3.2 TENDER FOR THE SUPPLY, INSTALLATION, AND SUPPORT OF A PROCURE TO PAY AND CONTRACT MANAGEMENT SYSTEM (CF ; MK:DW)

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1 Council Meeting, 28 August 2012 Section Page TENDER FOR THE SUPPLY, INSTALLATION, AND SUPPORT OF A PROCURE TO PAY AND CONTRACT MANAGEMENT SYSTEM (CF ; MK:DW) Responsible Director: Marilyn Kearney RECOMMENDATION That Council: 1. Accepts the tender of Dataweave Pty Ltd for the supply, installation, and support for one year, of the iprocurement Procure to Pay System by Dataweave Pty Ltd for the GST inclusive sum of $108,000; and 2. Accepts the tender of Open Windows Pty Ltd for the supply, installation and support for one year, of the Open Windows Contract Management System for the GST inclusive sum of $57,400; and 3. Authorises the Chief Executive Officer, at her discretion, to approve: a) additional 4 one X one year maintenance agreements for the iprocurement Procure to Pay System for the GST inclusive sum of $71,048; and b) additional 4 one X one year maintenance agreements for the Open Windows Contract Management System for the GST inclusive sum of $85,160; and c) up to a further $150,000 over five years, for software related services, GST inclusive; and 4. Authorises the Chief Executive Officer to execute the contract agreement. INTRODUCTION This report seeks Council s approval for purchase of a Procure to Pay software system and a Contract Management System. BACKGROUND Council has conducted a review of processes in Purchasing, Accounts Payable and Contract Management in light of Best Value principles. The outcome of the review in broad terms was the determination of best practice approaches to Purchasing, Accounts Payable and Contract Management utilising software systems. When implemented the proposed software systems will assist operations and ensure processes are best practice and efficient in order to handle current and future work volumes.

2 Council Meeting, 28 August 2012 Section Page 4 The proposed systems will facilitate a decentralised electronic purchasing and contract management function. This will include electronic sourcing of suppliers, ordering, and receipting of goods, works and services, and streamlining of the subsequent processing of payments. The outcome of the review and the recommendation in this report is consistent with the Council s information technology investment strategy. The project also aligns with the Strategic Objectives of the Council Plan, namely Our Community and Our People and Organisation. A Procure to Pay software package provides a self-service goods and services requisitioning system for Council staff to order goods and services. An application of this type allows automation and control of employee spending. A Contract Management System provides good governance in recording contract information and management of multiple contracts in a single system integrated with current financial systems. The proposal to implement a Procure to Pay System will support Council in: a) development of a standardised electronic process to replace the current paper-based one; b) removal of manual process and duplication of effort; c) facilitation of a decentralised model for electronic sourcing of suppliers, ordering, and receipting of goods, works and services; d) facilitation of the subsequent processing of payments; e) streamlining the Procure to Pay process to make it more responsive; f) ensuring that Council policies, approval processes and preferred pricing agreements are reflected in every transaction. The proposal to implement a Contract Management System will support Council in: a) recording contract information; b) contract administration and management of expenditure information through integration with the Monash financial system; c) removal of duplication of effort; d) ensuring the embedding of policies, business procedures and approval processes; e) streamlining contract management and administration. The introduction of the two software systems will be of benefit across the whole organisation with particular emphasis on buyers and contract managers. The scope of works included the following elements: Supply, installation, configuration, training and support of a Procure to Pay and Contract Management software system; Provision of implementation services, such as project management associated with the above;

3 Council Meeting, 28 August 2012 Section Page 5 Implementation and maintenance of the necessary interoperability between the proposed solutions and nominated corporate applications; Migration of required datasets from the existing system/s to the proposed solution; Provision of appropriate training for the different types of users; Ongoing support and maintenance of the implemented solutions; Appropriate functionality, value and cost effectiveness; Configuration of software for information exchange with the Oracle Financial System. PROCURE TO PAY AND CONTRACT MANAGEMENT SYSTEMS SOFTWARE REQUIREMENTS In order to achieve the project objectives, the Systems were required to possess the following capabilities: Ability to initiate the purchasing process from each user s PC Access to, and submission of, all purchasing forms via the intranet Support for all purchasing and accounts payable activities, including: o Raising of requisitions o Authorisation of requisitions o Raising of purchase orders o Receipting of goods and services o Matching of purchasing documents o Updating approval data to Oracle EBS for payment o Maintenance of vendor lists and catalogues of goods, services and contracts o Management of credit card activities Management of contracts Management and end user reporting Extensive use of workflow for the routing of all forms and information in the purchasing process Extensive use of workflow for the routing of all forms and information in the payment approval process Full integration with the existing Oracle EBS application Support for comprehensive reporting and analysis. PUBLIC NOTIFICATION The tender for the Procure to Pay and Contract Management software systems was advertised in The Age newspaper on 10 and 17 March The tender was also placed online at between 12 March and 30 March Tenderers were invited to respond to either: Part A Procure to Pay Management Software system; or Contracts Management Software system; or Submit for both Parts A and B.

4 Council Meeting, 28 August 2012 Section Page 6 TENDERS RECEIVED Tenderer Dataweave Pty Ltd ebms Pty Ltd Open Windows Australia Pty Ltd Computron Software Australia Pty Ltd Grosvenor Managing Consulting Pty Ltd System Tendered Part A & B Part A Part A & B Part A Part A Conforming tender pricing ranged from: Part A&B: $175,510 to $435,448 GST inclusive Part A (only): $133,310 to $179,048 GST inclusive (only): $142,560 to $315,800 GST inclusive TENDER EVALUATION PROCESS The evaluation panel consisted of: Dan Wade Manager Corporate Planning Danny Wain Manager Finance Services Mick Ross Manager Strategic Procurement Brian Lane Manager Information Technology In accordance with Council s Tender Evaluation Panel Terms of Reference, Conflict of Interest and Confidentiality forms have been signed by all Evaluation Panel Members. Other staff and contractors involved in the evaluation of aspects of the tender also completed Conflict of Interest and Confidentiality forms, which are located on the tender evaluation file. The tender evaluation methodology was based on a two phase process. The initial phase addressed price, functionality and experience. The second phase evaluated a shortlist of tenderers, which focused more on software demonstrations, site visits and reference checks. The price score was based on a five year cost. Phase 1 Evaluation Criteria maximum 90% Compliance with Functional Specification 15% Cost 60% Demonstrated Track Record 5% Implementation approach 5% Technical fit 5%

5 Council Meeting, 28 August 2012 Section Page 7 SHORTLISTED COMPANIES In order to establish the total cost of ownership over a five year period, a comparative financial assessment of the submissions was performed. Where necessary, additional information was sought from the relevant tenderer, including clarification of the pricing submitted. After this and the completion of the first phase of evaluation, a shortlist of tenderers was developed consisting of: 1. Dataweave Pty Ltd, 2. ebms Pty Ltd and 3. Open Windows Pty Ltd. These tenderers were evaluated in phase 2. Phase 2 Evaluation Criteria maximum 10% Compliance with Functional Specification (Product usability based on 5% product demonstrations) Cost reassessment based on total 5 year costs after clarifications - Demonstrated Track Record (Reference site visits and/or checks based on 5% criteria) Phase 2 of the evaluation process consisted of product demonstrations by shortlisted Tenderers and reference site checks for each of those Tenderers. DISCUSSION Dataweave Pty Ltd has been assessed, based upon Council s criteria, as best meeting Council s requirements for the provision of a Procure to Pay system and similarly Open Windows Pty Ltd has also been assessed as best meeting Council s requirements for the provision of a Contract Management System. After demonstrations and reference site visits/checks the proposed systems were found to have good performance and ability and good functional compliance scores for each of their offerings. The expertise and experience of each of the vendors was rated highly. The software product Dataweave proposes; (iprocurement), is an off the shelf module in the Oracle suite of products and is part of the Oracle Financial system that Council uses. During demonstrations, the functionality of the software was shown to be very effective and would be easily understood by those who will undertake its day-to-day use. Dataweave have also undertaken projects in the implementation of the iprocurement product in a similar fashion to how it is intended to be implemented at Monash.

6 Council Meeting, 28 August 2012 Section Page 8 The Open Windows product meets Council s requirements because it has the highest functional compliance and also the lowest total upfront and 5-year project costs due to Council already owning a perpetual license for Open Windows Contracts. Open Windows proposes an increase to 50 concurrent users to meet new usage requirements. The system is familiar to users and will be enhanced through integration with Council s Oracle Financial system. From a technology point of view, both products have an appropriate fit within the current IT environment. Overall the tenders of Dataweave Pty Ltd and Open Windows Pty Ltd were assessed as representing the best value for Council. FINANCIAL IMPLICATIONS The Dataweave contract price of $108,000 (GST inclusive) includes software installation and professional services. An additional four years of maintenance and support, is estimated at a GST inclusive sum of $71,048 in total. The Open Windows contract price of $57,400 (GST inclusive) includes software installation and professional services. An additional four years of maintenance and support, is estimated at a GST inclusive sum of $85,160 in total. A further provision of $150,000 (GST inclusive) is sought as a contingency for software related services across both Dataweave and Open Windows. These services could include business analysis and process review, additional maintenance, additional reporting requirements or further specialised training. Funds are available for this project from the approved 2012/2013 IT capital budget and the proposal is consistent with the Council s information technology investment strategy. The project aligns with the Strategic Objective of the Council Plan, namely Our People and Organisation. CONCLUSION The analysis confirms that Dataweave Pty Ltd and Open Windows have superior solutions and a high level of expertise and experience in implementation of these solutions in similar circumstances. It is recommended that Council award Dataweave Pty Ltd the tender for the supply, installation and support of a Procure to Pay System, and Open Windows the supply, installation and support of a Contract Management System both with four year maintenance contracts and four by one year support extensions at the discretion of the Chief Executive Officer.