A learning experience
Thames Valley District School Board's e-procurement
scores high marks
by Richard Bray
From chain link fences to portable classrooms, from custodians' uniforms to instructional computers, the Supply Management Department at Ontario's Thames Valley District School Board spends some $42 million each year, serving 8,000 employees and 80,000 students at more than 200 sites.
To do this they use an automated Tendering and Purchase Requisition System - a homegrown computer application written in the Oracle programming language using entirely in-house resources. And Thames Valley e-procurement has been in use, and under constant development, since 1991.
The story begins with the financial crunch of the early nineties, long before the Thames Valley District School Board was formed by the amalgamation of the Elgin County Board of Education, Middlesex County Board of Education, Oxford County Board of Education and The Board of Education for the City of London. Back then, the province of Ontario was making deep cuts in public sector spending, cuts that reduced the head count at the City of London board's purchasing department by almost one-third. With fewer resources and increasing workloads, they began searching for a way to use computers to get the work done.
Ruth Sims, a buyer with the Thames Valley board, says, "There seemed to be nothing in the marketplace that met our needs. We were using Lotus spreadsheets. It was extremely labour-intensive. We were looking for something that would handle things more electronically and that was the driver towards developing this system."
Cheryl MacKenzie, who did the bulk of the research, describes how the London board decided on the system specifications. "Where were we expending the greatest amounts of labour? Before, initially designing the system, we tried to automate the things that expended the most labour. The first thing was to get bids out to companies and, once the bids came back in, to handle the number of bids that were being returned." Clearly, the biggest savings were in automating the tender process, but they found that the various systems in the marketplace were lacking in the tendering area.
"We have on-site programmers," MacKenzie says. "We had programmers on staff at the London Board and we started working with them to find out what they could do for us and how to possibly use existing systems to interface with or integrate with." What they came up with had the advantage of being simple, practical and useful for everyone in the purchasing loop: buyers, customers, users and suppliers.
Another buyer with the Thames Valley board, Larry Porter, says, "Originally, because of the reams of paper associated with tenders, we went to a diskette format - having people load the diskette in their own computer."
Each time a potential supplier downloads a bid package or receives it in the mail, everything they need is right there, both the tender information and the programs they need to run, even if they have never used the system before. Then the supplier would return it so it could be downloaded onto the Board's system, "saving a lot of time and trouble," says Porter. A program written in Visual Basic allows the Thames Valley buyers to put bid opportunities on the Internet, or on a diskette to mail to suppliers without Web access. So far, the Internet has only brought incremental change to the system. "[It] was more a means and a tool to get material out to the system," Porter explains.
Another beneficiary of the homegrown e-procurement system was the City of London School Board's finance department. "At a lot of boards," MacKenzie points out, "the power within the organization is in finance and they can often be the driving force behind the choice of software for the various boards - because, of course, they control the dollars." Working with the programmers, the buyers were able to design the automated system to meet the finance department's need to operate an "encumbrance-based" accounting system, under which money for purchases is immediately removed from the appropriate budget.
On the customer side, the Thames Valley Supply Management people make sure that end users are comfortable with the system. "We operate training courses," says Ruth Sims. "We have internal training rooms and we have regular training days scheduled."
Leading up to a launch date of September 2001, the Supply Management department was busy developing a catalogue system for end users, with a Windows point-and-click interface. Available on the board's intranet, it puts a range of long-term contract commodity items online: things like office supplies, science supplies and software. The customers use company product numbers and receive negotiated prices. Once implemented, schools will load their "shopping baskets" directly from the online catalogue.
Sims says that one of the biggest challenges of implementing the e-procurement system, apart from getting programmers' time, was teaching the vendors how to do the actual bidding. "Because we were at the leading edge, we had to get them on board and doing things our way," Sims explains. "We actually have had vendors come in to do a bid. What we have seen over the 10 years is an evolution of everyone's skills."
In today's terms, the computing power necessary to prepare a bid for the Thames Valley system is minimal: a 486 PC capable of running Windows 3.1. Because the board supplies the programs the vendors need to run on diskette or via the Internet, "it is a very easy system and thus, open to a broad base of vendors and equal opportunity bidding," Sims says.
There are currently three modules in the Tendering and Purchase Requisition System: Tendering, Purchasing and Capital Projects. The Capital Projects module allows schools to plan, room by room, what will go into a classroom. Planners enter a single number and all the items in the classroom are automatically ordered from catalogue.
Larry Porter says, "It creates a budget for the school, creates all of the requirements and, because it is integrated with the purchase order, the orders are then ready to go once the budget has been approved."
Thames Valley uses ETN (Electronic Tendering Network) to meet its obligations under the trade agreements, although there have been some difficulties with large file sizes. In future, Porter says, "I think what we would like to set up a return electronic tender service so once the company has filled out their tender so they can electronically send it back to us using a secure lock-box area."
MacKenzie agrees that an online lock-box is on the enhancement list, but "it is not something we are pushing for at the present time because we would like to see web-enabling happen first on our customer side."
Sims looks forward to a totally integrated purchasing system. "However, when we survey the marketplace we haven't been able to find a totally integrated system that will give us the benefits we already have within our existing system - what's available in the marketplace would be a step backwards."
The biggest obstacle to implementing a dream system, she says, is getting the financial side in order. "We are able to do a lot with our web-enabling even though our financial people are running a different system than we are." For reporting, she says the seamless links enabled by Internet technology allow users to look up a purchase order and associated accounting information so easily that it appears like an integrated system.
Grace Osinksi, Purchasing Supervisor for the Thames Valley District School Board Supply Management Department, says, "When the four units amalgamated into one, we quickly learned that the former London board had one of the most progressive purchase, requisition and tendering systems in the province."
The system is continually being improved, she says, with the only expense to date being the salaries of Information Technology staff. There are great benefits to dealing with programmers within the same organization. "We have a priority list and a projects list, so if we want changes in our system we don't have to wait for a new package or module to be released," Osinksi explains. "We let IT know about it. Sometimes they need time to think about it. Sometimes the response is immediate."
And the benefits of the system to the end user, Sims says, are equally apparent. "Our users often have product from some of our current online catalogues within 24 hours of their request. The turnaround times that we are able to provide and the accuracy of the information that we are pushing through to the vendors that they can get without calling are two very large benefits."
Richard Bray is an Ottawa-based freelance writer specializing in the IT sector. He has been published in magazines and newspapers in Australia, the United States and Canada and is now editor of Ottawa Computes. Before freelancing, he worked as a producer, reporter and senior writer for CBC in Toronto.