Agenda Index City of Vancouver

ADMINISTRATIVE REPORT

TO: Vancouver City Council

FROM: General Manager of Corporate Services Group in consultation with the General Manager of the Vancouver Park Board and the Manager of Materials Management

SUBJECT: Award of Request for Proposal PS02027 - Implementation of SAP Plant Maintenance and Asset Management Modules

RECOMMENDATION

A. That Council approve an increase in the budget for the implementation of the SAP Plant Maintenance and Asset Management modules by $67,000 to $875,000; source of funding to be provided in advance of the 2003 Capital Budget.

B. THAT Council authorize the General Manager of Corporate Services to enter into negotiations and, subject to achieving a contract satisfactory to the Director of Legal Services, to conclude an agreement with Deloitte Consulting to provide consulting services to assist the City with the implementation of the SAP Plant Maintenance and Asset Management modules for Building/Property management at a cost not to exceed $475,000 (plus the Goods and Services Tax less the anticipated receipt of the municipal rebate); source of funding to be the PM/AM Modules project budget approved in the 2002 Supplementary Capital Budget.

CITY MANAGER'S COMMENTS

POLICY

Contracts are awarded on the basis of best value to the City. Contracts with a value over $300,000 are referred to Council for approval.

BACKGROUND

The City purchased SAP to provide a single enterprise system to support all core business processes including financials, payroll, human resources, materials management and facilities/maintenance management. SAP Plant Maintenance (facilities/maintenance management) is an important component of a SAP implementation.. The implementation of the Finance, Materials Management and Human Resource/Payroll modules represented an appropriate first step in achieving the City's objectives.

With the original modules now stabilized, it is important to continue the evolution of SAP functionality. The implementation of PM/AM (Plant Maintenance / Asset Management) will provide the City with enhanced control over the management of its facilities and will replace a number of existing stand-alone systems.

Phase one involves configuring the PM and AM modules to support all City building management. This phase will replace the Mainsaver maintenance system (used by Corporate Services - Building Services), the Park Board Building Maintenance system as well as the mainframe Real Estate system. Subsequent phases involve further expanding the system to accommodate additional Real Estate Services requirements (property/tenant management) as well as the maintenance of the City's remaining infrastructure (ie: Engineering facilities). This report and recommendation relates to phase one.

DISCUSSION

The City has extensive property holdings that require ongoing maintenance and tracking. Currently, building maintenance and property asset information is maintained on a number of different computer systems (Park Board Maintenance, Mainsaver, Real Estate mainframe and various individual spreadsheets).

None of these systems is integrated with each other or with the City's financial systems. This causes inefficiencies in maintaining multiple systems and reconciling data; duplication of data across the various systems; double entry of time and materials and questionable data integrity resulting from the absence of one common database for all asset and maintenance information.

In addition, the Park Board computerized maintenance management system has reached the end of its service life. It was developed `in house' many years ago and is based on old technology. It is now very difficult to operate and support, has become unstable and is not integrated with other operating systems. A replacement system is urgently needed to provide efficient maintenance management for Park Board properties and buildings.

The Building Services, Facilities Development, Real Estate, Park Board Building Maintenance and SAP Business Support divisions have collectively examined two main alternatives for system replacement and integration. One alternative involves extending the Mainsaver system to all City building management operations and constructing customized interfaces to SAP in order to integrate financial and materials management information. The second alternative involves configuring the SAP PM (Plant Maintenance) and AM (Asset Management) modules, which the City already owns, to replace the existing building and property management systems. The Business Application Committee, an internal management group that oversees technology requests, supports the SAP alternative as it provides a superior solution at less risk and expense. The Corporate Management Team has also endorsed this solution. In addition, this alternative is consistent with the City's long term systems policy of `SAP First' in replacing existing systems.

The SAP solution involves configuring the PM module to manage all building related maintenance for the City and the AM module to track all City land and building assets. The solution is also intended to provide a basic interface between SAP and the City's Geographical Information System (GIS) that will allow SAP users to easily call up graphical representations of assets.

To complete this configuration it is necessary to retain the services of experienced, trained and certified SAP PM and AM external resources to assist with the project and to provide knowledge transfer to City staff. If approved, all previous stand alone systems will be replaced during 2003.

PROPOSALS

Proposals were sought on the basis of a set of defined requirements. An evaluation team made up of staff from Financial Services, Building Maintenance (City and Park Board), Fire, the SAP business support group and Materials Management assessed the proposals against the following criteria:

Three firms were short listed and were requested to submit revised pricing based on having City resources fulfil all change management and SAP technical programming roles. Revised pricing is as follows:

The evaluation team considers the Deloitte Consulting proposal to be superior in terms of relevant implementation experience; the background and experience of the resources proposed; and in their overall approach to the City's business needs. In addition, Deloitte proposed resources that met the training and certification requirements of the RFP.

It is recommended that Deloitte Consulting provide the required resources for this project as their proposal offers the best overall value to the City, and that the General Manager of Corporate Services be authorized to negotiate a contract satisfactory to the Director of Legal Services.

FINANCIAL IMPLICATIONS

The 2002 Supplementary Capital Budget Report that was approved by Council on May16, 2002 stated:

The estimate of $808,000 was prepared early in the year. Since then, more detailed analysis was done on the scope and the efforts required to maximize the use of GIS. Additional funding is required for the evaluation phase and the development of a basic interface between SAP and the City's GIS platform to ensure that geographical representation of data is an output of the project. To provide for the GIS interface, the total project cost is estimated to be $875,000.

This report recommends funding not to exceed $475,000 from the project budget for consulting services from the preferred vendor. Negotiations with Deloitte Consulting will confirm the final contract amount. The balance of the project budget - $400,000 - will be used for GIS interface, backfilling, data conversion, licensing and training.

CONCLUSION

The City's building and property management divisions require the SAP PM and AM modules to replace the existing systems and to integrate maintenance, property and financial information. The recommendation to engage Deloitte Consulting to assist with the implementation of these modules provides best value to the City.

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