NT SCOPA QUARTERLY MEETING INTEGRATED FINANCIAL MANAGEMENT SYSTEMS IFMS

NT/SCOPA QUARTERLY MEETING INTEGRATED FINANCIAL MANAGEMENT SYSTEMS (IFMS) Bobby Maake National Treasury 23 rd May 2007

Objectives Of The IFMS Project § To consolidate and replace aging financial systems with modern integrated financial management systems solutions § To develop systems solutions for the enablement of the implementation of the PFMA and new HR requirements § To refocus SITA towards its legislative mandate of Primary Systems Integrator (PSI)

IFMS Options SYSTEM OPTIONS ADVANTAGES DISADVANTAGES Customised Best of Breed COTS • Improves Functional fit • Allows system synchronisation with policy development • Improves competition in different functional spheres • • In-House Developed Systems • Control on functional fit • Control on system life-cycle • Synchronisation of system life-cycle to policy development • Control over functional fit vs change management • Control over development standards • May take long to deliver results • May lead to conflict over priorities • May compromise on industry standards and best practices Multiple Options Solutions • Provides for organisational autonomy • Centralised standards setting • High levels of duplications and costs • Risk of non-compliance to inter-operability standards • Difficulty to synchronise system developments to policy changes • May take very long to deliver results across all organisations • Fragments available skills levels Imposes Commercial Best Practices Turns project to in-house development Requires development of integration software Commits project to specific versions of COTS or unsynchronised system life-cycle for different COTS options • Commits system development to multiple COTS development environments • Requires effective change management strategy and highly skilled user community

IFMS Project Recommendations § The following areas to be developed in-house through SITA § Payroll Management § General Ledger and Financial Management § Supply Chain Management - Asset Management, Store Management, Maintenance Management etc § Business Intelligence Solutions – Management Reporting § The following areas to be bought as COTS § Procurement – e-tendering etc § Human Resource Management

IFMS SUMMARY PROPOSAL SUPPLY CHAIN MANAGEMENT PAYROLL (Develop) HUMAN RESOURCE MANAGEMENT (Buy COTS) STORE ASSET MANAGEMENT (Develop) GENERAL LEDGER/ FINANCIAL MANAGEMENT (Develop) BUSINESS INTELLIGENCE/ MIS (Develop) OTHER DEPARTMENTAL CORE SYSTEMS (Not part of IFMS) OTHER SCM MODULES PROCUREMENT (Buy COTS)

IFMS Project Implementation Strategy § Phase I covered the development of User Requirements and the Business Case for this project (Completed in March 2004) § Phase II of the project to focus on preparing SITA for its PSI role (18– 24 months) – Panel of expert advisor will be commissioned to asses SITA’s capability as PSI § Phase III will entail the development and procurement of the various systems components and their phased deployment (5 -7 years)

Cabinet Resolution of 14 Sept 2005 § Phase II & III of IFMS Project were approved as proposed § Current systems to continue to be managed by their owner departments (Do. D, SAPS, NW, Gaauteng, Limpopo etc) § Phase III will entail the development and procurement of the various systems components and their phased deployment (5 -7 years)

Progress To Date § Procurement Of the Integrated Development (IDE) toolset is about to be finalised (programming and system development tools) § Procurement Module tender is being evaluated. § HR Module tender has just been issued – closing date is end July 2007 § Systems Architecture and Specifications will be finalised in August 2007

Challenges § Access to appropriate IT skills by SITA § Access to appropriate functional skills by user departments § Alignment of policy implementation with rollout of system solutions § Alignment of departmental core systems with IFMS Architecture

Interim Arrangements § A stakeholder management structure has been developed and coordinated through a Steering Committee (TCF/Budget Council, GITOC and Domain Specialists) § Auditor-General has been appraised with the IFMS process to allow for alignment on reporting requirements by departments § Capacity on current infrastructure has been significantly (44%) upgraded to cater for increased transaction volumes § Essential enhancements have been effected to cater for A-G reporting requirements and salary adjustments § Procurement of COTS solutions reprioritised to be acquired during Phase II § Change Management for Domain Specialists Technical Team has commenced. Change Management for operational users will commence in October 2007.

THANK YOU DANKIE SIYABONGA RE YA LEBOGA