A N D S O L U T I O N S F O R L O C A L G O V E R N M E N T M A N A G E R S VOLUME 44/NUMBER 1 2012
S T R A T E G I E S
In
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utsourcing may appear to be the perfect strate-gic sourcing solution for governments that are running out of resources or otherwise having dif-ficulty balancing their budgets. Of the many areas frequently considered for outsourcing, information technology (IT) is generally one that ranks high on the list. Although outsourcing of IT can achieve significant benefits, it is not a “silver bullet” for solv-ing systemic financial and operational issues such as reducing costs and improving services throughout an organization. Resolution of these two areas requires strategic planning and a clearly defined design in which roles are well delineated for solving these complex problems. To minimize the risks associated with outsourcing of IT, local government managers can benefit from the advice of peers with experience outsourcing IT and the expertise of consulting and accounting firms that have facilitated the execution of strategic sourcing transactions.This InFocus report is a guide to those steps most commonly used by local governments making decisions about IT strategic sourcing. This includes knowing the best way to determine whether out-sourcing all IT operations or a portion of IT opera-tions is a helpful option for achieving cost reduc-tions and service improvements.
Alignment of business objectives: Should we outsource IT?
Local governments today search frantically for financial rescue during an economic downturn that has strangled their budgets and forced layoffs as they face reduced tax rev-enues and escalated demands for services. Many, already pushed to near bankruptcy, are figuring out how to provide services with less; they are turning to outside sources to pro-vide services at a lower cost while attempting to maintain service levels to keep up with continuously increasing demand.
Generally, the justification for outsourcing is to reduce costs, improve efficiency, and leverage external expertise and best practices in order to free up management and other resources so the organization can focus on its core competencies. In practice, the idea works and many local governments obtain significant cost savings by hiring outside con-tractors or leveraging relationships with neighboring jurisdictions to handle specific tasks such as trash collection and other services that had been performed within a local gov-ernment’s jurisdiction.
IT is an area that has received significant attention as an area of opportunity for achieving the benefits of outsourcing. The management of technology can be very time-consuming and complex. This is why many organizations use third party outsourcing firms to perform these functions so they can remain focused on their primary services to residents and reach accepted goals through the outsourcing process. This report and the content from the Plante Moran webinar on government outsourcing serve as viable resources to government agencies that are making the transition from in-house IT opera-tions to IT outsourcing.
Current situation
IT outsourcing is a $250+ billion dollar industry projected to grow by 7 percent annually. Key drivers of IT outsourcing are the potential for cost savings, service level improve-ments, and risk transference. This data coincides with our detailed analyses and findings in working in the governmental marketplace.
As IT budgets come under pressure and new technologies are introduced, organiza-tions turn to service providers, both onshore and offshore, to meet more of their needs. For some organizations, the needs are short-term and tactical, enabling the organization to increase in-house capabilities without making long-term commitments or large capital investments. In other cases, the decision to outsource is strategic and follows a careful
DennisBagley has more than twenty years of experience in the IT industry involving consulting to public sector and other organizations. His experience includes assisting clients in operations and IT initiatives involving strategic sourcing, IT strategic planning, enterprise resource planning (ERP) needs assessment, ERP selection, and contract review and negotiations. He also has significant experience assisting clients with IT assessments with a primary focus on organization, staffing, governance, and application software. Dennis has also been a project manager for major IT initiatives including systems implementation and process redesign. He holds a BS degree in computer science and an MBA from the University of Michigan.
Plante Moran provides independent technology consulting for ERP selection and implementation and strategic technology planning projects. They have served government organizations for more than sixty years, and are among the largest consulting and certi-fied public accountant (CPA) firms in the nation. We specialize in helping local govern-ments minimize risk and maximize their investment in technology.
analysis predicated on improvement of service levels and/or reduction of costs. The most popular approach is to perform partial outsourcing in which certain IT functions deemed as a commodity or riskier in nature are outsourced while keeping more strategic func-tions within their control.
As a rule, the decision to outsource components or a complete IT function to a third party results from management exploring the possibility of reducing costs or improving effi-ciencies while focusing on their primary missions instead of managing the details of IT.
Local government leaders involved in strategic sourcing should be able to respond positively to these seven questions before making the transition to IT outsourcing:
1. What is the problem we’re trying to solve and would outsourcing some or all of our IT operations solve it? For example, is the organization trying to improve service lev-els, gain access to specific skills, and/or reduce costs?
2. Is the IT infrastructure (e.g., network, servers, datacenter) configured to support out-sourcing? For example, is the IT infrastructure using standardized components such as a common manufacturer for network electronics and servers?
3. Is there an IT governance model in place so that accountability and decision making can take place?
4. Is there significant cost savings with IT outsourcing compared to the in-house model even after factoring in transition costs?
5. Are there people in the organization who have the skills and experience to manage IT outsourcing providers?
6. Are there appropriate accountabilities in place to ensure a successful transition to IT outsourcing?
7. Does the organization have political support from its elected officials to proceed with an outsourcing plan that will to some small or large degree privatize functions that until now had been performed internally?
Benefits and challenges with IT outsourcing
IT outsourcing is more complex and multidimensional than most other types of outsourc-ing because IT itself is a multipurpose and complex function. Unlike many functions of local governments, IT typically supports all departments across the organization and must provide these departments with solutions and information that require complex data sets from multiple sources. These complexities result in a number of potential benefits and challenges that many governmental entities cite for either pursuing or not pursuing.
Benefits
Plante Moran’s experience with local government jurisdictions shows that when the fit is right, the rewards of outsourcing come in a variety of ways. For example, several client organizations outsourced their email systems to take advantage of new features such as group calendaring and to achieve a positive return on investment over a five to ten year time horizon. Benefits of IT outsourcing can include:
• Reducing IT costs through economies of scale. For example, IT outsourcing provid-ers use centralized data centprovid-ers to leverage their services across multiple organiza-tions resulting in certain economies; some of which are passed onto their customers as cost savings.
• Infusing cash by liquidating assets. In some instances, outsourcing providers will purchase assets such as servers, wireless network equipment, etc., resulting in a cash infusion for the customer. Typically, assets are purchased at or below market cost for the depreciated asset.
• Avoiding or transferring risk. When the criticality of systems exceeds the capacity of the organization to maintain appropriate redundancy (i.e., duplicate systems that kick-in when the primary systems fail), oftentimes, the organization will seek the services of an outsourcing provider who can accept and mitigate the risk more effectively. • Avoiding cultural issues. If grappling with cultural issues involving elements of an
IT organization such as disagreement on strategic direction, sourcing the services to a third party under a mutually agreeable service level agreement can help an organiza-tion circumvent these issues.
• Allowing management to focus on core business competencies. Time and resources that aren’t spent keeping up with technology can be put to good use on other impor-tant business issues.
• Creating new technology competencies within the organization while having access to an entirely new breadth of technology and IT talent. IT outsourcing pro-viders will typically bundle services and technology together so that an organization experiences improvements in both.
• Upgrading the level of service and service quality. Organizations can negotiate service level agreements with IT outsourcing providers that may represent a vast improvement over what they are currently receiving in terms of both level of service and quality of service.
• Achieving a better return on IT investment. In terms of IT, return on investment refers to the value of services provided versus the cost of these services. Depending on an organization’s current portfolio of IT services and cost containment strategies, the return on IT investment can be improved through outsourcing. Keep in mind that optimizing service value is not the same thing as maximizing service levels; e.g., the IT operation may deliver a well-tuned, high functioning software application that does not deliver comparable benefit or worse, over complicates processes.
• Leveraging the availability of current technology to improve the efficiency and effectiveness of staff operations.
• Capitalizing on the opportunity to learn about industry best practices in how tech-nology is efficiently managed.
• Accessing potentially more current and diverse skill sets than would be obtained from hiring new staff or retraining existing staff. IT outsourcing providers typically employ a broad range of specialists whereas it would be cost prohibitive for an orga-nization to do the same.
Challenges
Plante Moran’s experience with local government jurisdictions shows that there are cer-tain challenges to IT outsourcing scenarios that must be properly managed such as:
• Managing the cultural and other people-related issues inherent with organiza-tional change and transition. When transitioning any services to a third party, man-agement must utilize change manman-agement tools and techniques to properly manage expectations of both internal staff and the service provider. Communication from management should be clear relative to how people’s jobs are affected during and after the transition. Communication should continue but taper off during the ‘steady state’ (i.e., typically after six months have elapsed).
• Determining relevant costs; new costs can be introduced if changes are required. If organizations actually know their costs in providing IT services, this would be so much easier, but most times they don’t. Plante Moran typically recommends a cost of services analysis to pinpoint IT costs before entering into any significant IT outsourc-ing relationship with third parties. This way, organizations will understand where new costs are being incurred and where costs may be increasing. In the latter case, the organization can make a judgment call as to whether there is an increase in value that is commensurate with the increase in cost.
• Dealing with the potential negative effects of expected outsourcing efficiencies that never materialize. The bullet above describes how an organization should determine its true cost of providing various IT services before entering into an IT out-sourcing relationship. Typically, costs involved in an IT outout-sourcing relationship can be controlled to maintain the status quo by fixing costs and annual increases. Fur-thermore, negotiating anticipated fees for project related work up-front and including them in the contract can help to control longer term costs. However, costs can spiral out of control if service enhancements and statements of work (SOWs) are needed to perform unanticipated upgrades and/or implement new or enhanced systems. For these, the organization should try to fix rates and rate increases, and insist on staying involved during contract negotiations with any third party vendors to avoid exorbitant markups on software licenses, etc. Unfortunately, if these measures are not taken dur-ing negotiations, the organization has limited leverage, especially in long term con-tract situations (e.g., ten or more years).
• Dealing with the potential negative effects of performance issues. The cornerstone of any IT outsourcing relationship consists of a trusting relationship backed by a well-planned and mutually beneficial agreement with a series of schedules encompassing a variety of services and SOWs that are tailored to the organization’s unique require-ments. For example, there may be a statement of work (SOW) to replace the organi-zation’s current ERP system. However, if expectations are not met, the organization must have a well-defined escalation process to remedy any issues and defaults. In addition, an exit strategy that serves to avoid expensive litigation and cause minimal disruption to the business is required.
• Avoiding erosion of accountability and transparency over time. It is imperative for organizations to continually monitor performance and actively manage any IT outsourc-ing relationship. Insist that the IT service provider delivers at least quarterly, preferably monthly, performance reports comparing actual to expected performance levels. For example, system up-time should be established at 99 percent or above. If the service provider’s performance consistently falls below goal (e.g., 3 months in a row) the con-tract should include performance credits that compensate the organization for any pro-ductivity losses and/or incremental costs due to the performance issue.
• Managing the agreement and organizational resources (in some cases). As stated earlier, the organization should actively manage their chosen service provider through the lens of the agreement and reasonableness. The reasonableness attribute is often written into the agreement in certain places to provide allowances for services that are not covered through a SOW. For example, a software as a service (SaaS) provider may provide a certain number of hours (e.g., four to eight hours) to configure reports as part of an incident versus charging extra for this service. Active management means at least monthly meetings with both technical and non-technical resources to discuss performance during the previous period along with planned enhancements, upgrades, and projects. It is also wise to develop relationships with other organizations using the same service provider to discuss their experience and any service issues. In many
cases, the service provider will actually host an annual conference or other user group meetings to benefit from any service enhancement ideas.
• Assuring that over time there is no loss of control over resources and/or technol-ogy direction. As with any initiative or project, involved parties need to routinely check in with each other to monitor progress against goals and make adjustments as needed. Internal accountability is every bit as important, if not more so, in a situation where functions are being outsourced.
• Experiencing loss of in-house expertise and distinctive competencies. When out-sourcing routine or ‘commoditized’ services such as data center management, desktop support, etc., organizations typically don’t lose much in the way of valuable institu-tional knowledge and related competencies. However, when other services such as business analysis, application development (i.e., programming), application support, etc., are outsourced, valuable intellectual knowledge can be lost. For example, when replacing custom software with a packaged solution, organizations should strongly consider retaining some programmers and analysts to fulfill application support and maintenance positions that are likely to be required. Some re-training may be necessary.
• Experiencing potential lower level of services and loss of flexibility; may be locked into older technology. Careful attention should be paid to the level of service desired during contract negotiations and how they will be maintained to acceptable levels. However, in some instances it is difficult to replicate the personal attention in-house IT staff provides. Organization staff may grow accustomed to this personal level of service, which is atypical of many relationships that are governed by service level agreements and driven by cost containment and profit. This does not mean that ser-vice providers do not deliver to expected performance levels since most do. However, there is oftentimes an inherent loss of flexibility and personal touch that cannot be avoided in an outsourcing situation.
• Understanding the scope and ramifications of the outsource agreement. Most out-sourcing arrangements are not easy to reverse in the sense that significant time and analyses have been invested to determine the viability of outsourcing. That, coupled with the cost of actually making a technology and management transfer, amounts to a substantial cost that one would not reverse on a whim or indiscriminately.
How to decide what parts to outsource
IT outsourcing options
According to the research firm Gartner, there are several strategic sourcing models. These range from internal delivery to full outsourcing and support for specific towers of service. Some models involve strategic partnerships with other local government organizations while others include “selective sourcing” of providers to achieve best results. Each of the IT strategic sourcing models has its strengths and weaknesses. Which model is ultimately chosen depends on management’s capacity to tolerate risk, vendor management capabili-ties, cost, and what the organization considers as its core competency.
The following list defines some of the outsourcing models that exist:
• Internal delivery. This model defines the current status of most organizations’ IT or process operations. It refers to organizations whose IT staff are employees (although some functions are outsourced) and focus on staff augmentation for certain projects and applications running “in the cloud.” For example, citizen relationship manage-ment (CRM) or email may be hosted in the cloud.
• Shared services. This refers to a centralized (onshore or offshore) service organiza-tion; e.g., provider of managed help desk and/or network services, delivering IT ser-vices or business processes for an organization, etc.
• Full outsourcing. A single contract with one provider for the full scope of services. • Joint venture. A separate service company built and co-owned with an external
ser-vice provider (or other client organizations in case of consortium), which is expected to provide management and expertise. For example, an authority is established to pro-vide disaster recovery and security services for several local governments.
• Best-of-breed consortium. A group of external service providers with a lead provider established for a large contract.
• Selective outsourcing. Separate outsourcing contracts for selected IT functions or business processes, using a best-of-breed tactical approach and competitive deals. • Prime contractor. Provides management and integration of multiple service providers
to derive a single or global solution or service.
All of these models have distinct advantages and disadvantages, and exist in the mar-ketplace to accommodate a variety of management needs relative to the delivery of IT services within their organization. Organization leaders need to understand which stra-tegic sourcing models are best aligned with the organization’s overall objectives. Ideally, organizations would explore each option once they have determined what services to consider.
Through an exploratory process, the organization should define what their require-ments are and discuss the various delivery models with existing local governrequire-ments, consortiums, joint ventures, and service providers. A more formal request for informa-tion (RFI) process can be used to gather informainforma-tion and attempt to make an “apples to apples” comparison. Such a process may eliminate one or more options before face-to-face meetings are held to explore options more in-depth.
Ultimately, whichever option is chosen must align with the overall objectives of the organization. For example, if an organization wants to support local businesses, they would not want to consider an IT strategic sourcing option that involves off-shoring work.
Towers of service
When defining IT functions during strategic sourcing, it is important to clearly define the services and expected service levels to establish an expectation with responding vendors as to what is required. It is common to define services organized by “towers of service” with the following information defined for each tower:
• Tower objective
• Base scope of services (in-scope and out-of-scope) • Service levels
• Key assumptions.
The following figure illustrates typical IT services organized by major area including: • IT strategy and leadership involves services that guide the IT organization in
accor-dance with the IT governance structure. This service ensures that the organization’s IT resources are optimized and IT delivers the highest possible value. It is typically the responsibility of the CIO or other IT leader.
• IT planning and project management involves services that plan for use of resources in support of the IT strategy. Typically, there are project management services
whereby a project manager is assigned to oversee projects so that they’re delivered on-time and within budget.
• SaaS/hosted applications include SaaS and hosted application services, typically pro-vided by a third party, that include bundled software, hardware, and services deliv-ered primarily over the Internet.
• Applications include services around software applications that typically include application development, application maintenance, and application support. Appli-cation development has evolved from an in-house provided service to one that is provided by software vendors through application software licensing. Maintenance services are typically provided in these instances as well. However, oftentimes, orga-nizations provide their own application maintenance and support services to the end users. These services typically involve installing/testing software updates and provid-ing end user assistance through configuration, trainprovid-ing, and troubleshootprovid-ing.
• General support services include help desk, desktop support, and database adminis-tration. These services are the most visible to the majority of end users. A customer service orientation is essential.
• Infrastructure services include data center operations, IT security, and network operations. These services are the least visible to the majority of end users; however, without these services, systems simply would not work. These services represent the back office operation of IT.
• Disaster recovery services provide the necessary redundancy in the event systems fail due to unplanned events such as power outages, floods, tornadoes, security breaches, or other incidents. Ideally, disaster recovery supports a business continuity plan which describes the processes for recovery in the wake of one of the aforementioned incidents to ensure minimal business interruption.
IT Governance
IT Strategy and LeadershipApplications General Support Infrastructure
IT Planning and Project Management
Disaster Recovery SaaS/Hosted Applications Application Development Application Maintenance Application Support Help Desk Desktop Support Database Administration Data Center Operations IT Security Network Operations
Any one of these elements could be outsourced or partially outsourced. Typically, organizations want to know which services are provided within each tower of service.
Developing a list of these services, along with current and desired service levels (e.g., what will success look like?), is a good first step in identifying which services the organization should consider for IT strategic sourcing with the caveat, of course, that it has already been identified as a solution to whatever the central “problem to be solved” is. Organizations typically get in trouble because they don’t keep the end goal in mind. Service portfolio
It is generally necessary to drill down to identify the specific services within each “tower of service.” This level of specificity facilitates development of solid service level agree-ments (SLAs), performance measures, and activity costs.
The following figure provides a sample list of services provided within typical “help desk” and “desktop support” service towers, followed by sample performance metrics. Sample Towers of Service: Help desk and desktop support service portfolios
Help Desk Desktop Support
• Problem resolution (basic and advanced) • Incident management
• Knowledge base development and maintenance • Service request processing
• Generation and analyzing customer satisfaction surveys
• Change management repository
• Asset management • Break/fix services • Software distribution • Image management
• Desktop hardware specifications and procurement
• MAC work (moves, adds, and changes) • Hardware refreshes
The following figure shows examples of service level or performance metrics that can be used to measure the effectiveness of IT services. Identifying the measure of the actual service level being provided is as important as defining the goal. The actual measures are typically recorded on a monthly basis. In the example below, the actual measures sometimes exceed goal, while in others, the actual measures fall below goal. Each service level agreement (SLA) is unique based on the organization’s needs. For example, incident response time for public safety systems would likely need to be higher than those for the human resources systems.
Sample Performance Metrics
Performance Metrics Goal Actual
Incident response time – Urgent severity 15 minutes 14 minutes
Incident response time – High severity 15 minutes 21 minutes
Time to resolve – Urgent severity 4 hours 2.25 hours
Time to resolve – High severity 12 hours 11 hours
Tickets resolved first contact 25% 50%
Annual client satisfaction score (out of 5.0) 4.5 4.7
Performance metrics are important because they establish clear, quantifiable goals with respect to IT services. Often, service level goals are established to support the over-all goals and objectives of the local governments. For example, network up-time for com-puter-aided dispatch (CAD) may be set at 99.9 percent due to the critical nature of CAD for public safety such as emergency medical service (EMS), and police and fire services.
IT outsourcing readiness
It is vitally important for the local government to understand where it sits relative to two dimensions before making an IT outsourcing decision: service definition and performance metrics.
The following illustration highlights the four major quadrants relative to IT out-sourcing readiness. The illustration shows how clarity relative to service definition and performance metrics ultimately leads to a greater chance of success with respect to IT outsourcing, while imprecision or lack of clarity presents risks.
IT Outsourcing Readiness
Risk of Outsourcing the Wrong Services
Strong Candidate for Outsourcing
Weak Candidate for Outsourcing
Risk of Overpaying for Outsourcing
Nebulous; Lacking
Specificity Service Definition CommunicatedClear and Well Detailed Metrics; Communicated Regularly P erf ormanc e Me tric s No Metrics
Once you can clearly articulate what you want and objectively evaluate the quality of the service, then your odds of a successful venture greatly increase.
Cost of service
A frequent question asked of consultants in many IT assessment engagements is how much IT services cost. Local governments need to understand the costs to establish performance benchmarks that contribute to the decision making related to outsourcing. Important cost measures include:
• An assessment of the value received from such services (versus cost).
• How costs of service provided internally compare to the costs when provided by the private sector or by other local governments.
Typically, the best way to determine cost of services is to determine how the major IT cost components are distributed among the various towers of service. In most IT depart-ments, costs typically fall into five major buckets:
1. Salaries and benefits
2. Indirect costs (e.g., software maintenance for enterprise applications)
3. Direct costs (e.g., software maintenance for specific departmental applications) 4. Overhead costs
5. Refresh (or depreciation) relative to capital purchases.
Plante Moran follows an activity-based costing model to demonstrate how IT costs are distributed among the various towers of service and how these costs compare to other local governments as well as the private sector. Local governments that have determined their costs of services for IT are then in an optimal position to determine how these costs can be allocated among departments that consume these services and what potential cost savings can be achieved if the organization were to outsource specific towers of service.
The following table provides two examples of how understanding costs of IT services can be used to determine potential savings through outsourcing. In any analysis, transi-tion costs should also be factored in along with consideratransi-tion of soft benefits and chal-lenges such as those mentioned previously.
Sample City IT Outsourcing Analysis, Net Present Value Scenarios (5 years) Service Level
Metrics* Annual CostCurrent Number of Devices Annual Cost/Device
Annual Cost to Outsource/ Device Potential Savings/Device Data Center Operations $1M 350 Servers $2,857 $1,800 $1,057 Desktop Support $2.1M 2,500 Desktop/ Laptop $840 $600 $240
Using the above example, in an organization with 1,000 devices, the potential annual savings through outsourcing data center operations would be $1,057,000.
To further illustrate, this chart shows a sample net present value (NPV) of outsourcing specific towers of service over five years.
$2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $-$(2,500,000) $(2,000,000) $(1,500,000) $(1,000,000) $(500,000) 1 2 3 4 5 6 7 Tower
NVP (without transfer of assets) – Greatest Absolute Value NVP (without transfer of assets) NVP (with transfer of assets) – Greatest Absolute Value NVP (with transfer of assets)
How to outsource IT
Steps for outsourcing IT for local governments
The process of going through an effort to outsource one or more technology functions should be deliberately laid out, as the organizational impacts and opportunities for chal-lenges along the way are significant. Consider the following steps when approaching the decision of whether IT should be outsourced.
IT outsourcing steps Step One: Establish a team
As manager or chief administrative officer of your jurisdiction, you should establish a team to study IT outsourcing. Ideally, this is a team that is already an integral part of an overall IT governance structure and process. The importance of this team is to ensure all managers who have a need for IT services are represented. Each manager’s specific needs should be balanced against the overall needs of the organization to ensure value.
Step Two: Conduct a feasibility study
The primary goals of local governments are to lower or at least maintain operational costs while improving operational efficiencies and expanding services to residents. With this in mind, start by studying the feasibility of IT outsourcing—that is, compare the competitiveness of the existing operation to an outsourced arrangement.
One of the important exercises management must perform before doing a feasibil-ity study is a cost-of-service analysis, which identifies the organization’s current cost of doing services. Plante Moran recommends a three- to six-month period to study these
costs to make sure they are as accurate as possible. An appropriate evaluative measure is to determine the NPV of outsourcing certain IT functions versus retaining the functions in-house. A positive NPV is indicative of a favorable outsourcing situation.
Once the feasibility study is complete, the organization can, along with consideration of the benefits and challenges described earlier, determine the best course of action for outsourcing.
Step Three: Create a communication plan
The local government should develop a communication plan, keeping the human resources department in the loop, to inform those who could be impacted by the change:
• Local government employees • Residents
• Local government officials • Local government vendors.
The local government organization should manage expectations for different public stakeholders as change takes place. Some possible approaches for communication include newsletters, email blasts, outsourcing vendor reports, and the like.
The importance of this plan is somewhat dependent on the scope and magnitude of outsourcing that is being considered. Some local governments decide to outsource cer-tain functions such as “help desk” or perhaps leverage staff augmentation services while other local governments conclude that outsourcing of the entire IT function is appropri-ate. In the latter case, the need for developing a communication plan directed toward all impacted stakeholders becomes even more critical. Still, it’s wise to never minimize the value of clear, consistent, and frequent communication about any change.
Step Four: Issue a request for proposal and select a vendor or vendors
The request for proposal (RFP) should clearly define the business requirements and objectives the local government hopes to accomplish through outsourcing. It should also include detailed information regarding the current IT technical and support environment so that responding vendors are afforded the ability to conduct an analysis to determine the condition of the IT infrastructure and current staff levels in place.
During the solicitation process, the organization should perform an analysis to deter-mine each vendor’s ability to meet the objectives and provide the best value. Sample questions could include:
• What is the transition process?
• What are the guaranteed incident response times?
• What experience does the vendor have with similar sized organizations? • What is the escalation process for non-performance situations?
After finalists are chosen based on the best value options, the organization must perform due diligence of the finalists to determine the best fit. This due diligence may include a series of meetings, reference calls, and site visits to fully understand the capa-bilities of each vendor. Further refinement of scope and cost may occur during due diligence and the organization may choose to solicit a “best and final offer” (BAFO) to solidify pricing based on a defined scope of service. The team should prepare a pricing analysis to understand the financial impact over the duration of the proposed contract (e.g., five to ten years).
Step Five: Negotiate contract and prepare statement of work
The contract developed between the local government and selected outsourcing ven-dor is a very critical step in ensuring that proper protections are provided to the local government during the transition, for ongoing support, and for potential turn-back of the services either internally or to a different outsourcing provider. A significant number of contract provisions will need to be identified and assessed for inclusion in the contract that is linked, as needed, to the SOW.
The SOW is a formal document that captures and defines the work activities, deliv-erables, and timeline a vendor will execute against in performance of specified work for a client. Detailed requirements and pricing are usually included in the SOW along with standard regulatory and governance terms and conditions. Areas that are typically addressed by a SOW include:
• Purpose: “Why are we doing this project?” is the question that the purpose statement needs to answer.
• Scope of work: This describes the work to be done in detail and specifies the hard-ware and softhard-ware involved, and the exact nature of the work to be done.
• Work: This describes where the work is to be performed. This also specifies the loca-tion of hardware and software and where people will meet to perform the work. • Service level: This describes the service levels or performance metrics that the
ven-dor will be held accountable to throughout the course of the contracting period. For example, performance metrics typically include incident response times, network per-formance (e.g., “up time”), customer satisfaction, etc.
• Period of performance: This specifies the allowable time for projects, such as start and finish time, number of hours that can be billed per week or month, where work is to be performed, and anything else that relates to scheduling.
• Deliverables schedule: This part lists the specific deliverables, describing what is due and when.
• Applicable standards: This describes any industry-specific standards that need to be adhered to in fulfilling the contract.
• Acceptance criteria: This specifies how the buyer or receiver of goods will determine if the product or service is acceptable, and what objective criteria will be used to state the work is acceptable.
• Special requirements: This specifies any special hardware or software; specialized workforce requirements, such as degrees or certifications for personnel; travel require-ments; and anything else not covered in the contract specifics.
• The negotiated contract defines the terms and conditions under which the outsourc-ing arrangement will function and is essential in providoutsourc-ing legal and price protections for the local government. Among the elements that need to be addressed in the con-tract are the following:
• Term of the contract including initial term and options to extend
• Services defined in the SOW as well as new services that will likely arise during the course of the contract
• Vendor and client roles and responsibilities • Service levels
• Ownership of any data that are transmitted or created • Performance reports and their frequency
• Fees and payment terms
• Limitations of liability and damages • Warranty
• Dispute resolution • Termination
• Disentanglement services Step Six: Initiate transition
A number of activities will be required to transition from an in-sourced solution to an external provider that will require dedicated time by local government staff to perform. A complete transition typically takes as little as three months to as long as twelve months to occur but is largely dependent upon the scope of what is being outsourced. It includes the following areas of transition:
• Current employees • Existing assets
• Contracts and agreements • Knowledge transfer
• Establishment of performance measures for on-going vendor performance to defined SLAs
• Planned technology-related projects • Change management controls
• Implementation of new IT tools and procedures
• Establishment of performance measures for ongoing vendor performance to defined SLAs
• Planned technology-related projects
• Change management controls (i.e., process governing changes and upgrades to the IT environment)
• Implementation of new IT tools and procedures
• Establishment of financial management processes and procedures • Final hand-over to the new outsourcing provider.
Vendors responding to an RFP should be able to clearly articulate and explain their tran-sition process to provide a seamless and smooth trantran-sition.
The following chart shows business areas and/or functions typically selected to outsource.
Common Areas/Functions to Outsource
Percentage
0 10 20 30 40 50
IT Service Desk WAN Telecom (exc. transmission) Application Development End User Computing File/Print Services Application Support Data Center — Mainframe Services Data Center — Application Servers Email/Messaging LAN 50% 50% 50% 50% 50% 50% 50% 50% 50% 50% 50%
Conclusions
Based upon our experience helping local government organizations procure an IT sourcing provider, Plante Moran identified a few key tenets to keep in mind during the process:
• Take the time to gain knowledge of the vendor marketplace and what types of ser-vices they offer.
• Define the specific goals and objectives that you are trying to achieve through an out-sourcing arrangement.
• Understand the politics associated with your decision to outsource.
• Involve human resources early in the process to address staff fears about the project. • Establish a selection committee made up of key leadership and IT stakeholders. • Ensure that the services you are requesting are clearly documented.
• Negotiate a strong contract that includes conditions for transferring IT services back in-house or to another provider.
• Make sure the final contract contains a clear and comprehensive statement of work as well as transparency regarding what services you’re paying for.
• Establish a very strong governance structure during transition.
Outsourcing has become a viable option for local governments looking to retain a specific level of IT services despite increasing financial pressures. Care should be given when embarking on an outsourcing project with many factors playing into the decision to out-source and the execution of an outsourcing transaction. If managed well, the benefits of outsourcing a portion or all of an IT function can be significant.
Appendix: Sample Table of Contents for IT Outsourcing RFP
1. Introduction ... 14
1.1 Intent ...14
1.2 Deadline for Proposals ...14
1.3 Requirements for Signing Proposal ...14
1.4 Preparation of Proposals ... 15
1.5 Proposal Format Bidder Response Forms ... 15
1.6 Consideration of Proposals ... 15
1.7 Basis for Award ... 15
1.8 Award of Contract ... 15
1.9 Vendor Evaluation Process ...16
1.10 Intent to Propose ... 17
1.11 Pre-Bid Meeting ... 17
1.12 Statement of No Proposal ...18
1.13 RFP Clarifications ...19
1.14 Advice of Omission or Misstatement ...19
1.15 Bonding Requirements ...19
1.16 Individual Sections ...20
1.17 Confidential Information ...20
1.18 Non-Disclosure of Proprietary Information ...20
1.19 Tax Exempt State ...20
1.20 Reserved Rights ... 21
1.21 Advertising ... 21
1.22 Trademarks ... 21
1.23 Right to Request Additional Information ... 21
1.24 Right of Refusal ... 21
1.25 Proposal Preparation Costs ... 21
1.26 Pricing Eligibility Period ... 21
1.27 Additional Charges ... 22
1.28 Purchase Quantities ... 22
1.29 Rights to Pertinent Materials ... 22
1.30 Insurance Requirements ... 22
1.31 Extension of Pricing ... 22
2. Background Information ... 23
2.1 Executive Overview ... 23
2.2 City IT Background... 23
2.3 Current IT Staffing and Support Environment ...24
2.3.1 [VENDOR] Support ... 25
2.3.2 Intergovernmental Agreements ...27
2.3.3 Departmental IT Support ... 28
2.3.4 Geographic Information Systems (GIS) Support ... 29
2.3.5 Other External IT Support ... 29
2.3.6 IT Governance Committees ...30
2.4 Current Technology Environment ... 31
2.4.1 Hardware Environment ... 31
2.4.1.1 Seat Refresh Model Evolvement ... 31
2.4.1.2 Desktop Hardware and Software Standards ... 32
2.4.2 Software Environment ... 34
2.4.2.1 Business Application Software Environment ... 34
2.4.2.2 Other Software Environment ... 35
2.4.2.3 Specific Software Systems Support...37
2.4.2.4 Credit Card Processing Environment ... 38
2.4.3 Storage Environment ... 38
2.4.4 Networking Environment ... 39
2.4.4.1 Background Information ... 39
2.4.4.2 Current W-WAN Equipment and Configuration ... 39
2.4.4.3 Other Wireless Communications ... 41
2.4.4.4 Networking Standards ... 41
2.4.5 Telecommunications Environment ... 41
2.4.6 Radio Services Environment ... 42
2.4.7 Alarm and Audio Visual (AV) Environment ... 42
2.4.8 Printers, Copiers and Fax Machines ... 42
2.4.9 Other Technologies and Systems ... 42
2.4.10 IT Projects ... 43
2.4.10.1 Technology Request Process ... 43
2.4.10.2 Strategic Technology Plan – Initiative Roadmap ... 43
2.4.10.3 Current and Planned Technology Initiatives ...44
2.4.10.4 Demand Management ...44
2.4.11 IT Policies and Procedures ...44
3. Scope of Work ... 45
3.1 Service Request Management ...45
3.1.1 Service Priorities ...45
3.1.2 Performance Tracking and Reporting ...45
3.1.3 Penalties ...46
3.1.4 After Hours Support ...46
3.1.5 Problem Escalation Procedures...46
3.1.6 Service Level Changes ...46
3.2 Scope of Services...46
3.2.1 Tower #1 - Technology Administration ...48
3.2.1.1 Sub Tower - Overall Administration ...48
3.2.1.2 Sub Tower - Technology Advancement ... 52
3.2.1.3 Sub Tower - Budgeting ...54
3.2.1.4 Sub Tower - Documentation ...56
3.2.1.5 Sub Tower - Reporting ...58
3.2.1.6 Sub Tower - Systems Management ... 61
3.2.1.7 Sub Tower - Security Procedures ... 63
3.2.1.8 Sub Tower - System Recovery ...65
3.2.2 Tower #2 - Data Center Services ... 67
3.2.2.1 Sub Tower - Data Center Management Services ... 67
3.2.2.2 Sub Tower - Server Management Services ... 70
3.2.2.3 Sub Tower - Storage Management Services...72
3.2.3 Tower #3 - Audio/Visual Production and System Services ...74
3.2.4 Tower #4 - Application Software Services ...75
3.2.4.1 Sub Tower - General Applications Support Services ...75
3.2.4.2 Sub Tower - External Web Site Management Services ... 78
3.2.6 Tower #6 - Help Desk Services ...81
3.2.7 Tower #7 - Radio Services ...84
3.2.7.1 Sub Tower - 800 MHz and Remote Entity Radio System Services ...84
3.2.7.2 Sub Tower - Wide Area Network (WAN) Services ... 87
3.2.7.3 Sub Tower - Other Radio Services Support ...90
3.2.8 Tower #8 - Network Management Services ... 92
3.2.8.1 Sub Tower - Network Services ... 92
3.2.8.2 Sub Tower - Network Security ...96
3.2.8.3 Sub Tower - Alarm and Security System Services ... 97
3.2.8.4 Sub Tower - Telecommunications Services ... 100
3.2.9 Tower #9 - Field Services ...103
3.2.9.1 Sub Tower - Networked Fax, Copy and Print Services ...103
3.2.9.2 Sub Tower - Workstation Support Services ...105
3.2.9.3 Sub Tower - Specialized Hardware and Equipment Services ...108
3.2.10 Scope of Services Compliance Checklist ...111
3.3 Services Compliance Exceptions ...113
4. Master Service Agreement ...114
4.1 ARTICLE I - AGREEMENT STRUCTURE AND DEFINITIONS ...115
4.1.1 Definitions ...115
4.1.2 Captions, References and Construction ...115
4.1.3 Order of Precedence ...115
4.1.4 Incorporation by Reference ...116
4.1.5 Neither Party Considered Drafter ...116
4.1.6 Approvals and Cooperation ...116
4.1.7 Identification of Parties to the Agreement Clause ...116
4.1.8 Entire Agreement ...116
4.1.9 Agreement Extension and Modification Clause ...116
4.1.10 Applicable and Governing Law Clause...117
4.2 ARTICLE II – TERM ...118
4.2.1 Initial Term ...118
4.2.2 Options to Extend ...118
4.2.3 Fees During Extended Terms ...118
4.3 ARTICLE III - SERVICES ...119
4.3.1 Services ...119
4.3.2 Service Towers/Statements of Work ...119
4.3.3 Transition Services ...119 4.3.4 Non-Recurring Initiatives ... 124 4.3.5 Multi-Vendor Environment ...126 4.3.6 Change Management ...126 4.3.7 Non-Exclusive Relationship ...128 4.3.8 Suspension of Work ...128
4.4 Article IV - New Services ...129
4.4.1 Work Order Proposal for New Services ...129
4.4.2 Approval of Work Orders ...129
4.4.3 Competing Bids ...130
4.4.4 No Refusal to Provide New Services ...130
4.5 ARTICLE V - VENDOR RESPONSIBILITIES ...131
4.5.1 Equipment ...131
4.5.3 Documentation ...132
4.5.4 Licenses and Permits ...133
4.5.5 Knowledge Transfer and Best Practices ...133
4.5.6 Technology and Process Evolution ...133
4.5.7 Services Compatibility ...135
4.5.8 Reports ...136
4.5.9 Data Protection and Privacy ...136
4.5.10 Strategic / Business Planning and Process Implementation ...136
4.5.11 Consents ...137
4.5.12 Acceptance Testing ...137
4.5.13 Business Continuity and Disaster Recovery Plan...139
4.5.14 Disaster Avoidance ...140
4.7 ARTICLE VII - SERVICE LEVELS ...144
4.7.1 Service Levels ...144
4.7.2 Root-Cause Analysis and Resolution...144
4.7.3 Service Level Credits and Service Level Credit Offset ...145
4.7.4 Continuous Improvement ...145
4.7.5 Notice of Adverse Impact ...145
4.8 ARTICLE VIII - SERVICE LOCATIONS ...146
4.8.1 Service Locations ...146
4.8.2 Safety and Security Procedures ...146
4.8.5 Furniture, Fixtures and Equipment ...148
4.8.7 Vendor’s Responsibilities Regarding Facilities ...149
4.8.8 Physical Security ...149
4.8.9 Employee Services ...149
4.8.10 Use of Vendor Service Locations ...150
4.8.11 Shared Environment...150
4.9 ARTICLE IX - [CLIENT] RESPONSIBILITIES ...151
4.9.1 Obligations ...151
4.9.2 Strategic Control ...151
4.9.3 Exceptions to Vendor Obligations...151
4.10 ARTICLE X - VENDOR PERSONNEL ...152
4.10.1 Vendor Key Employees ...152
4.10.2 Removal and Replacement of Vendor Personnel ...153
4.10.3 Minimum Proficiency Levels and Training for Vendor Personnel ...154
4.10.4 Supervision and Conduct of Vendor Personnel ...154
4.10.5 Compliance with [CLIENT] Rules ...154
4.10.6 Vendor Personnel Are Not [CLIENT] Employees ...155
4.10.7 Other [CLIENT] Requirement Regarding Vendor Personnel ...155
4.10.8 [CLIENT] Employees ...156
4.10.9 Equal Employment ...156
4.11 ARTICLE XI - MANAGEMENT AND CONTROL ...158
4.11.1 [CLIENT] Information Technology Director ...158
4.11.2 [CLIENT] Personnel ...158
4.12 ARTICLE XII - DATA ...159
4.12.1 Provision of Data ...159
4.12.2 Ownership, Use and Return of [CLIENT] Data ...159
4.12.3 Safeguarding [CLIENT] Data ...160
4.12.4 Electronic Incident Reporting ...161
4.12.6 [CLIENT] Personal Data ...162
4.13 ARTICLE XIII - SOFTWARE, DOCUMENTATION AND INTELLECTUAL PROPERTY ...164
4.13.1 [CLIENT] Licenses to Vendor ...164
4.13.2 [CLIENT] Owned Intellectual Capital ...164
4.13.3 Vendor Software ...166
4.13.4 Vendor Documentation ...167
4.13.5 Vendor Proprietary Intellectual Property...167
4.13.6 Vendor Reference Intellectual Property ...168
4.13.7 License Restriction ...168
4.13.8 Works Made For Hire ...168
4.13.9 Authority to License and Non-Infringement...169
4.13.10 Non-Interference with Use ...169
4.13.11 Vendor’s Proprietary Rights Indemnity ...169
4.13.12 [CLIENT]’ Proprietary Rights Indemnity ...171
4.13.13 Conditions to Indemnity Obligations ...171
4.14 ARTICLE XIV - FEES AND PAYMENT TERMS ...172
4.14.1 General ...172
4.14.2 Adjustments to Fees for Terminated Services ...173
4.14.3 Non-Recurring Initiative Pricing ... 174
4.14.4 Bonding ... 174
4.14.5 Extraordinary Events ... 174
4.14.6 Payment Does Not Imply Approval ...175
4.14.7 Withhold Remedy ...175
4.14.8 Benchmarking ...175
4.14.9 Gain Sharing Opportunities ... 176
4.14.10 Revenue Sharing ...177
4.14.11 Availability of Funds ...177
4.14.12 Fee Increases ...177
4.15 ARTICLE XV - INVOICES AND PAYMENTS...178
4.15.1 General ...178
4.15.2 Invoice Summary...178
4.15.3 Billing Adjustments ...179
4.15.4 Billing Disputes and Reports ...179
4.16 ARTICLE XVI - LIMITATIONS OF LIABILITY AND DAMAGES ...180
4.16.1 Cap On [CLIENT] Liability for Direct Damages ...180
4.16.2 Exclusions from Limitations on Liability ...180
4.16.3 Acknowledged Direct Damages ...180
4.17 ARTICLE XVII - REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE PARTIES ...180
4.17.1 Legal and Corporate Authority of Vendor ...181
4.17.2 Representations and Warranties of [CLIENT] ...181
4.17.3 Performance Warranty ...181
4.17.4 Financial Condition and Accuracy of Financial Information ...181
4.17.5 Embedded and Remarketed Software ...182
4.17.6 Litigation Warranty ...182
4.17.7 Licensed Software...182
4.17.8 Licensed Users ...183
4.17.9 [CLIENT] Custom Software...183
4.17.10 Equipment and Software Maintenance ...183
4.17.11 Support Not to be Withheld ...183
4.17.13 Viruses ...184
4.17.14 Disabling Devices ...184
4.17.15 Insurance Premiums ...184
4.17.16 Compliance with Laws ...184
4.17.17 OSHA ...185
4.17.18 Drug-Free Workplace ...185
4.17.19 Changes in Law and Regulations ...186
4.17.20 Conflict of Interests...186
4.17.21 Technical Architecture and Product Standards ...187
4.17.22 Information Furnished to [CLIENT] ...187
4.17.23 Protection of [CLIENT] Property ...187
4.17.24 Prior Contracts with [CLIENT] ...187
4.17.25 Completeness of Due Diligence Activities ...187
4.17.26 Representations and Warranties Throughout Agreement ...188
4.17.27 Warranty Disclaimer ...188
4.18 ARTICLE XVIII - INTERNAL DISPUTE RESOLUTION ...189
4.18.1 Intent ...189
4.18.2 Non-Performance Escalation Procedures ...189
4.18.3 Informal and Formal Resolution ...189
4.18.4 Applicability to Disputes With Vendors Other than Vendor ...189
4.18.5 Continuity During Dispute ...189
4.19 ARTICLE XIX - TERMINATION ...190
4.19.1 Termination For Convenience ...190
4.19.2 Termination for Lack of Appropriated Funds ...190
4.19.3 Survival ...190
4.19.4 Payment of Fees ...191
4.19.5 Cumulative Remedies ...191
4.20 ARTICLE XX - DISENTANGLEMENT SERVICES ...192
4.20.1 General Obligations ...192
4.20.2 Disentanglement Process and Performance ...192
4.20.3 Disentanglement Services Plan ...193
4.20.4 Performance of Services ...193
4.20.5 Cooperation ...194
4.20.6 Period for Performance of Disentanglement Services ...194
4.20.7 Specific Disentanglement Services Obligations ...195
4.21 ARTICLE XXI - INSURANCE AND INDEMNITY ...198
4.21.1 Required Insurance Coverage ...198
4.21.2 Certificates of Insurance ...199
4.21.3 Subcontractors to be Insured ...199
4.21.4 Cancellation or Lapse of Insurance ...199
4.21.5 Other Insurance Requirements ...199
4.21.6 General Indemnity ...199
4.21.7 Damage to [CLIENT] Facilities, Buildings or Grounds ...200
4.21.8 Indemnities Throughout Agreement ...200
4.22 ARTICLE XXII - CONFIDENTIALITY ...201
4.22.1 Definition of Proprietary and Confidential Information ...201
4.22.2 Exclusions ...201
4.22.3 Non-disclosure and Non-Use ...201
4.22.4 Compelled Disclosures ...202
4.22.6 Nonexclusive Equitable Remedy ...203
4.23 ARTICLE XXIII - AUDIT, INSPECTION AND EXAMINATION OF RECORDS ...204
4.23.1 General ...204
4.23.2 Contract Records ...204
4.23.3 Recordkeeping ...204
4.23.4 [CLIENT] Audit Rights ...204
4.23.5 Third Party Audits of [CLIENT] ...206
4.23.6 Vendor Internal Audit ...206
4.23.7 Vendor Response...207
4.23.8 Vendor Response to External Audits ...207
4.23.9 Self Audits ...207
4.24 ARTICLE XXIV - FORCE MAJEURE ...208
4.24.1 General ...208
4.24.2 Duration and Notification ...208
4.24.3 Substitute Services; Termination ...208
4.24.4 Disaster Recovery and Business Continuity ...208
4.24.5 Payment Obligation ...209
4.24.6 Allocation of Resources ...209
4.25 ARTICLE XXV - SUBCONTRACTORS ...210
4.25.1 Approval Required ...210
4.25.2 Request for Approval ...210
4.25.3 Subcontractor Agreements ...210
4.25.4 Direct Agreements ...211
4.25.5 Vendor Obligations Remain Unchanged ...211
4.25.6 Revocation of Subcontractor Approval ...211
4.26 ARTICLE XXVI - MISCELLANEOUS ...212
4.26.1 Assignment ...212
4.26.2 Separation ...212
4.26.3 Amendment of Agreement ...212
4.26.4 Waivers ...212
4.26.5 Independent Contractor...213
4.26.6 Bankruptcy and Liquidation ...213
4.26.7 Choice of Law ...214
4.26.9 Venue and Jurisdiction ...215
4.26.10 Effect of Regulation ...215
4.26.11 Terminology ...215
4.26.12 Section Headings ...215
4.26.13 Counterparts ...216
4.26.14 Appointment of Agent For Service of Process...216
4.26.15 Notices ...216
4.26.16 Severability ...217
4.26.17 Non-Collusion ...217
4.26.18 Electronic Transfer of Vendor Software ...217
4.26.19 Liens ...217
4.26.20 Demonstrations and Promotions ...217
4.26.21 Legal Construction ...218
4.26.22 Binding Effect ...218
4.26.23 Freedom of Information Act ...218
4.26.24 Misspellings ...218
4.26.26 City Referrals and as a Reference Site ...218
4.26.27 Advertisement...219
4.27 ARTICLE XXVII - Closure ...220
4.28 Minimal Contract Terms & Conditions Compliance Checklist ...221
5. Vendor Proposal Response... 238
5.1 Overview ...238
5.2 Executive Summary (Section 1) ...239
5.3 Company Background (Section 2) ...239
5.4 Proposed Solution (Section 3) ...240
5.4.1 Minimal Criteria Acceptance ...240
5.4.2 General Narrative Approach ... 241
5.4.3 Transition Plan ... 241
5.4.4 Common Tower Information ... 241
5.4.5 Specific Tower Information ... 242
5.4.6 Networked Fax, Copier and Print Services Tower Information ... 242
5.5 Staffing Plan (Section 4) ... 243
5.6 Client References (Section 5) ... 245
5.7 Exceptions and Deviations (Section 6) ...246
5.8 Other Required Forms and Attachments (Section 7) ...246
5.9 Cost Proposal (Section 8) ...246
5.10 Subcontractors & References ...254
5.10.1 Subcontractors ...254
5.10.2 References...255
5.11 Payment Bond ...258
5.12 Maintenance Bond ...260
5.13 Conflict of Interest Questionnaire ...263
5.14 Insurance Requirement Affidavit ...266
Volume 44/Number 1, Item number E-43740
Recent Reports
No. 5, 2011 Measuring Community Engagement (E-43675)
No. 4, 2011 How Civic Engagement Transforms Community Relationships (E-43674)
No. 3, 2011 Positive Problem Solving: How Appreciative Inquiry Works (E-43673) No. 2, 2011 The Ugly Truth About Tax Abatements – and Strategies to Benefit
from Them (E-43672)
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Publishing and Information Resources Ann I. Mahoney, Director
Janelle Julien, Copy Editor
Erik Sundvall, Creative Director
Erika Abrams, Graphic Designer
Authors’ Contact Information Plante Moran 27400 Northwestern Highway P.O. Box 307 Southfield, MI 48037-0307 248.352.2500 www.plantemoran.com Dennis Bagley Consulting Manager Plante Moran 27400 Northwestern Highway P.O. Box 307 Southfield, MI 48037-0307 248.223.3348 dennis.bagley@plantemoran.com ICMA’s InFocus (ISSN: 0047-5262) is published by ICMA, 777 North Capitol St., NE, Suite 500, Washington, DC, 20002-4201. Copyright © 2012 by the International City/ County Management Association. No part of this report may be reproduced without permission of the copyright owner. The opinions expressed in this report are those of the author and do not necessarily reflect the views of ICMA.
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