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COUNCIL ON EFFICIENT

GOVERNMENT

How to Create and Submit a Business Case

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Workshop Agenda2

Section 1 - Overview - Who and Why CEG was Created

Section 2 – Definition of Outsourcing and a Business Case

Section 3 - Business Case Thresholds and Submission Process

Section 4 - Conclusion

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SECTION 1

Overview - Who and Why CEG was Created

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New concept ?

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How the Council on Efficient Government was Created5

The Florida Efficient Government Act of 2006 created the Council on Efficient Government (CEG) in response to a growing trend to outsource government services and jobs.

CEG is responsible for evaluating business cases for feasibility, cost-effectiveness, and efficiency before an agency proceeds with any significant outsourcing of services and possible reduction of government staff.

Legislative Authority: 287.0573 F.S. and 287.0574 F.S.

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Who is the Council on Efficient Government?

The council is made up of seven members appointed by the Governor and they are:

Linda South Secretary, Department of Management Services (Chairman)

Alex Sink Florida’s Chief Financial Officer

Lisa Echeverri Executive Director, Department of Revenue

Steve Evans Chief Operating Officer, Florida TaxWatch

Akhil Agrawal President, American Medical Depot

Tim Yandell President, inetUSA

Vacancy Head of Executive Branch agency

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Office of Efficient Government Team7

The council is supported by the Office of Efficient

Government which consists of:

Henry Garrigo, Executive Director

Evelyn Gonzalez, Analyst

Noah McKinnon, Analyst

Suzanne Keele, Administrator

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CEG’s Statutory Roles and Responsibilities

Establish Processes Employ a standard process for reviewing business cases Develop standards, best-practices, and templates Assist in the creation of guidelines for assisting state

employees whose jobs are eliminated as a result of outsourcing

Reviewing of Business Cases Review and evaluate business cases to outsource Provide an advisory report on projects $10 million and

over

Promote excellence in contracting and outsourcing Incorporate lessons learned into Council standards Report on innovative methods and current outsourcing

efforts

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SECTION 2

Definition of Outsourcing and a Business Case

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Florida Statute Definition of Outsourcing

287.05721(2) F.S. defines outsourcing as:

The process of contracting with a vendor to provide a service or activity while the state agency retains responsibility and accountability for the service or activity and there is a transfer of management responsibility for the delivery of resources and the performance of those resources

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Outsourcing Exemptions

Florida Statute lists 18 exemptions from business case requirements. Examples include, but are not limited to:

Artistic Services Legal Services

DOT Construction Auditing Services

Some Health Services Training & Education

Architectural & Engineering Lectures

Other Governmental Agencies

A complete list of exemptions can be found on the outsourcing flowchart found on the CEG web site or in Florida Statutes 287.057(5)(22), 287.0571, 287.055, 337.11 and 440.491(6).

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Flowchart - Is My Project an Outsource?

IS THE ACTION FOR A COMMODITY?

YES

NOIS THE ACTION FOR A

SERVICE OR ACTIVITY?

NOT AN OUTSOURCE

NO

IS THERE A TRANSFER OF MANAGEMENT

RESPONSIBILITY FOR THE ACTIVITY TO THE

VENDOR?

YES

NO

DOES THE AGENCY RETAIN RESPONSIBILITY OR

ACCOUNTABILITY FOR THE ACTIVITY?

YES

NOYES

IS THE SERVICE OR ACTIVITY EXEMPT FROM BUSINESS CASE REQUIREMENTS

(SEE PAGE TWO)

IS MY PROJECT AN OUTSOURCE?

PLEASE PROVIDE OFFICE OF EFFICIENT GOVERNMENT WITH A BUSINESS CASE

OR JUSTIFICATION LETTER IDENTIFYING THAT THE OUTSOURCED SERVICE IS

EXEMPT

REQUIRED ACTION

SUBMIT A BUSINESS CASE TO THE OFFICE OF EFFICIENT GOVERNMENT

(REFER TO STATUTORY TIMELINE)

REQUIRED ACTION

EXEMPT FROM BUSINESS CASE REQUIREMENTS BUT

BUSINESS CASE IS RECOMMENDED BY OFFICE

OUTSOURCED ACTIVITY NEEDS A BUSINESS CASE

NOT EXEMPTEXEMPT

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What is a Business Case?

A business case defines the expectations of the project in terms of the key benefits to be achieved by contracting out or outsourcing of services.

The business case provides a detailed analysis of the financial costs, benefits, and risks of the project.

The business case should present a clear basis for the recommendation to contract out the services.

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Creating a Business Case

Although format and content of business cases may vary, your document must communicate the intent, beliefs and risks of the project. In your document: Be clear and concise Be persuasive Make it interesting Provide a clear vision of the end result/benefit Do your homework; prove that the agency is prepared and

capable of implementing the project Clearly demonstrate the need for the project Communicate why the timing is appropriate

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What Should Be Included in a Business Case?-by statute 287.0574

A detailed description of the service or activity for which the outsourcing is proposed.

A description and analysis of the agency’s current performance standards.

The goals desired to be achieved through the proposed outsourcing and the rationale for such goals.

A citation to the existing or proposed legal authority for outsourcing the service or activity.

A description of available options for achieving the goals. An analysis of the advantages and disadvantages of each

option, including, at a minimum, potential performance improvements and risks.

A description of the current market A cost-benefit analysis

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What Should Be Included in a Business Case?-by statute 287.0574

A discussion of options for or a plan to standardize, consolidate, or revise current policies and processes, if any, to reduce the customization of any proposed solution that would otherwise be required.

A description of the specific performance standards for the outsourcing

The projected timeframe for key events, from the beginning of the procurement process through the expiration of a contract.

A plan to ensure compliance with public records law. A specific and feasible contingency plan addressing contractor

nonperformance. An agency’s transition plan A plan for ensuring access by persons with disabilities in compliance

with applicable state and federal law. A description of legislative and budgetary actions.

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Greenhouse Gas Emissions

On July 13, 2007, Governor Crist signed Executive Order 07-126 which requires all business cases submitted to the CEG to incorporate and report energy consumption and greenhouse gas emission performance criteria, as applicable to the proposed project.

Describe how energy consumption and greenhouse gas emission performance criteria will be incorporated into the proposed project

Reminder: If this requirement is not applicable to your project, state so in your business case.

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Confidential, Propriety, or Trade Secret Material Confidential, Propriety, or Trade Secret Material: If a business case submitter has been advised or considers that any

portion of the documents, data or record submitted to be confidential, trade secret or otherwise not subject to disclosure pursuant to chapter 119, Florida Statutes, the Florida Constitution or other authority, the submitter must also simultaneously provide the Council on Efficient Government with a separate Redacted Copy of its response. 

This Redacted Copy shall contain the Agency’s business case name, number, and the name of the submitter on the cover, and shall be clearly titled “Redacted Copy.”  The Redacted Copy shall be provided to the Council on Efficient Government at the same time submitter submits its business case and must only exclude or obliterate those exact portions which are claimed confidential, proprietary, or trade secret.   

The submitter shall have the responsibility to protect, defend,  and assist the Council on Efficient Government with any and all public records requests or claims made against the Council on Efficient Government regarding portions of its Redacted Copy being confidential, proprietary, trade secret or otherwise not subject to disclosure.

If submitter fails to submit a Redacted Copy with its business case submission, the Council on Efficient Government may be required to produce the entire documents, data or records submitted by submitter in answer to a public records request for these records. 

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SECTION 3

Business Case Thresholds and Submission Process

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When and How to Submit A Business Case

Submission and Review ProcessRequired Submission of INITIAL Business Case

by Agency

CEG INITIAL Review Process

Required Submission of FINAL Business Case

by Agency

CEG FINAL

Review Process

Project Cost To Whom When Due Internal Review Process:

To Whom When Due Internal Review Process:

LEVEL 1Less than $1 Million (per fiscal

year)

N/A N/A N/A CEG After conclusion of negotiations and at least

30 days before

execution of contract.

Schedule XII

Checklist

LEVEL 2$1 Million to $10 Million(per fiscal

year)

CEG, Governor's

Office, Senate

President, House

Speaker

30 days before issuing

the solicitation

CEG Business Case

Review & Recommendation

Form

CEG, Governor's

Office, Senate

President, House

Speaker

After conclusion of negotiations and at least

30 days before

execution of contract.

Final business case will

be reviewed and an

advisory report may be issued, if deemed appropriate by staff.

LEVEL 3Greater than $10 Million(per fiscal

year)

CEG, Governor's

Office, Senate

President, House

Speaker

60 days before issuing

the solicitation

CEG will submit advisory report

to all parties within 30 days of receipt of

business case.

CEGBusiness Case

Review & Recommendation

Form

CEG, Governor's

Office, Senate

President, House

Speaker

After conclusion of negotiations and at least

30 days before

execution of contract.

* Outsourced as defined in Chapter 287.05721(2), F.S.

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General Instructions on How To Submit a Business Case to CEG

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a. Submit your initial business case to the Council on Efficient Government based on criteria specified on previous slide.

b. Business cases may be submitted electronically or in hardcopy format. The email address for the office is ceg@dms.myflorida.com.

c. Business cases may be prepared using the LBR Schedule XII form or may be submitted in a report format on agency letterhead.

Reminder: If using the Schedule XII Form for projects over $1 million dollars in value, more information will be required than is listed on form. See CEG document titled “Business Case Development and Submission Process” for details.

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General Instructions on How To Submit a Business Case Cont.

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d. Business cases will be reviewed by office staff using the criteria specified in “Business Case Development and Submission Process” document.

e. For business cases valued at less than $10 million dollars per fiscal year, office staff will review the business case and provide a response back within 30 calendar days. For business cases valued at greater than $10 million dollars per fiscal year the Council will meet and provide an advisory report within 30 calendar days of receipt.

f. Final business cases will be reviewed upon receipt and an advisory report may be issued if deemed appropriate by staff.

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CEG Standard Review Process

The Council on Efficient Government employs a standard process for reviewing business cases that provides for a deliberative examination of the state agency’s proposal to outsource.

Each section of the review form includes key questions that are used to determine the level of detail and completeness of the business case submission.

Each section is scored based on a point system that is directly related to the level of detail provided in the business case submission.

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Workflow for Business Cases Valued at $10 Million Dollars or Greater

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1. Agency identifies project

as an “outsourcing”

2. Agency submits INITIAL business

case to OEG

3. OEG receives and processes business case

4. OEG converts business case to

Schedule XII format (if appl.)

5. OEG begins internal review

process

7. OEG sends official response

8. Receipt of FINAL business

case

LEVEL 3Workflow for Business Cases Valued at

$10 Million Dollars or Greater

60 days prior to release of solicitation

1. Log in business case2. Assign analyst3. Send acknowledgement email to agency4. Schedule council meeting (if necessary)Note: Council has 30 days from receipt of business case to meet and issue advisory report

1. Evaluate for completeness a. is any data missing? b. is any data incomplete? c. is any data inaccurate? d. is any data invalid?

30 days prior to execution of contract

Send response to agency, Governor, Senate and House

1. Analyze business case using internal evaluation form2. Draft preliminary response letter3. Review findings with OEG Executive Director and obtain approval to proceed4. Mail council member packages, minimum 7 days prior to council meeting

As defined in Chap. 287.05721(2) F.S.(See OEG outsourcing flow chart)

6. Council meets and votes on

council recommendation

1. Council reviews business case and OEG evaluation form2. At meeting, OEG staff presents overview of project and staff recommendation3. Council discusses and votes on final recommendation

NOTE:If your project is exempt from this process, we recommend that the agency submit a letter of exemption to OEG for inclusion in

our outsourcing database. If resources and time allow, the office will review the final business case and issue a response back to

the agency about the project.

9. OEG reconciliation of

final business case

1. Compare initial business case to final2. Evaluate need for follow up report3. Issue final report, if necessary

Stage 1 – Steps 1-7

Stage 2 – Steps 8-9

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SECTION 4

Conclusion

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SECTION 4

The Council CEG is responsible for evaluating business cases for feasibility, cost-

effectiveness, and efficiency before an agency proceeds with any significant outsourcing of services and possible reduction of government staff.

Business Cases Business cases are required for any procured contractual service that

meet the definition of “outsource”, regardless of amount. A business case defines the expectations of the project in terms of the

key benefits to be achieved by contracting out or outsourcing of services.

The business case should provide a detailed analysis of the financial costs, benefits, and risks of the project.

The business case should present a clear basis for the recommendation to contract out the service.

CEG has reference documents to help agencies identify how to write and submit business cases.

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Office of Efficient Government27

Upon request, CEG staff can assist agencies during all stages of project development with:

Business Case Development Tools

Lessons Learned

Successful Outsourcing Characteristics

Third Party Review

Training of Staff

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Thank You!

How To Contact Us:Telephone: (850) 414-9200

Facsimile: (850) 414-6065

Email: ceg@dms.myflorida.com

http://dms.myflorida.com/other_programs/council_on_efficient_government