Madison College Information Technology and Workday

Implementation Update

Workday is a Finance, Human Resource, Payroll Software Solution

History/Benefits, Current Status,

& Next Steps

Mirwais (Mir) Qader – CIO January 8, 2014

Presentation Topics Status of Information Technology (IT).

What is Workday?

What is the motivation for Workday – why are we doing the project?

What is the history and current status of the Workday project?

What changes do we need to make to successfully complete the project?

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Glossary of Terms – I Architect: A highly skilled person who has vision and several years of experience in designing technical solutions.

Architecture: Overall design of a system and all its components. Ensuring that components operate with one another and the overall environment’s integrity is maintainable and the system(s) are supportable over time.

“As-Is”: The current way things are done.

Business Analyst: A person skilled in finding out what people need, mapping expressed needs to technical specifications and working with technical people to build a solution for the needs expressed.

Cloud Solution: A system that is hosted at a remote location; not on premise.

Configuration: Changing system parameters, connecting existing processes via workflows, not writing programs or code.

Customization: Developing, writing underlying code for a system.

Culture: How people behave and use/operate processes and systems in the organization.

Data Center/Storage Environment: A location where servers, network equipment and various IT infrastructure is securely housed/installed.

Disaster Recovery: In the event that all systems fail due to natural disasters or man-made, getting back to operations as usual, e.g., power surge, tornado, etc.

ERP – Enterprise Resource Planning: A system with a suite of integrated applications/ modules that perform various functions.

Executive Sponsor: Person(s) who are ultimately driving the business/operations and changes in the organization.

Hosting: Installation of system on computers at a particular location.

Implementation: To roll-out, deploy a system/solution fully across the organization with adequate training, documentation and support.

Infrastructure: All the servers, network, data cabling/wiring in the walls, databases, etc. that are necessary and used to support automation needs. These things are typically not seen but used all the time.

Integrations: Connections between 2 or more systems e.g., direct deposits into a banking system/accounts.

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Glossary of Terms – II Manual Processes: Performing activities by hand, not using automated systems, e.g., filling out duplicate paper forms.

“Out of the Box”: An implementation strategy that involves limited to no customization, mainly configuration.

Process Re-Engineering: Changing the way we do work significantly from how we have historically performed the work.

Project Manager: A person charged with ensuring a project gets completed within the scope, timeline and budget defined.

Requirements: The explicitly defined needs and attributes that technical solutions are expected to solve/address.

Resources: Both people and funding/money.

SaaS – Software as a Service: Another name for a Cloud-based solution. Vendor provided and managed software. Internal IT does not manage the software, we only need to connect to it over the network.

Self-Service: Performing certain activities by one’s own, not needing assistance/help from someone in the organization, e.g., changing your mailing address when you move.

Shadow Systems: Systems that are used/developed outside of the main system to perform partial functions that either cannot be performed by the main system or are needed in addition to existing functions, for instance, a key Excel spreadsheet.

SME – Subject Matter Experts: People who know the ins/outs and details of how specific processes work, like Payroll.

Solution: A hardware/software that helps us solve a business problem or allows us to take advantage of an opportunity.

Support: The ability to answer questions and provide help to people who need assistance with a system e.g., a Help Desk.

Sunk Costs: Costs already spent/incurred (in the past). Funds are no longer available.

“To-Be”: The desired way that we want things to work, in the future.

TCO – Total Cost of Ownership: The full implementation and maintenance of a system over its lifetime; includes: project cost, staff, software/ hardware, on-going support. Full disclosure of the costs associated with a project.

Upgrade: To move from one version of a product to a newer version of the product that has been released by a vendor.

Workarounds: Performing activities in addition to or around an existing process because the automated process cannot handle the entire need. Sometimes workarounds are intentional and “Preferences” rather than necessary activities, for instance, downloading data into Excel for sorting, organizing and reporting rather than using reports produced by the main system. 4

Who am I and key activities? Mirwais (Mir) Qader

– Chief Information Officer (CIO) – Started 5/20/13

June/July/August – Met with Executive Team, Staff, Deans/Campus Managers – Got a sense of the IT environment – Got oriented to Workday project

–Mid June: HR Lead and Project Manager left – Observed key deficiencies in IT (next slide) – Observed that the Workday project has serious resource issues (discussed

later on) –Started drafting a new implementation plan and estimates for internal

discussion/review

September/October/November/December – Hired 2 IT Managers – Hired a Workday Project Manager – Started to Draft Key Issues/Findings into an IT Strategic Plan – Finalized a new implementation plan for Workday – Briefed the new President and made some project changes

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General Status of IT at Madison College

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Current IT Environment – Observations IT at Madison College has some key deficiencies:

1. Limited documentation of technical environment 2. No architecture focus 3. Immediate/short-term need focused 4. Resources lacking in:

1. Project Management 2. Business Analysis 3. Data Management

5. Lack of various plans: 1. Infrastructure upgrade 2. Disaster recovery

We need to add key resources: – Architecture – Project Management – Business Analysis – Security – Data

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Approach to Project Funding Historically, project funding focus has been primarily on

vendor-related costs or immediate project costs. – This is typical at various organizations.

We need to focus on “Total Cost” because… – We need full disclosure of costs to make better decisions – There are many hidden costs that may impact our decisions, for instance:

–Staff time away from normal duties participating on a project –On-going support and maintenance costs and staffing needs –Technology refresh/upgrades, etc. –Life-expectancy of the system/solution

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What is Workday and the Motivation for the Project?

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Workday is a securely hosted integrated Human Resource

(HR)/Payroll and Finance system.

Workday is an ERP – Enterprise Resource Planning system; a suite of integrated applications/modules.

The system’s infrastructure is managed by the vendor

– securely hosted in the “Cloud”

What is Workday?

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?

Nowadays, Need a More Responsive Solution

Traditional ERP Heavy

Complex Expensive

Rigid Irrelevant

Ideal Light

Simple Economical

Agile Relevant

How can we get to there from here?

Shadow Systems & Manual Processes

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Real SaaS Delivery Platform – Cloud

Upgrades Patches Availability Backup Network Storage Operating system Database

Newest innovations

Rapid implementation

Immediate upgrades

Lower LT operating costs

Better service levels

Comprehensive security

Integration Provisioning Security Data center Disaster recovery System maintenance Performance tuning

What vendor does for us: What we get:

SaaS = Software as a Service

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Helps automate, improve, and standardize Business Processes.

Provides more HR & Payroll Self-Service.

Eliminates the need for Madison College IT to set up and support a data/storage environment – a big cost and logistical issue

For more details, please see attachment for project deliverables mapped to AS-IS (current state) and TO-BE (future state with Workday).

What does Workday do?

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Allows us to stay compliant to regulations and/or reporting issues: Federal: Affordable Care Act

State: WTC Purchasing Contracts Tracking

Also: Minimizes use of paper forms

Minimizes the number of “shadow” systems

Minimizes multiple entry of same information in multiple places

Automates approvals

Automates and integrates work between Payroll and Finance

Other Benefits of Workday

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Limitations in business processes

Reduces manual paperwork, workarounds and duplications

Limits customization

Saves on IT Costs

Why does Madison College need Workday?

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Has audit trails

Automatically documents processes

Industry best practices in HR & Finance

Knowledge Retention – Succession

Why does Madison College need Workday?

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What is the History and Current Status of the Workday Project?

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PeopleSoft implementation at Madison College is about 13 years old.

HR and Finance modules were not fully implemented.

HR and Finance modules have not been connected/ integrated to transfer data to/from.

Many manual and shadow systems exist/created to handle needs.

Our ability to analyze data and make better decisions is limited, cumbersome, slow and incomplete.

History of Project?

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RFP issued February 2012 to find a solution to HR and Finance needs.

Workday was identified as an innovative emerging solution.

Implementation of Workday was anticipated to cost about $7 million (over 3 years):

$2.4 million vendor costs

$4.6 million internal staffing/technology costs

The project was anticipated to save the College about $4 million, primarily out of the savings of PeopleSoft licensing.

History of Project?

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What was done? 07/12 to 02/14 – SOW #1 – Statement of Work 1 –

focused on developing the business case, planning, getting a sense of the project’s scope.

05/13 to 07/14 – SOW#2 – Statement of Work 2 – focused on the development and implementation:

– Detailed plans completed

– 250 processes, 102 integrations, 829 customizations, etc. identified

– Governance and core team established

– Design/configurations of some key processes completed with vendor

As of about mid-November, 2013, the project has been on hold for major activities.

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Project Governance (see attachment for details)

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What are Key Realizations So Far? Our environment is very complex

Timeline of completion by 7/1/14 is unattainable

Project Management has been challenging

Cultural change needs a parallel project

Need key staff roles filled for project

Budget has been more “Project-Based” than Total Cost

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Business Intelligence – Data Reporting

Parallel Project Phases

These large activities HAVE TO occur in parallel!

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Base System Implementation

Security & Data Reviews & Standardization

Change Management – Culture

What changes do we need to make to Successfully Complete the Project?

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Key Success Factors Going Forward

Contain the scope.

Adopt business processes from Workday “AS-IS”.

Establish comprehensive data and security policies.

Constantly manage organization/cultural change.

Resource the remainder of the project.

Ensure project issues have immediate executive sponsor resolution.

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(1) Split the Implementation Original plan assumed implementation of BOTH HR and

Finance at the SAME TIME.

Splitting the implementation allows us to focus/commit the right level of resources and ensure integration/ interoperability between the sub-systems.

Proposal is: – Implement HR first, then Finance

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(1) Split the Implementation - Impact Extends the project timeline

Increases project costs

Benefits:

– Better assessment of needs

– More accurate implementation

– More Subject Matter Expert (SME) participation

– Time to refine Change Management strategy and enable adoption of the new business processes at Madison College

– Complete technical assessments to minimize vulnerabilities e.g., Security, Data, Compliance Issues, etc.

– Cost savings, long-term, minimizing missed requirements & repeat work

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(2) Increase the Timeline Original timeline assumed implementation of both HR

and Finance functions within a 1-year timeframe. This was VERY aggressive.

– We cannot effectively meet this timeline given the scope defined and resource (staffing) shortages.

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Projected Need: 40%-60%

Actual Availability: 5%-20%

MC Subject Matter Expert (SME) Resource Needs

Timeline

Gap

(2) Increase the Timeline With the original timeline, we had not anticipated the

level of complexity of our environment.

With the original timeline, critical project steps were missed: – Data Standardization – how will we define common terms, common data

elements that mean the same thing across our entire environment.

– Prevents us from being able to link and analyze information effectively.

– Security Assessment on a process by process and transaction by transaction basis (vendor/application security was primarily considered)

– Significant process re-engineering and change management, etc.

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(2) Proposed Timeline Change

7/1/14 Original implementation date for BOTH HR and Finance

1/1/15 New timeline for HR

implementation

7/1/15 New timeline for

Finance implementation

Split HR and

Finance (18-months)

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(2) Timeline Change Impact During first part of Fiscal Year 2014/2015:

– We will have to develop an interim, throw-away connectivity from Workday-HR to the existing Finance sub-systems until the new Workday-Finance is up an running. The anticipated costs are: $67,000

– The vendor’s time commitments on the project increases, hence, an additional cost of about: $640,000

Benefits:

– Increased probability of success and completion of the desired scope/functionality that was originally planned.

– Get our own house in order. Project strains are more on Madison College side than on the Vendor side.

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(3) Hire Key Staff/Resources Key staff resources had not been anticipated:

– Assumptions were made that there would be very minimal IT needs, and/or

– Assumption was that the Cloud-based solution would accommodate most of our needs, and/or

– Internal staff had both the technical knowledge and the bandwidth/capacity to do project work while also doing their normal operational activities.

Concerns: without these resources, the implementation WILL be incomplete and vulnerable to a variety of issues: – Security/data issues – Compliance issues – Incomplete implementation – Cultural acceptance, etc.

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(3) Hire Key Staff/Resources Critical IT Staff (on-going):

– Data Architect – Security Architect – Business Intelligence/Reporting Analysts – IT Business Analysts

Contractor Staff (project-based): – Change Manager – Integration Staff – Architect Staff (until internal IT Staff can be recruited)

Business (HR & Finance) Staff Augmentation (most will be project-based; some on-going):

– HR/Payroll Back-fill Staff & Business Analysts/Testers – Finance Back-fill Staff and Business Analysts/Testers

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Project Timeline and Costs

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Do Nothing: – Estimated inefficiencies in existing processes and activities: $5.25 million

– Madison College spends ~$25 million yearly on procurements – ~.5 FTE cash processing – ~1.0 FTE bank reconciliation – Payroll – Compensation Management – Position Budgeting – Absence Management – Benefits Administration – Time Tracking – Compliance & Reporting

– Lack of integrated and complete data for analysis and decision-making

FY12/13 FY13/14 FY14/15 FY15/16 FY16/17 FY17/18 FY = Fiscal Year: July to June

Workday:

PeopleSoft:

The PeopleSoft implementation should have operations cost greater than Workday to due additional need for technical staff.

Project Timeline and Costs

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Sunk Costs

$1.4M $0 $8.9M $14M

RFP/Plan SOW1 SOW2 HR Finance

$15.5M

Operations

$16.5M $3.2M

$1.6M $5.1M

RFP/Plan PS 9.2

$12.3M

PS 9.3 (anticipated)

$15 M $0 $19.3 M

Lost Opportunity

FY12/13 FY13/14 FY14/15 FY15/16 FY16/17 FY17/18

$17.5M

Done with Implementation (~18 months)

PS 9.4 (anticipated)

~$16M FY = Fiscal Year: July to June

Close-out

Efficiency Gains

(4) Overall Budget Impact FY13/14 - need $1.26 Million

– From January, 2014 – June, 2014 – For: Architecture (Security, Data, Disaster Recovery, Identity Access

Management), Business Intelligence, Business Analysts/Testers/Trainers, HR/Finance Backfill Staff, PeopleSoft Integration Consultants, Quality Assurance, Change Management

FY14/15 – need $3.35 Million – From July, 2014 – June, 2015 – For: Workday Vendor, Workday Training, Project Management, Architecture

(Security, Data, Disaster Recovery, Identity Access Management), Business Intelligence, Business Analysts/ Testers/Trainers, HR/Finance Backfill Staff, PeopleSoft Integration Consultants, Quality Assurance, Change Management

FY15/16 – need $300,000 – From July, 2015 – June, 2016 – For: Old system (PeopleSoft and Interfaces) decommissioning and retirement

HR/Finance Backfill Staff (in the above figures): – $195,000

On-Going Operations: – Licensing: ~$415,968 (less ~$200,000 PeopleSoft Licensing Costs) – Staffing: ~$492,045

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(4) Proposed Funding Sources FY13/14

– Existing IT and Program Staff – General Funds (already budgeted)

– New Staff – Capital Funds – Borrow C

FY14/15 – Existing IT and Program Staff – General Funds – New On-Going Staff – General Funds – Project Staff – Capital Funds

FY15/16 – Existing IT and Program Staff – General Funds – New On-Going Staff – General Funds – Project Staff – Capital Funds

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THANK YOU! Questions?

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