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Information & Communication Technology - Process Map

1. Service Demand Identification

The demand for a service could arise from a variety of reasons such as current technologies having passed their operational life or new technologies having the potential to improve efficiency.

The Demand Management guideline of the Total Asset Management Manual provides a structured process that can assist agencies in identifying genuine “needs” and in ensuring the public sector’s limited resources are applied to services that will be delivered with the best value for money.

The NSW Government’s Information Management and Technology (IM&T) Blueprint – A Well-Connected Future may assist identify need for a service that is compatible with the NSW Government’s Information Management & Technology Policy Framework. The Information Management and Technology (IM&T) Strategic Planning Guideline and Information Management Framework Guideline provide additional information on where dealing with a service demand fits within the lifecycle of an agency’s business processes.

The identification of a demand for a service should be linked to the agency’s Asset Strategy.

2. Service Delivery Options

This Stage involves exploring options to meet the defined need.

The process should include an assessment of how stakeholders are affected. This initially involves the identification of stakeholders and the development of a hierarchy of stakeholders taking into account their ability to influence the project, the extent to which the project will affect them, and the extent to which they will need to contribute.

The Value Management guideline of the Total Asset Management Manual provides a process that includes identifying alternate means of achieving a desired outcome. Treasury’s Guidelines for Economic Appraisal similarly provides guidance in identifying options.

Options should include the possibility of meeting the need through means other than procurement. The Demand Management guideline of the Total Asset Management Manual provides strategies that can be used to influence demand.

Refer to Shared Corporate Services Strategy for the benefits of sharing services with other agencies, and also to the Guidelines for Collaboration and Integrated Services, issued under Premier’s Circular PC99-31, as a further reference in promoting a whole-of-government approach across public sector agencies.

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3. Justification of Proposed Options

Government guidelines available to assist in evaluating options and selecting a preferred option are:

In addition, the Government Chief Information Office Information Management - Return on Investment for Information Security Guideline can assist prepare a quantitative approach to information security applications.

The deliverables from this stage of the procurement process will be major inputs to the development of a business case under the next stage. The planning guidance in the Premier’s Department document Strategic Management Framework - A whole of government initiative provides assistance to agencies in preparing a justification of proposed options. See also the Government Chief Information Office IM&T Strategic Planning Guideline and the Government Chief Information Office Business Case Development Guideline.

Under the Gateway Review Process a Strategic Review can be undertaken at the completion of this stage to test whether the procurement solution is the optimum means for providing the service outcomes sought.

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4. Project Definition

By this stage, the decision has been made that an acquisition solution is required to meet some or all of the service need. The project is now to be defined sufficiently for funding approval to be obtained.

If the project is a relatively simple acquisition of low risk goods or services, refer to the Simple Procurement Guidelines for more information

4.1. Appoint the project officer or team
The skills and experience of the person or team will reflect the importance of what you are buying. If necessary, draw upon other specialist expertise from within or outside your agency.  Ensure the project team has appropriate authority and approval to act and make decisions. Refer to the Resource Management section in the Government Chief Information Office Project Management Guideline

A structured Project Management Methodology must be used to manage all ICT projects and an appropriate Governance framework must be established within agencies to control decision making.

4.2. Engage stakeholders
At each stage of the procurement, identify stakeholders, including appropriate approval authorities, to recognise and overcome any obstacles early, and to ensure stakeholders support. If you do this from the beginning, it will help keep the project on time and budget. Refer to the Government Chief Information Office Information Management and Technology (IM&T) Strategic Planning Guideline and the Government Chief Information Office Information Management Framework Guideline for information in relation to stakeholder needs.

4.3. Consider the potential environmental, economic development and social benefits and impacts
Procurement should not occur in isolation of the Government’s broader environmental, social and economic development goals. The potential for benefits or adverse impacts needs to be identified at an early stage and managed throughout the procurement process. [Further information: Economic Development Guidelines, Occupational Health Safety and Rehabilitation Guidelines, Environmental Management Guidelines.] Note that price preference schemes no longer apply to large enterprises, see Treasury Circular 07-18

4.4. Establish potential service providers
Research of the marketplace needs to be done. This should include potential suppliers, relevant industry standards, an industry association that could provide useful information, existing SCCB/agency arrangements you could tap into and the experience of other agencies implementing similar ICT projects.  Refer to the Government Chief Information Office Acquisition of ICT Guideline for important supplier criteria.

4.5. Undertake a risk assessment
Before deciding to proceed with the project, a risk assessment needs to be done. This should include the consequences of the project failing on service delivery, stakeholder considerations, financial implications, and the wider business and government context. Plans to monitor and manage the risks identified should be developed and updated during the project. The Government Chief Information Office Project Risk Management Guideline, GCIO Information Security Guideline V1.1 provide the key requirements for the management of risks. Part 6 of the Government Chief Information Office Acquisition of ICT Guideline also provides guidance on the indentification of risks.

4.6. Submission for funding approval
Refer to Premier’s Circular 2003-25: Approval for Corporate Services ICT Expenditure for requirements regarding approval for ICT projects.

The Introduction to the ICT Business Case Development Guideline states “NSW Government agencies are required to develop business cases to justify capital ICT investment proposals, which demonstrate links with wider Government policy priorities, agency business needs and objectives, service delivery outcomes and Government ICT Strategic Framework.”

It further states “A full business case is required for all projects which are key components of an IM&T strategy, and for all projects whose value (irrespective of the method of funding) exceeds $500K.” The business case is to be submitted to Treasury and the Department of Commerce for assessing the alignment and consistency against the Government’s ICT Strategic Framework.

The extent of the business case should be commensurate with the risk of the project. The Government Chief Information Office Buy not Build Memorandum should be considered in the development of the business case.

Note also Treasury Circular TC 04/06 Procurement of ICT Equipment that states agencies are not to enter into leases for ICT assets but are to purchase these assets using capital funds.

The Government Chief Information Office Acquisition of ICT Guideline provides important considerations to assist in the development of a business case.

The Business Case should include the impacts on the agency due to the introduction of new ICT technology. The Government Chief Information Office Change Management Guideline is prepared to assist in this regard.

The Business Case should also identify the business benefits that are expected to be achieved by embarking on the project. These could be agency benefits or wider Government policy objectives.  A Benefits Realisation Register (BRR) is to be developed as part of the Business Case. The Register provides a structured way to document and monitor the benefits from an ICT project.  Refer to the Government Chief Information Office Benefits Realisation Register Guideline for assistance on how to prepare the Register. The elements involved in managing the achievement of benefits are covered in the Benefits Management Plan. The Benefits Management Plan Guideline includes a template for preparing the Plan.

If the estimated cost of the project is in excess of $5 million or the project is assessed as high risk using the Gateway Risk Profile Assessment Tool, a Gateway Business Case Review will need to be completed and the review report included in the submission for funding approval.

Further references

The Independent Commission Against Corruption has published guides to assist NSW Government agencies with understanding and managing probity issues. Particular references are:

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5. Procurement Strategy

5.1. Public Service Procurement
The procurement of goods and services, including ICT, by public service agencies (as defined in Schedule 1 of the Public Sector Employment and Management Act 2002) must be through the State Contracts Control Board (SCCB).

Where the SCCB has arranged a period contract, a Schedule 1 agency must use the contract for that good or service.

Where there is no SCCB period contract, Schedule 1 agencies can undertake their own purchasing within the delegations established by the SCCB. For purchases in excess of the delegations, agencies are required to submit the details of the requirement to State Procurement, for the invitation of tenders.

Non Schedule 1 agencies may access the facilities and services of the SCCB.

5.2. Selecting the Procurement Strategy
Refer to Government Chief Information Office Acquisition of ICT Guideline for acquisition approaches for ICT procurement.

5.3. Prepare a procurement plan and determine evaluation criteria
Building upon the business case prepared in Stage4, a procurement plan is a comprehensive document that outlines the proposed stages of the project and how it will be managed.

When preparing their tenders, service providers will need to address the evaluation criteria, which is the basis for evaluating tenders. The evaluation criteria, and possibly their key weightings, are to be finalised before tenders are called, and described in the tender documents. Collectively, evaluation criteria represent how value for money will be assessed and are likely to include technical merit, whole-of-life costs, foreseeable variations such as exchange rates/price increases, the tenderer’s experience, capacity, past performance and skill, and mandatory requirements such as licences, and compliance with Government and/or agency policy.

The Government Chief Information Office Acquisition of ICT Guideline is a key document in providing guidance on choosing an appropriate procurement system selection. Other documents to consider are the:

5.4. Obtain the Approval for the Procurement Plan
Approval should be sought for the Procurement Plan prior to proceeding. This will include confirming the availability of resources for managing the procurement process and the sufficiency of funding to complete the project.

Further consideration

Under the Gateway Review Process a Procurement Strategy Review can be undertaken at the completion of this stage to confirm that the optimum procurement strategy is selected to deliver the project within its budget and time constraints. The review can also assess whether the project is ready to proceed to the tender stage.

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6. Specification

6.1. Request For Tender (RFT) documents
The RFT outlines the tender and contract objectives and requirements, with details of the roles and responsibilities of all parties. It needs to be a logical, clear and precise document and include all necessary information for the tenderer to understand the proposed tender process and contract and how the evaluation panel will select the tenderer offering best value for money.

The standard key elements of an RFT are:

  • conditions of tendering – these explain the rules governing the content and submission of tenders, the conduct of the tender process and the application of any relevant Government policies to the process.
  • standard conditions of contract – these are common to many contracts
  • special conditions of contract – These are conditions of contract that are specific to the requirements for the asset being procured or allow for variations to the general conditions of contract.
  • specifications of the requirements – These provide a detail description of the technical requirements (further details in 6.2 below)
  • tender forms and schedules – These are forms which tenderers complete to provide the information required to suit the evaluation criteria, including information about the company, its products and prices.

The RFT should also clearly state whether alternative tenders will be considered and the basis upon which they are to be submitted and considered.

The Government Chief Information Office Acquisition of ICT Guideline provides advice on describing requirements, identifying acceptance procedures and documenting contractual conditions. Other references to consider when preparing tender documents are:

6.2. Preparing the specifications of the requirements
There are three main types of specifications: function, performance and technical. Whichever you chose it should be a clear description of the nature of the asset sought, and the outcomes expected by you (as the client). When preparing specifications, include enough information to allow tenderers to assess whether they have the capability and capacity to satisfy the requirement. Specifications need to be prepared in such a way as to encourage and promote competition, and not be limited to commercial or brand-specific attributes.

In addition, when preparing specifications:

  • make the distinction between specified requirements that are mandatory and those that are desirable;
  • be cautious when seeking advice from the private sector in the framing of specification requirements. Avoid bias by making sure private sector consultation and input is balanced against later interests of a potential tenderer; and
  • include other requirements such as warranty, delivery or packaging, performance standards and performance measures.

The following guidelines and memorandum have important information for the development of a specification:

6.3. Prepare a tender evaluation plan
The evaluation plan documents, and sets the rules on how tenders will be evaluated, the role, composition and functions of the evaluation team, and the governance of the evaluation process. While the level of detail will reflect the nature of the project, the plan should include information such as the evaluation objective, process timeframes, the evaluation criteria with weightings, information to be used to evaluate tenders, any procedures for clarifying or checking information with tenderers, the process for decision making, an outline of the evaluation report and recommendation to be written, and information about awarding the contract and notifying tenderers.

Refer in this regard to the NSW Government Code of Practice for Procurement, Government Chief Information Office Code of Conduct and Ethics Guideline, and Premier’s Memorandum PM98-12 regarding the use of probity auditors.

The evaluation plan should be prepared as early as possible, but at the latest before tenders close.

Appropriate approval should be obtained for the evaluation plan

6.4. Review of the RFT
Seeking unnecessary information can add to the cost to service providers preparing and submitting tenders. Prior to the release of the RFT, it should be independently reviewed to:

  • check for content and clarity; and
  • confirm it only requests the information necessary to evaluate the tenders against the evaluation criteria.

Once the RFT has been reviewed and settled, confirm the availability of funds to proceed with procurement action and obtain formal agency approval to release the RFT.

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7. Service Provider Selection

The invitation and receipt of tenders should be conducted using ethical behaviour and with probity. The process is to be transparent, with fair competition that achieves and identifies the best value for money for Government and clients. The NSW Government Code of Practice for Procurement and the Government Chief Information Office Code of Conduct and Ethics Guideline encourage the highest ethical standard in tendering practice by all participants. The Tendering Guidelines outline the procedures to be followed through the tender process. Refer also to publications of the Independent Commission Against Corruption for further information on probity in Government procurement.

The Government Chief Information Office Acquisition of ICT Guideline provides detailed information on selecting a supplier and awarding a contract.

7.1. e-Tendering
The NSW Government Electronic Procurement Implementation Strategy (Premier's Memo 2001-16) has established goals and targets for moving government procurement online, and is encouraging industry to adopt corresponding electronic procurement practices.

Key features of the strategy include:

  • an electronic tendering system and single NSW Government entry point which enables tenderers to electronically access tender documents and information and lodge tenders (see tenders.nsw.gov.au);
  • technology for the sharing and management of project information online (see asset.gov.com.au);
  • agencies reviewing and re-engineering their procurement processes and instruments; and
  • performance monitoring and reporting.

7.2. Tender Invitation
Refer to Guidelines for Government Advertising for requirements when advertising for tenders.

The tender period needs to be sufficient to encourage service providers to submit a tender and for the tender to be a competitive response. When setting the timeframe consider the value, complexity or strategic nature of the tender. As a guide, a common period is four weeks, with two weeks considered the minimum. Longer periods may be necessary where the tender involves design considerations.

7.3. Tender briefings and clarification
A briefing for potential tenderers can be held to provide them with an overview of the tender documents and what is being sought. The briefing also provides an opportunity for tenderers to clarify issues before the tender closes. If it is compulsory for tenderers to attend a briefing session, this should be clearly referred to in the invitation to tender and stated as a condition of tender.

Where tenderers seek clarification of the tender specifications, requirements or other matters, this process should be managed in such a way as to not give one tenderer an unfair advantage over others. This can be achieved by providing any clarifying information to all tenderers.

7.4. Receipting tenders
The procedures for the receipt, opening and registration of tenders must safeguard the security and confidentiality of the tenders. Be mindful of probity issues associated with late tenders and the subsequent risk to the integrity of the evaluation process. Late tenders should not be considered, except where the client is satisfied that the integrity and competitiveness of the tendering process has not been compromised. Tests of integrity and competitiveness might include:

  • Was the late tender received prior to the completion of the tender opening and recording process?
  • Was it clear that the cause of the lateness was beyond the tenderer’s control?
  • Is the late tender significantly different so that no information from other tenderers could have assisted in framing the late tender?
  • Is the late tender the only conforming tender received?

7.5. Evaluating the tenders
As noted in Stage 6, clear tender evaluation procedures must be established prior to the close of tenders. Tender evaluation criteria are used to help identify the best value for money tender and are linked to the information required from the tenderers in the tender documents.

The evaluation is to involve a fair comparison of tenders, using the same evaluation method and criteria for each tender. The process is to be conducted by personnel with sufficient skills and knowledge in matters appropriate to the nature, value and importance of the procurement. Any conflict of interest with evaluators must be declared and resolved.

For complex procurement with a high value, or high risk, an evaluation team should be established. Team members will contribute a mix of skills to the evaluation process, appropriate to the various aspects of the tender being evaluated.

Refer to Premiers Memorandum 98-12 concerning the use of probity auditors by Government agencies.

When evaluating tenders from other Government agencies, evaluating officers should refer to Treasury’s Policy Statement on the Application of Competitive Neutrality (Treasury Circular TC 02-01 refers).

Any tender that does not comply with the tender requirements may be passed over. When a tender is passed over or rejected, or a non-conforming tender is recommended, the reasons must be clearly documented by the evaluators.

Agencies must ensure the confidentiality of tenders is maintained.

If it is necessary to enter negotiations to achieve sufficient value for money, these negotiations should commence with the tenderer that submitted the most acceptable tender. Tender negotiations must not involve trading-off one tenderer’s price against other tenderers’ prices. This practice, referred to as ‘bid-shopping’, is prohibited under the NSW Government Code of Practice for Procurement.

7.6. The Evaluation and Recommendation Report
Following completion of the tender evaluation process and selection of a preferred tenderer, prepare an evaluation and recommendation report recording the reasons for the evaluation team’s recommendation and submit it to the agency’s delegated authority for approval to accept the recommended tender. Reasons for the recommendation, and for the passing over of any lower priced tenders, should be clearly documented and supported. The report should be a complete account of the evaluation and must be able to stand up to independent scrutiny.

7.7. Awarding the contract
Under the Gateway Review Process a Tender Evaluation Review can be undertaken before the contract is entered into to confirm that the recommended decision appears appropriate. The review also aims to provide agency decision makers with confidence that the process used to select the proposed service provider is robust.

The officer or committee with the appropriate delegation approves the evaluation and recommendation report to accept the successful tender(s). Approving officers must be satisfied that the best offer, as measured against the evaluation criteria, is being accepted.

When the selection is completed agencies advise the successful tenderer with formal notification of acceptance of its tender or award of contract.

Unsuccessful tenderers are to be advised as soon as possible after contract award of the decision. Upon request, a debriefing should be given to unsuccessful tenderers. The unsuccessful tender would be discussed in terms of how well it met the tender requirements and evaluation criteria. Direct comparisons should not be made with the successful tender response.

The NSW Government has introduced requirements for Disclosure of Information on Government Contracts with the Private Sector (Premier's Memorandum 2000-11). Unless otherwise authorised by the tenderer or required by legislation, information included in unsuccessful tenders is to be treated as commercial-in-confidence.

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8. Implementation

8.1. Contract Management
The client’s contract manager should be appropriately experienced and skilled, and should understand the overall scope and nature of the contract, its primary objectives, and the risks involved. Appropriate contract management systems and procedures should be established commensurate with the size, risk and complexity of the contract.

The contract manager must have the necessary authority to administer contractual matters. Effective contract management will ensure the parties meet their contractual obligations and the contract provides value for money.

As soon as possible after the award of a contract, the contract manager should convene a contract review meeting with the successful tenderer (now called the supplier), agency representatives and other stakeholders as appropriate. At this meeting, review all aspects relating to the performance of the contract to ensure all parties have a common and clear understanding of their responsibilities and obligations. This meeting is important to establish a good working relationship with the supplier, particularly if the contract is to last a few years and to identify any misunderstandings early. Hold contract review meetings during the contract at intervals appropriate to the nature of the contract, and the contracting parties.

Contract payments should be made strictly in accordance with the terms of the contract. Be aware of the client’s obligations under Treasury Circular TC01-12: Annual Reports Legislation - Reporting on Payment of Accounts.

Acceptance of the project deliverables is a formal step in ICT project management methodologies and is the basis of approving final payment to suppliers. The Acceptance Test Report as described in the Government Chief Information Office Acquisition of ICT Guideline is the required approval document.

Under the Gateway Review Process a Pre-commissioning Review can held after a deliverable has been produced but prior to its use by the agency. It would take place after all testing has been completed but prior to rollout of the solution, with the purpose of assessing the state of readiness to commission the project and to implement the change management required.

8.2. Keeping records
Actions and decisions need to be accounted for and, in particular, good record keeping of decisions is imperative for auditing and accountability purposes. Records are to be kept in accordance with Government or agency requirements. Refer to Premier’s Memorandum PM98-16: Records Management Standards and Practices.

8.3. Resolving Issues
Any misunderstandings or disagreements should be resolved as quickly as possible. Good contract management and regular clear communication between the parties should solve problems as they arise throughout the term of the contract and minimise the prospect of disputes. For less routine and potentially serious problems the contract should specify a mechanism for resolving issues. It is government policy that, wherever appropriate, alternative dispute resolution techniques are used rather than litigation (see Premier's Memorandum 94-25).

8.4. Service Provider Performance
The performance of the service provider should be monitored, evaluated and measured against the contract requirements. To help manage the performance of service providers Government agencies should acquire, maintain and exchange appropriate information about the performance of service providers on contract. The Service Provider Performance Management Guideline details the objectives, application and benefits of supplier performance management and exchanging information with other agencies.

The benefits of effective performance management for service providers and agencies are significant in terms of obtaining better outcomes, rewarding superior performance, encouraging continuous improvement, assisting in the future design of contracts, and ensuring the terms and spirit of the contract are adhered to, including the commitment to better service delivery.

9. Operation

During this Stage, monitoring commensurate with the value of the purchase, should be undertaken to ensure the outcomes required from the procurement are met. The agency’s Benefits Realisation Register and Benefits Management Plan prepared as part of the business case for the project provide the tools in this regard.

In cases where service contracts are used, ongoing monitoring of the service will be undertaken in a manner consistent with the procedures outlined in Stage 8 of the procurement process (Implementation).

The Government Chief Information Office Change Management Guideline provides the key requirements for the successful management of the change within the agency.

Operating costs must be controlled, risks managed and flexibility enhanced through maintenance planning. To do so successfully, an agency needs to pursue initiatives that:

  • Enhance the link between service outcomes delivered to the community and the maintenance of the assets involved in the delivery;
  • Establish clear links between maintenance objectives and asset performance;
  • Resolve uncertainty regarding the disposal of assets; and
  • Gain the commitment of operational maintenance managers and staff to Maintenance Planning.

The Asset Information guideline and Asset Maintenance Strategic Plan included within the Total Asset Management Manual offer guidance in maintenance planning. The benefits to agencies and Government are:

  • Assets perform at optimum levels, reducing service disruptions and losses due to asset failure;
  • Risks to the agency can be identified and ameliorated;
  • The costs of asset maintenance can be quantified and budgeted with confidence;
  • The performance of the asset can be reviewed to suit service delivery needs;
  • The maintenance plan provides a foundation for continuous process improvement;
  • The plan provides a feedback to improve future application of the maintenance process; and
  • Reduced environmental impact by controlling resource usage.

An agency’s practices in operating its assets should also be consistent with:

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10. Evaluation

Procurement evaluation involves collecting and using the knowledge gained throughout a project to ascertain whether customer needs and expectations have been fulfilled and to determine whether a value for money outcome has been achieved. The procurement evaluation stage should elicit ideas for improving and optimising user / stakeholder satisfaction in the delivery and outputs of projects in the future.

The Post Implementation Review guideline of the Total Asset Management Manual will assist agencies conducting a procurement evaluation.

Complete the benefits management plan based on the direction provided in the Government Chief Information Office Benefits Management Plan Guideline. Review if the benefits have been realised in terms of those expected to be realised at the start of the project or modified during the course of the project. As part of the review consider the success of change management on the organisation resulting from the introduced technology. The Government Chief Information Office Change Management Guidelines can provide assistance in the review.

The Gateway Review Process has provision for a Post Implementation Review that agencies may choose to undertake on their project.