HomeMy WebLinkAboutFIN 02-22 Report to
Executive Committee
Report Number: FIN 02-22
Date: January 10, 2022
From: Stan Karwowski
Director, Finance & Treasurer
Subject: Request to Award the Contract to NTT Data Business Solutions Inc. for SAP
Application Management Services
-File: F-1000-001
Recommendation:
1.That the Proposal from NTT Data Business Solutions Inc., in the amount of $240,012.00
(HST included) be accepted for the initial term of one year;
2.That the total gross project cost of $240,012.00 (HST included) and other associated
costs and that the net of HST project cost of $216,138 .00 be funded over a one year
period be approved;
3.That Council authorize the Director, Finance & Treasure to fund the net project cost of
$216,138.00 from the 2018 Capital Budget Account (old 5203.1801.6174) or new
account number is C10600.1801.90; and,
4.That the appropriate City of Pickering officials be authorized to take the necessary
actions to give effect hereto.
Executive Summary: On September 1, 2021, in the middle of the pandemic, the City of
Pickering successfully implemented SAP (Phase One) to replace its obsolete financial system .
This new system meets the objectives of the Corporation, which is to deploy a modern cloud-
based, scalable, Enterprise Resource Planning (ERP) application, that will drive organizational
productivity and efficiency.
Phase one, from a financial system perspective, consisted of the following new modules:
accounts payable, accounts receivable, general ledger, purchasing and point of sale. Prior to
this date, the City also implemented phase one of its HR (SAP) system. The system is
operational and is performing as envisioned . Employing a new financial system in a pandemic
presented challenges to the implementation team. However, the dedication, perseverance and
professionalism of the City’s staff team overcame these challenges.
To take advantage of the new business functionality in the SAP environment, and to maintain
optimum operational system functionality, the City will require the expertise and services of
NTT DATA Business Solutions Inc. With the use of this firm, the City will be able to focus its
attention to leveraging its investment in the SAP system, enhance business functionality and
provide the ongoing effective technical support. The report recommendations are to award the
contract for an one year period.
FIN 02-22 January 10, 2022
Subject: Request to Award the Contract to NTT Data Page 2
Business Solutions Inc. for SAP Application Management Services
Financial Implications: The SAP project was originally budgeted for $5.0 million, via the
2018 Capital Budget. The $5.0 million capital budget was financed, per FIN20-18, as follows:
2018 Capital
Budget
Gross Capital Budget Cost $5,000,000
Less: Funding Sources
Financial Systems Res. $1,300,000
Rate Stabilization Res. 1,743,500
DC – Reserve Fund $1,956,500 $5,000,000
Control Total $0
Through the last DC Study (2018), the City was successful in having DC funding partially fund
the new financial system. The December 31st, 2021 projected uncommitted balance (after
implementing SAP) is estimated to be $1,365,698. The uncommitted balance can
accommodate the NTT DATA Business Solutions cost .
Discussion: SAP is a powerful and complex system with processes integrated between
various modules. The SAP system is a robust and scalable ERP that can accommodate the
City’s current and future growth. The vendor will be providing technical support and systems
enhancements for the Finance/Accounting, Procurement and HR modules. The selected
vendor also has the expertise and experience to provide strategic advice regarding future SAP
development for the City. With the original modules now stabilized, it is important to continue
the evolution of SAP functionality.
City staff contacted SAP Canada to develop a short list of firms that could undertake the level
of work and support required by the City. Three vendors were solicited to provide Proposals by
the Manager of Supply & Service: Bell Createch; Deloitte Consulting; and NTT DATA Business
Solutions Incorporated. Bell Createch and NTT DATA Business Solutions Inc. are the only two
vendors that submitted Proposals. Deloitte Consulting recused themselves from the process,
as they cited a conflict of interest, given that they are the City’s financial auditors.
NTT DATA Business Solutions Inc. was selected as the preferred vendor, as their AMS
(Application Management Services) solution provides the most flexible model for the City. In
addition, it is interesting to note that their hourly rates outlined in their proposal are more
competitive than what the previous incumbent charged. As a medium term strategy, it is staff’s
intent to ramp up its internal resources over the next several years, with the intention to reduce
its dependency on external agencies.
FIN 02-22 January 10, 2022
Subject: Request to Award the Contract to NTT Data Page 3
Business Solutions Inc. for SAP Application Management Services
Attachment:
1.NTT Data Business Solutions Inc. Draft Statement of Work for Application Management
Services
Prepared By:
Original Signed By:
Justin MacDonald
(Acting) Senior Purchasing Analyst
Approved/Endorsed By:
Original Signed By:
Stan Karwowski
Director, Finance & Treasurer
Recommended for the consideration
of Pickering City Council
Original Signed By:
Marisa Carpino, M.A.
Chief Administrative Officer