Observatory Case
Study: State of South Carolina Budget & Control Board
The South Carolina Budget & Control Board used our
services to deliver improved spend and contract visibility. We
talked to Norma Hall, Program Manager, Strategic Planning, about
her experience to date.
"Like many other states we’ve been struggling with how
to access spend analysis data and contract visibility economically
statewide. Once we saw the Spikes Cavell Observatory it was obvious
to us that it had the potential to solve the statewide visibility
issue."
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Tell me a little bit about your agency?
I work for the SC.
Budget and Control Board (BCB) which provides administrative,
technical and consulting services to South Carolina’s state
agencies. The BCB is responsible for setting broad policy for and
through its ten divisions. One of those divisions, the Division of
Procurement Services, Materials Management Office (MMO), is
responsible for procurement services.
Can you describe your procurement function and where
and how it fits into the organization?
The MMO oversees
all procurements in the state of South Carolina. Most of the state
agencies have a level of delegated procurement authority -
anywhere from $50,000 to multiple $m’s depending upon their
certification. Our interest is principally in procurements for
states agencies that are above their certification level and
procurements that have the potential to benefit all agencies within
the state, as well as all political subdivisions.
What do you see as the top three challenges for procurement
at South Carolina Budget and Control Board over the next
12 months?
Addressing the opportunity presented by more effective
statewide collaboration is at, or near, the top. Deployment of the
Spikes Cavell Observatory across an initial seven of the state
agencies has already established beyond any doubt that the
opportunity to deliver savings has the potential to be very
significant.
Beyond that we’ll be continuing to invest time and effort
addressing ‘maverick spend’ - we’ve begun using the
Observatory to upload contracts and join it to the spend data. Not
only does this have the potential to deliver a statewide register
of contracts that includes local as well as state contracts, we can
quickly and easily identify the categories where there is a
contracted vendor but a lot of spend with other vendors.
Understanding why that is and taking corrective action where
appropriate will not only save money but will reduce the
administrative burden too.
You've been working with Spikes Cavell to deliver
improved spend visibility. What were you hoping to achieve when you
undertook the data transformation and spend analysis
project?
Like many other states we’ve been struggling with how to
determine spend and contract visibility economically statewide.
We’ve been implementing SAP for a while now and have made good
progress. The implementation statewide was conducted over several
years with the majority of agencies not being on the system for a
full year to date. However, while SAP is a great ERP system,
since it is in its infancy in data collection, and the fact that
prior to its implementation each state agency had its own system we
didn’t have a central repository to gather the information we
needed to really drive procurement improvement. We have hundreds of
state agencies and bringing all that spend together in one place
and then being able to leverage it remains a priority.
Once we saw the Spikes Cavell Observatory it was immediately
obvious to us that it had the potential to solve the statewide
visibility issue within minimal time. We invited a small number of
state agencies to participate in a pilot deployment and our first
priority was to analyze common spend.
What has better spend visibility enabled you to achieve
to date?
The most significant achievement to date has been the
identification of opportunities to initiate bid processes in
several previously overlooked categories. We’ve already started to
deliver savings by rationalizing the number of vendors in a
category and getting better terms from the smaller number of
vendors from whom we’re now purchasing.
What are you anticipating better spend visibility will
help you achieve in the future?
As well as identifying a number of savings opportunities
that we’re now pursuing it has helped in an unexpected way.
Analysis of spend with contracted vendors threw up an apparent $1m
spend with a furniture contractor with whom it appeared we didn’t
have a contract. After some investigation we discovered that there
was a statewide contract but our ERP system wasn’t collecting all
of the data that was needed. Without the Observatory we wouldn’t
have known that this was something that needed to be
addressed.
We’ve also made some progress identifying opportunities
where the common spending is specialized and likely to mean that a
cooperative (multi) state agency contract for higher education
located in a specific area within the state may be
negotiated and might be more effective than something
statewide. Higher Education in particular has always
maintained that what it buys is different than the rest of the
agencies in the state. Analyzing the data for Medical University,
Trident Technical College and Citadel (who all participated in the
pilot as a group) was illuminating. It was clear that there are
areas where a locally established cooperative multi-agency contract
would be better. Equally though it illustrated that there were was
also plenty of scope for Higher Ed to benefit from statewide
contracts already in place.
The state is now working with the CHEPA (the Charleston
Higher Education Procurement Authority) group and delegating
authority on a case by case basis so that CHEPA is able to leverage
the data in the Observatory to identify common spend and contract
as a group of four (the College of Charleston didn’t participate in
the pilot but it plans now to deploy the Observatory).
Very approximately, how much ($) has better spend
visability enabled you to save to date?
It’s a little early to have formally assessed the value of
$’s saved but what is clear is that it has that improved
identifying statewide spend and contract visibility and has
the potential to deliver many, many $m’s of savings for the
state.
Do you think you could have undertaken the data
transformation and spend analysis project without external
help?
We understand that this functionality is available with SAP,
however, the immediate concentration has been on implementing the
system statewide and data is just beginning to be collected.
Until enough data is collected and all agencies have been on the
system for at least one year, the data will not be
comprehensive. While the SAP system will give us data on all
state agencies it will exclude all of the colleges and Universities
in the state, as they are not participating in the SAP
system. So in short, no. There are solutions out there that
are quicker and can aggregate data from multiple systems and are
very reasonable in cost.
How did you find working with Spikes
Cavell?
Very easy. The data requirements weren’t
challenging so we were able to get the extract done quickly and
with a few man-hours effort on our part. The cleansing,
classification, enrichment and collation was done in around 6 weeks
without any need for input from us. The next thing we know we’re
being presented with our transformed spend data in the
Observatory.The Observatory is intuitive and easy-to-use, we were
running reports and analyzing spend within minutes of
publication.
You have one word to describe Spikes Cavell to a
colleague or peer. What would that one word be?
Reliable. Very reliable. You do what you say
you’re going to do, when you say you’re going to do
it.
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About the State of South Carolina Budget and Control Board
South Carolina borders Georgia to the south, North Carolina to
the north, and the Atlantic Ocean to the east. According to the
2010 United States Census, the state is ranked 24th among the U.S.
states by population, at 4,625,384 people. South Carolina contains
46 counties and its capital is Columbia.
www.bcb.sc.gov
Published: 12/9/2011
TAGS: state of south carolina budget and control board, spend visibility, observatory, procurement