Massachusetts Digital Government Summit

IT Cloud Procurement Panel

Sherry Amos
Managing Director, Industry Strategy
Education and Government
Workday
Sherry.amos@workday.com
703.402.3476

Agenda

Government paths to the cloud

Who and What is Workday

Saas Evaluations What is Different
Pre-RFP Process

RFP Process
Evaluation Process
Contracting Process
Cloud Value and Technology Other Considerations

Recent Forums on Cloud Procurement

NYS IT Terms & Conditions A Workshop for Attorneys
NYS OGS Procurement Input and Saas Considerations
NYS Legislative Roundtable State Operations Sub-Committee

California Special Provisions for SaaS Contracting

GFOA Cloud Procurement Reform Panel
Center for Digital Government Public-Private Workgroup for Cloud
Procurement Best Practices
American Bar Association State and Local Government Cloud
Contracting Panel

Government Paths To Cloud

Maturity and Case Studies
Strategies

Case Study Examples

Data Center
Consolidation:
Shared Service,
Managed Service,
Outsourced Service

US Federal Government
Commonwealth of Virginia
Commonwealth of Pennsylvania

Cloud First Policies: US All agencies identify moving 3 services to the cloud
Federal Government
Barriers to accomplishment: staff skills and procurement
processes, security
Infrastructure as a
Service

Californias Cal Cloud

Texas Cloud Broker Service

Platform as a service

Google Apps, Microsoft 365, Even the CIA is moving to

cloud services

Open Government
Initiatives

Recovery.gov
City of Boston

Enterprise SaaS
Applications

Citizen Call Centers, 311,

Workday ERP, HR, Payroll, Financials Applications

PROJECTS

EXPENSES

PROJECT
BILLING

PROCUREMENT

REVENUE

ANALYTICS

INVENTORY

TECHNOLOGY
FOUNDATION

FINANCIALS

INSIGHT APPS

HUMAN
RESOURCES

STUDENT

PAYROLL

TIME
TRACKING
RECRUITING

TALENT

Cloud Definitions

Why Does The Technology Matter?

Is it enterprise-class?
Is it scalable?
Is it secure?
Is it innovative?
Is it mobile?
Does it improve our efficiency, effectiveness, and/or
service delivery in meaningful ways?

The Cloud Has it All We Manage It You Dont

Your IT Focus Can Shift to New Transforming Initiatives
What We Manage For You
Upgrades
Patches
Availability
Backup
Network
Storage
Operating system

Database
Integration
Provisioning
Security
Data center
Disaster recovery
System maintenance
Performance tuning

The significant problems

we face today cannot be
solved at the same level
of thinking we were at
when we created them.
- Albert Einstein

Consumer Expectations Employees and Citizens Want

the Same Experience

Workday Confidential

Slide Title

10
10

SaaS Evaluations What is Different

Business services not software or technology

Subscription not perpetual license

Operating expense not capital expense

Subscription term lengths and renewals are variable but usually 3-5
years in government

Configuration not customization

Multi-tenant vs hosted matters a lot
Service level agreements same for all customers no customization

Security evaluations different

Ensure alignment early between business owners, IT, security officers
and contracting

Summary Cloud Computing is Here to Stay

Engage in extended market research prior to formal procurement of

cloud services understand differences in native vs hosted vs hybrid
Invite providers in for discovery days give your constituents the
opportunity for dialogue of requirements and capabilities
Align your agency/business owners, procurement, legal, and security
team early in process achieve common understanding of how to
procure services vs software/hardware
Have a vision and strategic plan for how cloud services fit in across
both your business needs and your IT services

WORKDAY CONFIDENTIAL

Appendix

Pre-RFP Market Research

Approximately 60% of early market research is conducted online and

/or with industry analysts with no vendor engagement
Engage early vendor involvement and discussion you cannot learn
enough online or through 3rd parties this can still be done in a fair,
competitive, and controlled manner
Think about invitation to demo/preview days vendors need to
understand your requirements and strategies prior to a formal
procurement process
Join public webinars for introductions to market solutions
Join regional events held in your area
Ask both the vendor and your network for other customers that you
can speak with

RFP Development
Skinny mandatory requirements down to what are core business
functions and processes
Keep flexibility both in the breadth of solutions and the depth of
requirements you require to allow you to mix and match the best overall
solution for your organization allow flexible bidding partners, i.e., not just
the same ones over last 20 years
Scrub the use of requirements databases that contain thousands of
static requirements from many organizations many of which are never
implemented and have led to shelfware - and related costs due to
scope inflation
Include consideration for how to evaluate innovation in the future, not
just current static requirements
If your RFP is complex give vendors ample time to assemble quality
response 30 days is often too short if you have taken months to
assemble your RFP and its complex requirements

Evaluation Process
Response timeframes are they reasonable for RFP complexity
Clarification process need active discussion not just written
questions and responses interpreted through 3rd party consultants
or procurement
Demonstration process allow flexibility in the scripted demo to
allow for demonstration of fully integrated business processes not
just single checklist requirement eg: mobile, embedded analytics,
process changes, etc
References broaden reference mandatories not just 5 or 10
others just like me. Eg any government, university or NFP
customer of certain size; any customer with unions, any customer
with complex regulatory reporting, etc
Scoring include forward looking innovation and ability to deliver in
the formal scoring process

Contracting
Ts and Cs for true cloud solutions are different understand this
early in the process
Industry is moving to use of Cooperative Agreements which are
competitively bid work with procurement to identify these suitable for
your organization
Also investigate if vendor offers piggyback contract vehicles from
another governmental organization in your region
Be prepared to negotiate shared risk reputable vendors and public
companies will not accept unlimited liability provisions
Know which Ts and Cs are actually statutory requirements and
which are preferred practice
Do these things early in your procurement cycle, prior to RFP, and
certainly not at the end of selection

For More Information

Contact: Sherry Amos

Managing Director, Industry Strategy
Sherry.amos@workday.com
703.402.3476

Workday Confidential

Cloud Procurement in the

Commonwealth
November 2, 2015
Digital Government Summit

Pia Owens
Assistant General Counsel, MassIT
All views expressed in this presentation are the presenters own and
do not represent the views of the Baker-Polito administration.
The Massachusetts Office of Information Technology, known as MassIT, is the states lead agency for technology & innovation.
We serve more than 150 state agencies as well as cities, towns, & public schools across the state.

Adoption of Cloud in Private Industry

Forrester, 2015: Cloud spending will equal $106 billion in 2016,
up 21% over 2015
IDC, 2014: 70% of CIOs will use cloud-first strategy by 2016
RightScale, 2014: 94% of survey respondents starting to use
cloud, but most without mature enterprise strategy

Gorfor, https://www.flickr.com/photos/44412176@N05/4181323517/
20

Adoption of Cloud in the Commonwealth

Cloud
Enterprise
Content
Management

21

Cloud Procurement in the Commonwealth

At first: ad hoc, case-by-case basis
Now:
Guidance and legal terms
Pre-negotiated terms with large providers
Coming soon:
Enterprise policies and standards
MassIT as a cloud broker
Group purchasing of cloud services

22

Benefits of Cloud Services

Investment in equipment
and software

Maintenance and support

Quick entry and exit

Scalability

Security

Cost

23

Risks of Cloud Services

Access to data

Lock-in / Transition

Accessibility

Data privacy

Security

Cost

24

Pre-procurement Needs Assessment

What kind of data will you be storing? Any specific
requirements or laws that apply to the protection of that data?
What level of security do you need? Is this a very sensitive
application, or one where there isnt much risk if the system is
breached?
What are your uptime needs? How mission-critical is your
system?
Will you be outsourcing work formerly done by union
employees? If so, be mindful of the Pacheco law.

25

Conducting a Procurement: Procurement Vehicles

Statewide software reseller contract, ITS58, supports SaaS and
includes cloud legal terms
ITT46 (Network Services) can be used for managed services and
application hosting, but was not originally intended for cloud
services
MassIT IaaS and PaaS RFR / MassIT cloud brokering service
(expected in 2016)

26

Conducting a Procurement: RFQ and Contract

In RFQ, include:
Cloud legal terms
All requirements, including specific laws and rules for data
protection and minimum SLA and support requirements if any
Requirement for vendor to provide all applicable forms:
subscription agreement, SLA, terms of use, privacy policy, security
and data management policy, etc.
Requirement for vendor to identify significant subcontractors
In contract, attach all documents listed above, including negotiated
cloud legal terms and vendor documents (subordinated to
Commonwealth terms).

27

Cloud Lifecycle Management

Provisioning and access control centralized location for
administrative logins and passwords
Monitor metrics through vendor reporting and dashboards;
enforce SLA
Check typical usage and workloads against current offering and
pricing
Check regularly to make sure you can export your data

Talk with vendor and look at industry news; try to figure out in
advance whether this service might be discontinued
28

Thank you

Any questions?

Pia Owens, MassIT Assistant General Counsel

pia.owens@state.ma.us
617-626-4698

29

Cloud/XaaS and
Procurment Strategies

Tony Encinias
Vice President
Public Sector Strategy

State Procurement Process

DOES IT HAVE TO BE THIS HARD?

Rate of Change

Technology Changes

1960

1970

1980

1990

2000

2010

2020

TRADITIONAL PROCUREMENT PROCESS CANT KEEP UP!

Cultural Challenges

THINK OUTSIDE THE BOX

Traditional IT Infrastructure Model

stove pipe IT
infrastructure

increased deployment
time

40 percent
of expense
inefficient resource
usage
inflexibility for
scaling

high operating costs

unable to leverage
new technologies

Changing IT Landscape
cloud computing

mobility

Demands are changing the rules

care less about technology and more
about making IT work on demand
social media

Advances in technology
(infrastructure and network)

Fiscal Realities
tax revenue still
down

hardware refreshes
becoming more
infrequent

Unsustainable
Model

underutilized
resources
consuming limited
budget

high operating costs

inflexibility for
scaling

Cultural Changesthe IT side

changing core server/storage
skills to managing capacity

manage IT based on
services and SLAs

Hardest part of the

equationlong term habits
hard to break!
infrastructure is
NOT yoursYOU DONT
NEED TO OWN IT!

viewing compute
as a utility

business focused

Procurement Strategies
Change from CAPEX to
OPEX for onDemand
compute services
(XaaS/Storage)

Modify current
service contracts to
accommodate
XaaS/onDemand
model

We have always
Hardest part of the
done itterm
this
equationlong
habits
hard to break!
way.

Educate contract staff

and comptroller on XaaS
onDemand model

business focused

Leverage outside
cloud contracts i.e.
GSA, NASPO
Valuepoint, etc

Rate of Change

Technology Changes

1960

1970

1980

1990

2000

2010

2020

Is changing too fast

procurement processes must change to accommodate!
18 to 24 month procurement cycles dont work!

Questions?

Thank You
Tony Encinias
Vice President
Public Sector Strategy
703.388.6740
Tony.Encinias@vion.com