• TechAmerica/Deltek State of California IT Seminar Event Produces Some Surprises

    September 6th, 2012 by admin Categories: Blogs Tags: , , , , , , , , , , , ,

    TechAmerica/Deltek State of California IT Seminar Event Produces Some Surprises:

    • Negotiated procurement the new norm – PCC See 6611 Chapter 2 – Procurement Planning
    • Best Value replacing Low cost procurement
    • DGS, Tech Agency IT Procurement Roles/Responsibilities “developing”
    • State CIO chastises state & vendors for Bait & Switch pricing strategy

    Plus other comments on new FY2012-13 IT projects, WSCA, SEIU IT Insourcing Task Force, cloud computing, IPOC and IVV sourcing, GIS, mobility and IT governance.

    Some 250 state IT vendor and state IT officials crowded the Sacramento Sheraton for TechAmerica and Deltek’s 8th Annual State of California Technology Executive Seminar this week. As usual, it was a very informative affair with some rather surprising announcements from speakers including State CIO Carlos Ramos, DGS Director Fred Klass, DGS Procurement Director Jim Butler and Assemblywoman Joan Buchanan.

    State CIO and still California Technology Agency Secretary Carlos Ramos announced over $800 million in new IT initiatives included in departments’ new Information Technology Capital Plans (ITCP), and this was only “reportable” projects, he added. Carlos also provided an overview of IT procurement developments, and even pre-warned the audience that he was going to level some constructive criticism on both state officials and the IT vendor community for what he described as a “Bait & Switch Strategy” in IT procurement. This of course is the well-honed and time honored tradition whereby state departments develop unrealistically low IT project budget figures, often in order to facilitate Department of Finance approval; and bidding vendors are only too happy to accommodate, and often exacerbate the problem by doubling down with their own low-balled cost proposals, with both parties, vendors and departments alike, anticipating the ever ameliorating graces of the Special Project Report (SPR), or change order, to increase the budget and bail them out.

    To address this situation Carlos plans to introduce a new focus on a “best value” rather than the traditional low cost procurement strategy with more emphasis and accountability expected from state contract managers. Good idea.

    Given this new policy, some in the audience including TechLeader.TV were surprised during Carlos’ following remarks when he highlighted the fact that the budget of Fi$Cal Project, the state’s new enterprise financial system, had been reduced from $1.6 billion to “only” $600 million.

    DGS Director Fred Klass unveiled the heretofore rather esoteric Public Policy Code 6611 which we’ll be hearing a lot more about in the days ahead. It is the basis for authorizing and emphasizing the negotiation process during procurement. His presentation and in the Q&A, and our discussions with him and Carlos afterwards also indicated that the process of migrating IT procurement from DGS to the Technology Agency is, as they say, a “work in progress”.  The wording of the legislation in AB1498 which called for this shift in IT procurement responsibility has itself sown the seeds of confusion by stating that the law “becomes effective on July 3, 2012, and operative on July 1, 2013”. This will make for an interesting year for DGS and the California Technology Agency.

    Another topic of interest but not covered in the formal presentation involved the Budget Task Force empowered by the Brown Administration to cancel or bring “in-house” IT projects deemed to be able to be performed by state employees.  TechLeader.TV covered this extensively here Budget Task Force Union Representatives Double List of IT and Other Service Contracts for Cancellation: Now at $2 Billion two weeks ago.

    Assemblywoman Buchanan in response to an audience question downplayed the impact of this exercise stating that major IT initiatives like Fi$Cal were unlikely to be affected. She said that she has “no fear that this process will have the Administration bringing major IT projects in-house”. Well, is this just whistling past the graveyard, or is there cause for real concern among state IT vendors? This story is developing…

    There was also discussion of: new developments regarding the state’s WSCA relationship which State Purchasing Chief Jim Butler explained were being satisfactorily worked out; OTech’s cloud procurement which is progressing with an RFP on the horizon, and look for an externally hosted solution procurement to follow, and perhaps even a federal-type “cloud-first” strategy  down the line; independent oversight (IPOC) will continue to be brought in-house, while IV&V will still require the services of outside consults. And finally get ready for the GIS GeoPortal in January 2013, an “internet-based resource with an intuitive user interface where government agencies, private industry, and the public can easily find, access, view, and share geographic information. The state Geo Portal will serve as a primary access point for all 3,700 of the state’s geographic information”.

    All in all, another very informative event arranged by our TechAmerica host and TLTV friend, Carol Henton. Can’t wait for next year!


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