National Institute of Mental Health
- Published: April 9, 2013
- Written by BPM.com
Executive Summary / Abstract
There is a critical need within the government to manage IT procurements in such a way as to ensure compliance with organizational and governmental standards, to secure the appropriate review and approvals for all such procurements, and to account for procurements and expenditures. To achieve this objective, the National Institute of Mental Health (NIMH), part of the National Institutes of Health (NIH), needed a more effective methodology and a more efficient business process for acquiring, tracking and managing IT equipment procurement. NIMH was able to accomplish this goal by designing a procurement process that supported compliance requirements, while also providing a comprehensive review and approval process for all procurements. To develop and implement that process, NIMH licensed business process management (BPM) software to automate and streamline its IT Procurement system.
IT procurement and investments for the Federal government are critical expenditures that must be closely managed and monitored. For NIMH, standardizing hardware and software procurements is a critical responsibility, as the Institute must concurrently manage its IT expenditures, improve support to its users and, at the same time, decrease overall (support) costs. This goal must be met while also addressing procurement requirements that are unique to the federal government. In addition, there are oversight and review process for all IT investments that are required by Capital Planning and Investment Control (CPIC). All Health and Human Services Operational Divisions, including NIH, must demonstrate compliance with the CPIC rules. To do so, a tiered review of every IT investment must take place. The goal of NIMH was two-fold: 1) To streamline the NIMH IT acquisition process and 2) Account for every expenditure and threshold. The Institute achieved this by developing a comprehensive, automated process that embraced the required workflow and signatures needed for each investment. Making that process consistent, accountable, timely, and efficient was essential to achieving the objective.
IT procurements at NIMH were, at one time, decentralized to business areas within the Institute. This decentralization, however, made it difficult to support the various technologies that were procured, enforce IT procurement rules, or to address the ongoing government-wide requirement for IT services, software, and hardware. As a result, the decision was made to centralize the IT procurement process. This centralization was initiated within the Information Resource and Technology Management Branch, which provided IT support throughout the Institute. In order to centralize the procurement process itself, however, there was a need to change the procedures, particularly those that were still manual, as those processes were difficult to enforce, audit, and report on. When it was agreed that automating the IT procurement process would be of significant benefit to NIMH overall, an internal review was held to identify alternative approaches. After reviewing and evaluating potential solutions, NIMH IT ultimately identified the software solution and approach we believed would be the most effective way to standardize the IT procurement process.
The Key Innovations
Business Management and oversight of IT procurements at NIMH needed to be more effectively administered in terms of technology oversight, standardization, compliance with procurement regulations, and cost containment. This required centralization of IT management and oversight, as well as budgeting and control. However, expediency and accountability needed to be part of the centralization plan so that IT procurements could still be done expeditiously while maintaining compliance with standards and controls. The automation of this process was the key to achieving these objectives. Those processes and automations included:
- Centralized IT Procurements to one organization
- Automated Review of IT procurements to ensure compliance with technical standards, procurement process, management, and oversight
- Automated the procurement process based on business rules and required approvals for IT procurement requests
- Full accountability for review steps and timeliness
The development of processes for managing IT procurements extended beyond the initial idea of ‘just’ automating current business processes. New processes were developed to address requirements and oversight of the IT procurements that were not in place previously. These included reviews for technology standards, review and approval of Requestor’s management, compliance with Federal IT procurement rules, and custom review procedures based on either the type of technology being requested and/or dollar thresholds being requested. Specifically, those processes included:
- Contextual, dynamic routing of requests based on requestor organization, investment type, and expenditure thresholds
- Fully auditable review and approval process
- Ability to enforce required request information and approvals
- Embedded Capital Planning and Investment Control (CPIC) compliance requirements
IT Purchase Request Workflow Diagram
The IT organization developed new roles and responsibilities to support this enhanced IT procurement process. These included technology review and approval, standards compliance, budget review, CPIC review, and procurement. The result was a consistent process with established roles and responsibilities, accountability of the organization in terms of following the process and expediency of request reviews, and documented compliance with the required reviews and approvals.
Specifically the organization gained:
- A centralized IT procurement review and approval process
- Documented compliance with IT procurement rules and requirements
- Streamlined IT procurement organization
- Improved support as a result of standardization
The centralization and automation of the IT procurement processes presented numerous challenges in the management customer service, customer expectations, and organizational performance. NIMH IT has to present the case for centralization and automation to the business community to ensure that its needs would be met in a timely manner, while reducing costs in terms of support and standardization. The specific hurdles included:
- Business resistance to centralized IT procurement process
- Meeting Federal Government IT procurement requirements
- Accounting (auditability) for compliance with IT procurement requirements
- Acceptance of an automated procurement request process
- Standardization of IT procurement technologies
Business Centralization and automation of IT procurement presented challenges to the business community in terms of requiring review and approval of their purchases in advance, with the decision being based on existing standards and procurement rules. Their biggest concern was not being able to order what they wanted, and not having those orders processed in a timely manner. NIMH IT was able to help these requesters address their needs by standardizing the IT procurement process and implementing an automated, fully accountable business process.
- Adapting to standardized technology procurements
- Provision of business case requirements for new acquisitions
- Submission of requests through an automated process
- Development and adaptation of a consistent IT procurement process
- IT procurement and review standards and staffing
- Budgeting and management of centralized IT procurement
The primary benefits revolved around cost accountability and savings, documented compliance with IT procurement rules, and increased productivity. This new approach to IT procurement enabled the IT organization to bring IT procurement into compliance with standards, reduce unnecessary purchases, and eliminate wasteful purchases overall. It also reduced the time required to account for IT purchases as well as the time required to process IT purchase requests. Specifics include:
- Reduction of non-standard equipment and software procurements reduced expenditures by 95%
- Reductions of non-required equipment reduced costs by 20%
- Cost to account for IT procurements to support government reporting and data calls were reduced by 50%.
- Time to review and process IT Procurement requests were reduced by 50%
- Time to report on procurements and compliance: 50%
- Reduced effort to procure IT services, equipment, and software
- Ability to report on IT Procurement status and demonstrate compliance with procurement and CPIC rules is greatly enhanced
- Use of standardized equipment and software has resulted in lower service call volume in addition to documented higher customer satisfaction ratings for technical support organization
- Automation of these processes ensures compliance with standards and improves the overall compliance status of the Institute
Best Practices, Learning Points and Pitfalls
Best Practices and Learning Points
- Conditional routing of requests based on request types and dollar thresholds were critical to the effectiveness of the application
- Broadening and expanding input to the form to include all aspects of procurement and property management substantially increased the impact of the application
- Extensive communication and training increased form utilization and compliance
- General user input during prototyping increased acceptance in the general usage community
- Complex procurement and accounting considerations increased complexity of the workflows
- Changing procurement rules required changes to forms and workflow logic
As a government agency, the advantages for NIMH reside in its ability to be compliant and accountable for all IT procurements initiated on behalf of the Federal Government and the American taxpayer. This form and workflow application (Process Director) has made a substantive contribution to NIMH’s ability to review, approve, and account for IT procurements. Compliance with standards in terms of the technologies themselves, as well as procurement and property regulations is now very high, and the Institute can now demonstrate that it is in compliance, is fully accountable and auditable.
- BP Logix– Process Director (BPM software
- Microsoft SQL Server RDBMS
- Oracle RDBMS
- Windows Server
The Technology and Service Providers
NIMH utilizes BP Logix Process Director business process management software (www.bplogix.com) to develop electronic forms (eForms) and workflows for the Institute, as well as to automate the review and approval process for its IT procurement requests. NIMH relies on the product’s eForm, workflow, meta data, Knowledge Views (reporting), Custom Tasks (prebuilt functional models ) and scripting (via APIs). By using APIs and web services, NIMH is able to integrate Process Director with other third party applications. We are also starting to deploy its Process Timeline functionality for our highly parallel, reproducible processes. The processes we currently have in place include both form-based (initiated by form submission) and workflow-based processes (or Knowledge View-based, which the workflow starts then attaches the form). The process functionalities we have utilized include sequential, parallel, parent-child, conditional, looping and customized.
Copyright: This case study was originally published in the Excellence in Practice series in the book entitled “Delivering Competitive Advantage” published by Future Strategies Inc. ©