T-12 Improving IT Financial Transparency

IPMA Forum 2012 T-12 Improving IT Financial Transparency Insights into managing IT spending Tuesday, May 22 1:00PM-2:00PM

Moderator: Larry Dzieza, Office of the Chief Information Officer

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Strategic Action 2: Improve Accountability and Insight into IT

• Purpose of this session is to present a little and listen a lot.

• Your participation in sharing your insights and questions are needed. • What are the IT financial issues driving your organization?

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Strategic Action 2: Improve Accountability and Insight into IT OCIO Lead: Larry Dzieza & Bob Zych, OCIO Agency Lead & Executive Sponsor: Bharat Shyam, OCIO The following objectives are part of the strategy: – Work with DES to lead a transparency and accountability initiative • Help agencies learn more about their IT spend • Drive improvements

– Partner with OFM to present an IT budget that is more transparent than in the past

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The Context of IT Financial Management

The Legislature interest in IT financial issues has never been higher. OFM has initiated several efforts to set a better foundation for ITFM. • Tracking IT spending in AFRS (X,Y coding) • Introducing state agencies to Gartner’s total cost of ownership model. • Convening a collaborative IT data improvement effort

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IT Improvement Direction • Make information about IT spending visible and meaningful. • Less one-off, one-time data wrangling, more reliance on systems of record; • Move beyond data for compliance and provide tools to improve IT management and ops; • Provide both an agency and an enterprise perspective on IT spending and metrics; and • Mine the data to drive decisions, inform opportunities for improvements, justify investment asks and save money. 5

Hard Earned TCO Knowledge

Enter Apptio • Our Gartner total cost of ownership effort was the first phase in a greater effort to achieve a better understanding of our agencies’ IT cost. • The result: Overall, we are in-line with the other “federated” IT enterprises. • We knew that there are tools available that can ease the data reporting burden, provide greater insight, model alternative approaches and help plan for the future. • We are progressing to complete an agreement with Apptio to provide a tool for all agencies to use. 7

Apptio Builds On Your TCO Knowledge

Apptio Builds On Your TCO Knowledge

Phase 1 Deployment - High Level Scope • Objective: Ready to support State budgeting activities in late Oct / Nov; transform IT through financial transparency and accountability • Time Period: May – Oct 2012 • Financial Transparency: – CTS: provide improved Bill of IT for IT Services delivered to other State of WA agencies – Top 45 agencies: provide high level service costing analysis of IT operating expenditures; analysis at the financial, resource tower and service category views – Create standard costing structure to analyze, compare and consolidate agency budgets across multiple models

• 2013 Budgeting – Use existing budgeting process for agencies submission in August – Configure Apptio Budget & Finance model to import, consolidate and present parallel view of IT 2013 budget submission

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Phase 2 Deployment - High Level Scope • Objective: Transform IT across the agencies to focus on Service Optimization and reduce the State’s overall IT spend

• Time Period: Nov 2012 – Mar 2013 • Service Optimization – CTS: visibility into infrastructure utilization and service costs to provide better information to make decisions on transitioning other agency infrastructure services to CTS – All agencies: deeper analysis into application TCO and infrastructure utilization and costs – CTS: transition to a chargeback Bill of IT to the State agencies – DSHS and DES: provide showback Bill of IT to the department heads within their agency for the IT Services delivered to support the agency

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Proposed Deployment Agency Grouping: Month Agency Count 1 10 2 10 3 11 4 10 5 2 6 2 Grand Total 45

Sum of Annual Budget $ 528,438,630 $ 85,744,949 $ 204,587,829 $ 107,351,271 $ 51,727,940 $ 10,820,715 $ 988,671,334

Avg of Annual Budget % of Annual Budget $ 52,843,863 53.4% $ 8,574,495 8.7% $ 18,598,894 20.7% $ 10,735,127 10.9% $ 25,863,970 5.2% $ 5,410,358 1.1% $ 21,970,474 100.0%

Comment Top priority, agencies to provide TBMAs Next priority, " " Next priority, " " Next priority, " " Next priority, " " Low priority, may limit to GL reporting

List of Agencies by Group (descending order of IT Spend) Month 1 Agency Department of Social and Health Services Consolidated Technology Services Department of Employment Security Department of Enterprise Services Department of Labor and Industries Department of Corrections Department of Transportation Department of Health Department of Revenue Department of Licensing

Month 4 Agency Liquor Control Board State Investment Board Community and Technical College System Office of the Insurance Commissioner The Evergreen State College Office of Administrative Hearings State Lottery Commission Washington State Criminal Justice Training Commission Recreation and Conservation Funding Board Washington State Gambling Commission

Grouping Over30M Over30M Over30M Over30M Over30M Over30M Over30M Over10M Over10M Over10M

Month 2 Agency Department of Ecology Department of Natural Resources Department of Veterans' Affairs Washington State Health Care Authority Department of Retirement Systems Washington State Patrol State Parks and Recreation Commission Department of Agriculture Department of Fish and Wildlife Superintendent of Public Instruction

Month 5 Grouping Agency Cabs Eastern Washington University OCIO/COE Washington State University HiEd Other HiEd Cabs Cabs Cabs

Central Washington University Higher Education Coordinating Board Western Washington University

Grouping Over10M Over10M OCIO/COE Other Other Over10M Other Other Other Over10M

Month 3 Agency University of Washington Military Department Department of Financial Institutions Western Washington University Department of Early Learning Department of Commerce Office of the Attorney General Utilities and Transportation Commission Board of Industrial Insurance Appeals Office of the State Treasurer Office of the State Auditor Office of the Secretary of State

Grouping HiEd Other Other Other Other Other OCIO/COE Cabs Other Other Other

Grouping HiEd HiEd HiEd HiEd HiEd

Cabs Cabs

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Moderator:

Larry Dzieza, OCIO

Panel Members: Bharat Shyam, OCIO Greg Leskinen, Apptio Bob Zych, OCIO 13