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Purchasing Process To Chinese Towson 072406

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  • 1. Overview of the Baltimore County Public Schools Office of Purchasing Introduction Program for Chinese Administrators at Towson University July 24, 2006 Rick Gay, RSBO Purchasing Manager
  • 2. Governing Authorization The annotated Code of Maryland sections 5-112 and 7-106, and the Maryland State Department of Education Financial Reporting Manual for Maryland Public Schools.
  • 3.
    • 3 rd largest school system in Maryland
    • 23 rd largest school system in the United States
    • 164 schools
    • 107,100 students
    • 2,514 English language learners
    • 13,808 special education students
    • 27,630 free and reduce-priced lunch students
    • 17,000 employees
    • 8,850 teachers
    Baltimore County Public Schools At a Glance
  • 4. BCPS Service Model
  • 5. BCPS Office of Purchasing Organization
  • 6. Purchasing Functions
    • Administer and Coordinate all agreements for the purchase of supplies, materials, equipment and (contracted services).
    • Enter into contracts with vendors to establish a fixed price to be used by all schools and offices for a specified period of time.
    • Distribute information on existing state, county and BCPS contracts to schools and offices.
    • Process all requisition/purchase order forms and catalog requests in accordance with established contracts to approved vendors.
    • Identify purchases which require the use of established quotations and/or bid policies or procedures.
    • Select potential award vendor in cooperation with the account manager. Submit the recommendation for award of contract to the Board of Education when appropriate.
  • 7. Purchasing Functions
    • Issue and distribute purchase order documents.
    • Encourage fair and equal treatment of all prospective bidders and vendors.
    • Maintain a list of qualified vendors and their respective vendor codes.
    • Observe procedures to identify and prohibit business transactions with any vendor whose past performance has disqualified their status by BCPS, county, state or federal policies, procedures and statutes.
    • Assure that purchases meet appropriate local, state, and federal safety and health standards.
    • Facilitate the prompt procurement of goods and services for schools and offices.
  • 8. 2006-2007 Goals
    • Expand the use of eCommerce and online purchasing.
    • Expand the number of catalogs on our eCommerce system
    • Establish internet access to announce and issue solicitations and expand vendor publishing.
    • Expand Vendor Self Service (VSS) to include the issuing of bids
    • Develop and execute an implementation plan for AMS Financial 3.6 procurement (web based)
    • Develop and implement purchasing database and prepare reports that enable the scheduling of renewals, track bids and contracts, etc.
    • Evaluate terms & conditions for bid specifications to support performance standards and enhance quality of goods and services.
    • Standardize contracts
    • Complete review and update of Board policies and Superintendent Rules to include vendor performance appraisal process
  • 9. Baltimore County Public Schools The Bidding Process
  • 10. The Bid Process
    • Bids must be advertised for two weeks.
    • The Purchasing Agents:
    • - Assists schools and offices in developing bid specifications.
    • - Evaluate bids received and submit recommendations to the Board for contract approval
  • 11. The Bid Process
    • The Office of Purchasing coordinates all BCPS bids and vendor contract negotiations
    • State law and Board policy require public bidding procedures to be followed for certain purchases.
    • The threshold for requiring bids is $25,000 – single item or system-wide annual needs
    • Curriculum and books are chosen through an evaluation process administered by the Department of Curriculum & Instruction
  • 12. The Bid Process
    • Other alternatives to bidding include:
    • - “ Piggybacking ” on contracts awarded by other public entities that follow public bidding procedures.
    • - “ Sole Source ” if proprietary or only available from one source. A sole source determination is made by the Office of Purchasing – and still must be submitted to the Board for approval.
    • - Purchasing consortiums/cooperatives
  • 13. Purchasing Procedures
    • Notify the Office of Purchasing of any item that may need to be bid
    • Plan in advance! - From start to finish the process of preparing, advertising, issuing, evaluating and Board approval can take 2 months or more!
    • If No Current Approved Contract Exists for the Item:
        • get two written quotes from vendors If a purchase is > $15,000 and < $25,000
        • If a purchase is < $15,000 get one written quote
    • Use on-line catalogs for available items
    • If less than $1,000 use a P-card
    • Contact Office of Purchasing if any assistance is needed
  • 14. Vital Statistics
    • FY 2001 Processed 245 bids valued at $145,808,709 Million
    • FY 2002 Processed 214 bids valued at $198,452,730 Million
    • FY 2003 Processed 236 bids valued at $174,878,485 Million
    • FY 2004 Processed 200 bids valued at $178,644,677 Million
    • FY 2005 Processed 223 bids valued at $214,775,000 Million
    • FY 2006 Processed 227 bids valued at $300,196,226 Million
  • 15. Baltimore County Public Schools Procurement Cards
  • 16. Procurement Cards
    • Having a Visa card is a privilege!
    • The card comes with responsibilities
    • Make necessary small (< $1,000) purchases
    • Ensure available budget $ prior to purchase
    • Not to be used for contracted services
    • Training is required for cardholders & Approvers
    • Retain receipts, logs, statements for 5 years
    • Procedures are on Office of Purchasing website
    • https://intranet.bcps.org/offices/purchasing/pcard_procedures/
  • 17. Procure – Procurement Card Management Software
    • The Office of Accounting:
    • Regularly monitors Visa card purchases and requests documentation from school/offices
    • Monitors compliance with reconciling requirements – Over 50,000 transactions annually!!
    • Sends memo’s to cardholder/principal when billed items are not reconciled timely
    • If necessary, sends second notice to Area Assistant Superintendent
    • CONTINUED FAILURE TO LOG AND RECONCILE TIMELY WILL RESULT IN FORFEITURE OF VISA CARD!
  • 18. Procure – Procurement Card Management Software
    • Cardholders must :
    • Log all purchases when made
    • Select proper budget account to charge
    • Reconcile billed charge to logged purchase - Reconciled charges are posted to Advantage Financial daily
    • Prior month charges must be reconciled by 20 th of the month
    • Print logs and forward with statement and receipts to principal for approval
    • Principal is accountable for all Visa purchases at the school
    • Common issues :
    • Purchases not logged
    • Billed charges not reconciled
    • Items charged to incorrect budget account (e.g. toner charged to “textbooks”)
    • Inadequate descriptions
    • Food/restaurant/catering charges – the description should include the purpose of the meeting and the attendees
  • 19. Total Dollar Amount Spent With BCPS Procurement Cards Per Year FY 97 – FY 05
  • 20. Total Number of BCPS Procurement Card Transactions Per Year FY 97 – FY 05
  • 21. eProcurement Electronic Purchasing From the Workstation to the Classroom at the Click of a Mouse…. Rick Gay, RSBO Purchasing Manager Baltimore County Public Schools
  • 22. BCPS Online Curriculum Catalogs
    • Web-based system to order necessary curriculum and instructional materials.
    • Includes textbooks and other frequently used instructional items.
    • Access to office/classroom supplies
    • through Office Depot, Corporate Express, and Rudolph’s – 80,000+ items
  • 23. BCPS Online Curriculum Catalogs
    • Over 25,000 curriculum items included in the catalogs
    • Searchable by title, item name, ISBN #
    • Catalogs may be printed for copying and distributing
  • 24. BCPS Online Curriculum Catalogs
    • Must attend training to get a user ID & password
    • Register for training through the PDC website
    • Know your budget account to charge before beginning
    • Orders are routed to principal for electronic approval – before they are sent to the vendor!
    • Vendor ships and charges your budget through Visa
  • 25. BCPS Online Curriculum Catalogs
    • Print copies of approved orders for delivery identification, verifying Visa charges, follow up off backorders
    • Training materials available on the Office of Purchasing web site:
    • https://intranet.bcps.org/offices/purchasing/pdf/BCPS-Online-Ordering-Training-Manual.pdf
  • 26. What is Online Procurement?
    • Online Procurement involves purchasing systems using software or applications that are &quot;Web&quot; or Internet-based connecting employees and suppliers making it possible to streamline and automate purchasing.
    • An Online Procurement network typically uses sophisticated technology that provides a secure marketplace, sales platform and transaction tracking system available only to selected buyers and suppliers.
  • 27. The benefits are real….
    • In a recent study of early adopters of eProcurement systems, the Aberdeen Group reported the following key benefits:
      • Improved data gathering and reporting on fiscal year expenditures
      • Tighter control over off-contract or “maverick” buying
      • Lower procurement administration costs
      • Shorter requisition and order fulfillment cycles
  • 28. eProcurement Solution Benefits
    • Expands sourcing and purchasing process to more buyers
    • Maintain control over process and approvals
    • Bring approvals and accounting codes forward
    • Integrates seamlessly with existing purchasing card process and tools
    • Reduces supplier costs to serve
    • Streamlines procure-to-pay, business processes
  • 29. Benefits for Employees
    • A well-designed eProcurement system provides employees with:
      • ready access to catalog information
      • the ability to requisition a product or service from their workstation computers
      • the ability to browse the product/service list
      • The ability to create a requisition/purchase order, without expending time and effort searching for missing information or tracking down specific people.
  • 30. Benefits for Purchasing Personnel
    • eProcurement frees purchasing personnel from:
      • clerical, order processing activities that are time-consuming and non-strategic
      • Allows them to focus on strategic activities, such as negotiating contracts with suppliers and analyzing purchasing behavior.
  • 31. eCommerce Suite On-Line Orders Summary Report Number of Orders Per Year FY 00 – FY 07
  • 32. eCommerce Suite On-Line Orders Summary Report Total Dollar Value of Orders Per Year FY 00 – FY 07
  • 33. Number of Suppliers Per Year FY 01 – FY 06
  • 34. Number of Purchase Orders Processed Each Fiscal Year
  • 35. BCPS Goals
    • Improved data gathering and reporting on fiscal year expenditures
    • Tighter control over off-contract or “maverick” buying
    • Lower procurement administration costs
    • Shorter requisition and order fulfillment cycles
  • 36. eProcurement Results
    • Order Submission
    • Delivery of Goods
    • Shipping Costs
    • Vendor Payment
    • Sourcing Consolidation
    • Real-time Notification to Vendors
    • 24-48 hours of Order Placement
    • 10-15% Reduction
    • 24-48 hours from Shipment
    • 33% Reduction of Catalog Surplus
  • 37. Overview of BCPS’s On-Line Program
    • Shoppers
    • Approvers
    • Administrators
    • Suppliers/Contracted Vendors
    • Unique Contracts
    • Line Items
    • 1202 Teachers
    • 577 Principals
    • 5 Purchasing Agents
    • 225
    • 299
    • 425,000
  • 38. BCPS Catalogs
    • Art Supplies / Photo
    • Athletic Equipment & Supplies
    • Audio Visual
    • Family Studies
    • Handwriting Materials
    • Library Media
    • Math Supplies
    • Media
    • Medications and First Aid
    • Music
    • Periodicals
    • Physical Education
    • Science Supplies
    • Technology Education
    • Textbooks
    • Unique Office Supplies
  • 39. BCPS Future Goals
    • Expand Catalog Offering
    • Add Tier 1 Suppliers
    • Grainger, Office Depot, Corporate Express, Rudolph’s
    • Expand and offer program to the surrounding counties
    • Leverage spending with local and national consortiums to negotiate improved pricing
    • Bid new contracts for the 2005-2006 FY
  • 40. BCPS eProcurement Implementation Plan
    • Develop and Deploy on-line catalogs
    • Deploy Vendor Self Service and on-line bidding
    • Offer additional on-line access to employees to vendors electronic catalogs
    • Integrate into a global ERP system
  • 41. eProcurement Process
    • Phase I (2000-2001)
      • began pilot operation with US Bank Pcard
      • 20 Schools, 5 Catalogs
    • Phase II (2001-2002)
      • All Schools using the same five Catalogs
        • Art Supplies
        • Science
        • Physical Education
        • Library Media
        • Audio Visual Supplies
      • 1951 transactions, 33 Vendors,valued at over $668K
  • 42. eProcurement Process
    • Phase III (2002-2003)
    • Increase to 13 catalogs with potentially 150 additional suppliers
      • Instrumental Music
      • Vocal Music
      • Technology Education
      • Medical & First Aide Supplies
      • Unique Office Supplies
      • Secondary Math
      • Family Studies
      • Art Photography
    • Incorporate lessons learned from FY 01
    • Implemented continuous product improvement methodology
    • enhance software to support the competitive procurement process and awards of bid
  • 43. eProcurement Process
    • Phase IV (2003-2004)
    • Increase to 23 catalogs with orders valued at $2.5 million with potentially 200 additional suppliers
      • Textbooks – Senior
      • Textbooks – Middle
      • Textbooks – Elementary
      • Textbooks – Special Education
      • Instructional Media _ Secondary
      • Instructional Media – Elementary
      • Instructional Media – Special Education
      • Football Equipment
      • Athletics
      • Instructional Software and Periodicals
    • Continuous ability of Curricular Offices to edit their Instructional Materials Catalogs
    • Incorporate lessons learned from FY 02
    • Continue to enhance software to support the competitive procurement process and awards of bid on-line
  • 44. eProcurement Process
    • Phase V (2004-2005)
      • Incorporate supplemental textbook and media catalogs into original online catalogs
      • Increased from 23 catalogs to 29 catalogs
      • Incorporate Office Depot/Corporate Express/BSN Sports/Grainger into eCommerce Suite Platform (Spending went from $129K in 2002 to $900K+ in 2003 – an increase of 856%!)
      • Add catalogs for AV Equipment,Computers, Douron & Glover Furniture, and Advance Business Systems & Imagistics Copiers
      • Conduct extensive feedback meetings with faculty & staff, and vendors regarding improvements for FY 2006
  • 45. Procure-to-Pay Process Management Sourcing Order Placement Payment & Settlement Recon- ciliation Audit & Control Reporting
    • RFQ
    • Catalogs/Contracts
    • Ordering Placement
    • Order Approval
    • Order History
    • Order Notification
    • Order Processing
    • Payment Processing
    • Payment Settlement
    • Automatic account code allocation
    • Order-transaction reconciliation & audit
    • General Ledger integration
    • Management reporting
  • 46. Procure-to-Pay Process Tools Sourcing Order Placement Payment & Settlement Recon- ciliation Audit & Control Reporting eCommerce Suite Purchasing Card AccessOnline
    • eCS Shopper
    • eCS Buyer
    • eCS Supplier
    • Purchasing Card
    • eCS Supplier
    • Order Management
    • Transaction Management
    • Financial Extracts
    • Data Exchange
    • Reporting
  • 47. Management Reporting Sourcing Order Placement Payment & Settlement Recon- ciliation Audit & Control Reporting Supplier Management Financial Management Tax & Compliance Management Program Management
  • 48. Buyer Places Order eCS Application Order Processed by Supplier Supplier Ships Complete or Partial Order Supplier Processes Visa Transaction Transaction Posts from Visa Transaction Management for eProcurement eProcurement Order Input File Order Matching & Reconciliation Buyer Performs TM Functions Reporting Tracking Analysis & Reference Standard TM Output File Map Data to Internal Systems U.S. Bank eCS Supplier U.S. Bank P-Card Management System Buyer Financial System U.S. Bank eCS Shopper eProcurement Transaction Flow
  • 49. On-Line Vendor Supply Catalogs
  • 50. Vendor Catalogs Available to Faculty and Staff via the BCPS Intranet
  • 51. Vendor Catalog registration page
  • 52. Questions?