Transcript PURCHASING DIRECTORS MEETING TAMPA, SEPT. 25, 2003

FLORIDA DEPARTMENT OF HEALTH
ANNUAL WORKSHOP
Orlando, Florida
November 21, 2003
UPDATE ON STATE PURCHASING
Russ Rothman, CPPO
Chief Purchasing Operations Officer
Florida Dept of Management Services
[email protected]
TOPICS
• ROAD MAP TO EXCELLENCE IN
CONTRACTING
• STATE PURCHASING ORGANIZATION
• STATE PURCHASING MISSION
• EPROCUREMENT
• STRATEGIC SOURCING
• NEW APPROACH TO EQUITY IN
CONTRACTING & OTHER OBJECTIVES
• THE FUTURE OF SNAPS
• ETHICS AND THE LAW
ROAD MAP TO EXCELLENCE
IN CONTRACTING
ROAD MAP TO EXCELLENCE IN
CONTRACTING
Inspector General Derry Harper, 6/03
• Need legislative and regulatory changes to address inadequacies and
inconsistencies in statutes and rules
• DMS should accept and implement the leadership role required by
Florida Statute
– develop formal procedures for needs assessments, standard formats for
contracts
– foster user groups to share best practices and common problems.
• Undertake a statewide training initiative, and include incentives to
encourage professionalism and certification.
• Include training in contract negotiation and contract management.
• Create a uniform vendor rating system to include links to websites,
closeout evaluations, and a method for other agencies to access
performance evaluations.
• Propose legislation to enact a law similar to the federal Truth in
Negotiating Act.
DMS shortcomings in leading
contract management
• Inadequate management of contracts by
agencies due to abdication of leadership.
• No collection of information on contractor
performance.
• Failure to share information on contractor
performance among agencies.
• Missed opportunity to use performance
information in contracting decisions.
UNIFORM VENDOR RATING
SYSTEM
Performance Measures under consideration:
• Deliverables, Tasks or Requirements
– Outputs - a definite or indefinite quantity/quality of goods to
be delivered and/or services to be performed, and
– Outcomes - goals, objectives or purpose to be
attained. Outcomes can also apply to schedule, budget
and customer service.
• Schedule - milestones, completion
• Budget - Contract delivered within original budget.
Accuracy, adequacy and timeliness of invoices.
• Customer Service - Communication, reliability,
flexibility, problem resolution, change order
negotiation, exceptions, complaints
TRAINING PROGRAMS
UNDER CONSIDERATION:
In cooperation with NIGP,
• General Purchasing, Purchasing Management,
Contract Negotiation & Contract Management,
eProcurement
• A combination of NIGP and Florida-specific
course content, leading to NIGP and Florida
certification. Examples of Fla. content
STATE
PURCHASING
ORGANIZATION
STATE PURCHASING
ORGANIZATION
Since June, 2003 –
75% NEW LEADERSHIP
25% NEW CONTRACTING
STAFF
75% NEW LEADERSHIP
• Fred Springer, Director of Purchasing – Attorney for
State Purchasing 18 months
• Russ Rothman, CPPO, Chief Purchasing Operations
Officer – founding member of NIGP Tallahassee Chapter,
22 years purchasing experience.
• Elaine Atwood –Bureau Chief leading Teams 1-3. Eight
years state contracts/purchasing and supervisory
experience with two different agencies.
25% New Contracting Staff
• Stu Potlock, B.S., CPPB – new Purchasing Analyst. Eight years
state experience, seven in purchasing, with two different agencies.
• Mark Lovell, B.S., CPPB – new Purchasing Analyst. Five years
state purchasing experience. Thirteen years private sector
management experience.
• Ommet Mbiza, M.B.A – new Purchasing Specialist. Has started
and managed business in Africa and the U.S. FSU COB, with
emphasis on Purchasing & Materials Management
• Renee Gregory – new Purchasing Specialist. Six years state
purchasing experience with three different agencies.
• Chris Kincaid, B.S. – new Purchasing Specialist. Graduate of FSU
COB with emphasis on Purchasing & Materials Management
Contracting staff reorganized
• Director’s Office & Operations Team
• Two contracting bureaus
• Team concept for customer focused service
delivery
• Seven teams of three
• Lead purchasing analyst, purchasing analyst,
purchasing specialist
STATE
PURCHASING
MISSION
Our Mission at State Purchasing flows
from the Governor’s top priorities:
1. Reducing Violent Crime and Drug Use
2. Creating a Smaller, More Effective, and
Efficient Government
3. Building Economic Opportunity for All
4. Helping the Most Vulnerable
5. Improving Quality of Life and the
Environment
6. Improving Student Achievement
And From Our Secretary Bill
Simon’s Mission:
To become a customer focused agency
providing effective and efficient services
in order to better enable state agencies
and employees to deliver the Governor’s
priorities to the people of Florida.
Director of Purchasing Fred
Springer’s Mission:
To gladly deliver useful and
innovative purchasing
services in order to become a
customer focused agency
providing effective and
efficient customer services.
Chief Purchasing Operations Officer
Russ Rothman’s Mission:
To deliver effective and efficient
support services, governance
processes and professional
training to State Purchasing and
agency purchasing staffs in order
to deliver useful and innovative
purchasing services.
What Do These Missions Mean?
For DMS and State Purchasing,
we see our role as driving down
both your administrative costs and
the prices you pay for goods and
services by delivering…
DELIVERING…
• (1) Purchasing statutes, rules and
policies that support economical,
efficient and effective purchasing on
behalf of the State and its subdivisions.
• (2) An effective and efficient electronic
purchasing system,
MyFloridaMarketPlace.
DELIVERING (continued)…
• (3) State term contracts, strategically
sourced, administratively easy to use,
with the best value (prices, item/service
quality, terms and conditions)
obtainable by a customer of our
stature.
DELIVERING (continued)…
(4) Training and support to State
Purchasing, state agency and
subdivision purchasing professionals in
key skills, including general
purchasing, contract negotiation,
contract management, eProcurement
and management of purchasing
operations.
EPROCUREMENT
MyFloridaMarketPlace
MyFloridaMarketPlace will help to streamline the
processes for doing business with the State.
What’s Different?
Electronic creation, routing, and review or
requisitions and issuance of e-purchase orders
Electronic quotes and bids, including reverse
auctions
Online vendor registration
Ability for vendors to maintain company
information online
MyFloridaMarketPlace will help to streamline
the processes for doing business with the State
(continued).
What is to some extent the same?
Vendors relationship with agencies
Use of contracts
Subject to same purchasing statutes and rules
Moving to advanced business technology benefits all
vendors. The MyFloridaMarketPlace system
provides:
Quick and easy access to marketing
opportunities: single portal, email
notifications
Opportunity to shorten order-to-cash cycle
and improve cash flow
Initial Users – Pilot Agencies (July – August 2003)
1. Department of Transportation 2. Department of
Management Services 3. State Technology Office
Initial Users – Executive Branch Agencies (September – April 2004)
Department of Children and Families
Department of Health
Department of Corrections
Enforcement
Department of Juvenile Justice
Department of Environmental Protection
Department of Business & Professional Reg.
Innovation
Department of Lottery
Affairs
Agency for Health Care Administration
Governor
Department of Highway Safety & Motor Vehicles
Department of Elder Affairs
Department of Education
Department of Citrus
Department of Law
Department of Military Affairs
Department of Revenue
Agency for Workforce
Department of Community
Executive Office of the
Department of Veteran’s Affairs
Other Eligible Users (beginning
May 2004)
Legislature
Educational Institutions (K-12, State Univ.)
Judicial
Local Governments
Project Highlights
 27,000 vendors registered in
MyFloridaMarketPlace, including over
8,000 minority business enterprises
Over 3,000 Purchase Orders for over
$60,000,000 to date
Completed Activities
Continued Vendor Information Sessions
combined with targeted phone calls
Developed Sourcing toolkit
Completed Model Office Sessions
Office Supplies Reverse Auction (32%
savings)
MRO Supplies(13.2% savings)
Upcoming Activities
 Continued Vendor Information Sessions combined
with targeted phone calls
 Continue to monitor MyFloridaMarketPlace activities
of DOT, DMS, and STO
 Provide post-implementation support to Citrus,
DOAH and DOH
 Continue support for next wave of agencies, DJJ,
DOC, DCF
 Began testing FLAIR on 10/1
 Online encumbrance and disbursements go-live in
November
STRATEGIC
SOURCING
New Strategy:
STRATEGIC SOURCING
• INTERNAL PROFILE: Analyze where
significant funds are spent, by whom, on
what, and what are the usage trends
• EXTERNAL PROFILE: Analyze industry
trends & vendors
• SOURCING STRATEGY: Determine what
procurement method, what to include,
contract terms, evaluation criteria
INTERNAL PROFILE
This includes a review of data from state
systems, including FLAIR and SPURS,
and surveys of agencies and eligible users
EXTERNAL PROFILE
This includes surveys of vendors, and
review of information available on the
Internet, such as from industry
associations, Bureau of Labor Statistics
(PPI), and business sites, Requests for
Information.
SOURCING STRATEGY
This includes what items to list in a
solicitation, and how to group them, the
type of solicitation (ITB, RFP, ITN, reverse
auction), the terms and conditions,
including contract length, evaluation
criteria, and use of price indexes.
NEW APPROACH
EQUITY IN CONTRACTING
(ONE FLORIDA)
AND FOUR OTHER STATE
OBJECTIVES
REQUIRE PLAN ADDRESSING STATE
OBJECTIVES
BIDDERS/RESPONDENTS INCLUDE
PLAN ADDRESSING
• EQUITY IN CONTRACTING
• RECYCLED CONTENT & POLLUTION
CONTROL
• PRIDE
• RESPECT
• DRUG FREE WORKPLACE
PLAN
• MUST BE INCLUDED FOR
BID/PROPOSAL TO BE CONSIDERED
RESPONSIVE
• SUBJECT TO RENEGOTIATION PRIOR
TO CONTRACT SIGNING
• INVOLVES NO PRICE PREFERENCE
OR POINTS
THE FUTURE OF SNAPS
(State Negotiated Agreements
and Price Schedules)
HISTORY OF SNAPS
• DEVELOPED IN 1996-97 TO
FACILITATE CONTRACTING WITH
INNOVATIVE TECHNOLOGY
VENDORS, AND FOR
ENVIRONMENTALLY FRIENDLY
COMMODITIES AND SERVICES
• SEEN AS POSSIBLE INCUBATOR FOR
FUTURE STATE TERM CONTRACTS
HISTORY OF SNAPS
(continued)
• LIMITED TO PURCHASES UP TO $25,000
(CATEGORY 2) PER TRANSACTION AND
$150,000 (CATEGORY 4) PER CONTRACT,
PER AGENCY, PER YEAR
• AUTHORITY IN 287.042 and 287.056, Florida
Statutes, although the term “SNAPS” is not used
in either section, and 60A-1.008(2), Florida
Administrative Code.
HISTORY OF SNAPS
(continued)
• SNAPS AGREEMENTS HAVE BEEN
RELATIVELY EASY TO GET
• STATE PURCHASING WORK LOAD IS
SUBSTANTIAL, WITH HUNDREDS OF
SNAPS AGREEMENTS PROCESSED
• SAVINGS ARE QUESTIONABLE, AS SNAPS
AGREEMENTS ARE NEGOTIATED, NOT
COMPETED
• AGENCIES FREQUENTLY BEAT SNAPS
PRICES THROUGH INFORMAL BIDS
HISTORY OF SNAPS
(continued)
• FIVE SNAPS AGREEMENTS BECAME
STATE CONTRACTS
• MANY SNAPS AGREEMENTS ARE
NEVER USED
PRINCIPAL CONCERNS
WITH SNAPS
• MOST AGREEMENTS ARE VENDORDRIVEN, THAT IS, RATHER THAN
PROCEEDING FROM AN IDENTIFIED
GOVERNMENT REQUIREMENT, THEY
PROCEED FROM VENDOR DESIRES FOR A
MARKETING TOOL
• EXAMPLE: OF 800 CURRENT SNAPS
AGREEMENTS, MORE THAN HALF
REFLECT NO REPORTED PURCHASES
PRINCIPAL CONCERNS
WITH SNAPS (continued)
• PRICING FOR MANY PURCHASES IS
NOT COMPETITIVE
• PROCESSING WORKLOAD IS HEAVY
• MANY AGENCIES AND ELIGIBLE
USERS WILL NOT USE SNAPS FOR
SIGNIFICANT PURCHASES
SNAPS POSSIBILITIES
1. CONTINUE WITH SNAPS “AS IS”
2. DISCONTINUE SNAPS ALTOGETHER
3. ALLOW SNAPS TO CONTINUE, BUT
RESTRICT USE TO AGENCIES AND
ELIGIBLE USERS NOT ONLINE WITH
MYFLORIDAMARKETPLACE AND ITS
“EQUOTE” CAPABILITY
4. RE-ENGINEER TO MAKE SNAPS PRICECOMPETITIVE AND BUYER (NOT
VENDOR) DRIVEN
LEADING “SNAPS III”
CONCEPT
ISSUANCE OF A SNAPS AGREEMENT WILL
BE CONTINGENT UPON:
1. REQUEST FOR AN AGREEMENT BY A
BUYER (AN AGENCY OR OTHER ELIGIBLE
USER), WITH AN INTENTION TO MAKE A
PURCHASE OF A COMMODITY OR SERVICE
NOT ON STATE TERM CONTRACT
2. SPECIFICATIONS/STATEMENT OF WORK
PROVIDED BY THE REQUESTING BUYER,
LEADING “SNAPS III”
CONCEPT (continued)
3. THE REQUESTING BUYER WILL BE
ENCOURAGED TO IDENTIFY ANY KNOWN
VENDORS WHO COULD MEET THE NEED
4. THE DMS SNAPS TEAM WILL ATTEMPT TO
REGISTER ANY NON-REGISTERED
SOURCES IDENTIFIED, AND WILL
CONDUCT A COMPETITIVE SOLICITATION
USING THE “EQUOTE” TOOL IN
MYFLORIDAMARKETPLACE
LEADING “SNAPS III”
CONCEPT (continued)
• 5. AGREEMENTS WILL BE
ESTABLISHED FOR A TWELVE
MONTH PERIOD WITH NO RENEWAL.
IF A SPECIFIC NEED JUSTIFYING A
SNAPS AGREEMENT IS IDENTIFIED
AFTER THAT TIME, ANOTHER
EQUOTE COMPETITIVE
SOLICITATION WILL BE CONDUCTED
LEADING “SNAPS III”
CONCEPT (continued)
• 6. SNAPS PURCHASES PER CONTRACT
WILL BE REVIEWED QUARTERLY, WITH A
VIEW TO ESTABLISHING A STATE TERM
CONTRACT WHERE $1 MILLION SNAPS
PURCHASES COMBINED WITH OTHER
NON-STATE-TERM-CONTRACT
PURCHASES OF LIKE ITEMS COULD
YIELD SAVINGS >$100K ANNUALLY
BUYERS WILL PROVIDE STATE
PURCHASING SNAPS TEAM
A REQUEST FOR SNAPS AGREEMENT FORM
SHOWING:
•AGENCY OR SUBDIVISION NAME AND
CONTACT INFO
•SPECIFICATIONS/STATEMENT OF WORK
•LOCATION, SCHEDULE, BUDGETARY
LIMITATIONS, ENTITY PAYMENT PROCESS
•AGREEMENT TO PROVIDE SUPPORT IN THE
INFORMAL BID EVALUATION PROCESS AS
REQUESTED
VENDORS RESPONDING TO THE
EQUOTE WILL PROVIDE
• AGREEMENT THAT THE NEW SNAPS
AGREEMENT WILL SUPERSEDE ANY AND
ALL EXISTING AGREEMENTS WITH ANY
RESPONDING VENDOR, COVERING
SUBSTANTIALLY THE SAME
COMMODITIES/SERVICES, AND AGREEING
TO THE CANCELLATION OF ANY SUCH
AGREEMENTS
VENDORS RESPONDING TO THE
EQUOTE WILL PROVIDE (continued)
A LIST OF ALL SNAPS AGREEMENTS
HELD BY THE RESPONDING FIRM,
WITH THE UNDERSTANDING THAT
FAILURE TO SUBMIT A COMPLETE
LIST WILL RESULT IN REJECTION OF
THEIR EQUOTE AS NON-RESPONSIVE
VENDORS SELECTED WILL GET…
• A SNAPS AGREEMENT THAT WILL
HAVE AT LEAST ONE CUSTOMER
• THE ONLY SNAPS AGREEMENT FOR
THE SPECIFIED REQUIREMENTS FOR
THE NEXT 12 MONTHS
• AN OPPORTUNITY TO SELL MORE
THAN THE QUOTED AMOUNT TO
OTHER (or the same) SNAPS USERS
MEASURING SUCCESS:
TARGET OUTCOMES
1.% OF SNAPS AGREEMENTS PUT IN
PLACE AND CONTINUING WITHOUT A
BUYER: ~0% (FROM CURRENT ~50%)
2.% OF SNAPS PRICES DECREASED
EACH TIME A CURRENT SNAPS II
AGREEMENT IS REPLACED BY AN
“EQUOTED” SNAPS AGREEMENT: ~100%
3.% OF SNAPS AGREEMENTS WITH
SPEND
> $1 MILLION ANNUALLY REPLACED BY
A STATE TERM CONTRACT: ~100%
A SHOW OF HANDS
PLEASE…
1. CONTINUE WITH SNAPS “AS IS” __
2. DISCONTINUE SNAPS ALTOGETHER __
3. ALLOW SNAPS TO CONTINUE, BUT
RESTRICT USE TO AGENCIES AND
ELIGIBLE USERS NOT ONLINE WITH
MYFLORIDAMARKETPLACE AND ITS
“EQUOTE” CAPABILITY __
4. RE-ENGINEER TO MAKE SNAPS PRICECOMPETITIVE AND BUYER (NOT
VENDOR) DRIVEN __
ETHICS AND THE LAW
GOVERN YOURSELVES
ACCORDINGLY
STANDARDS OF CONDUCT
S.112.323(2) SOLICITATION OR
ACCEPTANCE OF GIFTS--No public
officer, (or) employee of an agency…shall
solicit or accept anything of
value…including a gift, loan, (or)
reward…based upon any understanding
that the … official action, or judgment of
the public officer, (or) employee…would
be influenced thereby.”
STANDARDS OF CONDUCT
continued
S. 112.323(4) Unauthorized
Compensation.—No public officer, (or)
employee of an agency…shall, at any time,
accept any compensation, payment, or thing
of value when such public officer, (or)
employee…knows, or…should know, that it
was given to influence…action in which the
officer, (or) employee…was expected to
participate in his or her official capacity.
BRIBERY, MISUSE OF
PUBLIC OFFICE
S.838.022 IT IS UNLAWFUL FOR A
PUBLIC SERVANT, WITH CORRUPT
INTENT TO OBTAIN A BENEFIT FOR ANY
PERSON…TO FALSIFY, OR CAUSE
ANOTHER PERSON TO FALSIFY, ANY
OFFICIAL RECORD OR OFFICIAL
DOCUMENT; CONCEAL, COVER UP
DESTROY…OR ALTER ANY OFFICIAL
RECORD OR DOCUMENT…”
BID TAMPERING
S.838.22 IT IS UNLAWFURFOR A
PUBLIC SERVANT, WITH CORRUPT
INTENT TO INFLUENCE OR ATTEMPT
TO INFLUENCE THE COMPETITIVE
BIDDING PROCESS…TO DISCLOSE
MATERIAL INFORMATION
CONCENTING A BID…WHEN SUCH
INFORMATION IS NOT PUBLICLY
DISCLOSED
BID TAMPERING continued
S.838..22 IT IS UNLAWFUL FOR A
PUBLIC SERVANT TO…ALTER OR
AMEND A SUBMITTED BID,
DOCUMENT OR OTHER MATERIALS
SUPPORTING A SUBMITTED BID, OR
BID RESULTS FOR THE PURPOSE OF
INTENTIONALLY PROVIDING A
COMPETITIVE ADVANTAGE…
BID TAMPERING continued
S.838.22 IT IS UNLAWFUL FOR A PUBLIC
SERVANT, WITH CORRUPT INTENT
…TO CIRCUMVENT A COMPETITIVE
BIDDING PROCESS…BY USING A SOLESOURCE CONTRACT…
ANY PERSON WHO VIOLATES THIS
SECTION COMMITS A FELONY…
PUBLIC RECORDS FRAUD
S.839.13 FS: “…if any…public officer, or
employee…of…a public agency, shall
falsify…any record…or shall knowingly
and willfully…conceal any issue, or
shall…falsify any document…or be in
anywise concerned therein, the
person…shall be guilty of a
misdemeanor…punishable as provided in s.
775.082 or s.775.083.”
OFFICIAL MISCONDUCT
S.839.25 FS: “(1) Official misconduct
means the commission of the following act
by a public servant, with corrupt intent to
obtain a benefit for himself or herself or
another or to cause unlawful harm to
another: knowingly falsifying, or causing
another to falsify, any official record or
official document. (2) Corrupt means done
with knowledge that act is wrongful and
with improper motives. (3) Official
misconduct …is a felony…”
AT YOUR SERVICE
A HANDOUT IS AVAILABLE LISTING ALL
STATE PURCHASING PERSONNEL, THEIR
ROLES AND TELEPHONE NUMBERS.
PLEASE DO NOT HESITATE TO CONTACT
US.
YOU ARE OUR CUSTOMER, AND WE INTEND
TO TREAT YOU AS SUCH.
[email protected] Director of State
Purchasing
[email protected] Chief Purchasing
Operations Officer