch of the Knowledge Center” for the enterprise Learning Management System on July 28 www. vita. virginia. gov expect the best 23

Infrastructure Current Status Milestone Start Date End Date Program Planning 1/10/2005 1/27/2005 Develop plan for the detailed review of the VITA PPEA infrastructure proposals. Conduct initial planning meetings. Establish Infrastructure PPEA Steering and Finance Review Committees. Due Diligence 1/27/2005 4/15/2005 Establish the base case/current processes and automated systems which support them. This task has been COMPLETED. Draft SOW/SLA/Ts & Cs 3/28/2005 4/28/2005 Develop Statements of Work (SOW), Service Level Agreement (SLA) expectations and draft terms and conditions. Provide to proposers for completion of detailed proposals. COMPLETED Develop Detailed Proposals 4/29/2005 6/20/2005 Proposers develop detailed proposals in response to base case, SOW/SLA and Terms & Conditions Review Detailed Proposals 6/21/2005 8/10/2005 Commonwealth team reviews detailed proposals Negotiate Comprehensive Agreement 8/11/2005 10/15/2005 Negotiate Comprehensive Agreement (CA) for infrastructure services. Status Yellow because Finance Committee has informed us the agreement may require Treasury Board and General Assembly approval. www. vita. virginia. gov Status Comments expect the best 24

Enterprise Applications Current Status Milestone Start Date End Date Start-up 3/22/2005 4/11/2005 Develop Plan for the detailed review of the PPEA Enterprise Applications proposals. Conduct initial meetings with IBM and CGI -AMS. Establish program organization, to include steering committee. COMPLETED Due Diligence 4/11/2005 6/23/2005 Establish the base case, including current processes and the automated systems which support them. Draft SOW/Ts & Cs 5/2/2005 6/23/2005 Develop Statements of Work (SOW) and draft terms and conditions, to define the services that the Commonwealth envisions obtaining from the offerors and the Commonwealth’s initial view of the legal details of the agreement. Release Proposal Package to Offerors 6/27/2005 The Proposal Package, consisting of the Due Diligence Data, Draft SOWs and Draft Terms and Conditions is released to the offerors Develop Detailed Proposals 6/27/2005 8/5/2005 Proposers develop proposals in response to base case, SOW/SLA and Terms & Conditions. Evaluate Detailed Proposals 8/5/2005 9/16/2005 Commonwealth team evaluates proposals. Negotiate Comprehensive Agreement 9/16/2005 10/15/2005 Negotiate the Comprehensive Agreement for Enterprise Applications and obtain senior management approval. Executive Approval 10/15/2005 The Comprehensive Agreement is signed by the Governor. Status Yellow because Finance Committee has informed us the agreement may require Treasury Board and General Assembly approval. www. vita. virginia. gov Status Comments expect the best 25

Local Outreach Update • New Customers since April 2005 – Blue Ridge Regional Jail Authority – Criminal Sentencing Commission – Hanover County – Shenandoah Valley Workforce Investment Board – Southern Virginia Mental Health Institute www. vita. virginia. gov expect the best 26

CIO Major IT Project and Procurement Actions Since Last ITIB Meeting • Project Planning Approval None • Project Development Approval • Contract Approval • Project Suspension or Resumption Approval None Department of Social Services: Child Support Payment Processing Modernization – contract with Protech Solutions, Inc. , $2 million None NOTE: See the August ITIB Major IT Project Status Report (provided separately) for a complete status of the Commonwealth major IT project portfolio www. vita. virginia. gov expect the best 27

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