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Minneapolis Public Schools Case Study
Greg Mead, Director of Public Purchasing
The Challenge
The Office of Purchasing in the Minneapolis Public
Schools (MPS) handles all purchasing for this large urban
school district. The six person purchasing department manages
a $650 million dollar budget and supports 100 schools sites
representing over 49,000 students.
Like many school districts, Minneapolis' Office
of Purchasing recognized that its current informal bid process
and purchasing system had become increasingly inefficient
and costly. It is the district's policy to get multiple quotes
on items less than $25,000, even low dollar items, and MPS
was looking for a way to improve their informal bid process.
Minneapolis Public Schools also wanted to find
a solution that would enable them to leverage their existing
ESD/APECS financial system, which they had been using for
more than 13 years.
Minneapolis Public Schools conducted a thorough
search for a comprehensive eProcurement solution that would
meet their criteria. Epylon provided the most cost-effective
pricing model and was very explicit about all of the initial
costs. In addition, Epylon had examples of other public agencies
that had successfully integrated Epylon to a financial system
and were using Epylon for informal bidding and purchasing.
The Solution
Minneapolis Public Schools began using Epylon eProcurement
and experienced significant efficiencies right from the start.
Epylon's eQuote and financial system integration features
simplified the purchasing process and provided time and cost
savings, while the vendor recruitment and training services
ensured a smooth transition to eProcurement.
eQuote
Minneapolis Public Schools began using Epylon eQuote
in place of its antiquated informal bid process, which reduced
the number of steps in the quoting process and saved the Office
of Purchasing significant time. MPS's old paper-based process
required 37 steps from requisition through approvals to purchase
order and took a minimum of two weeks. Using Epylon eQuote,
MPS was able to accomplish the same tasks in 15 steps and
a minimum of a few hours to three days.
Additionally, according to Minneapolis Public
Schools' research, the average cost of labor and materials
used in their previous informal bid process was $354 per purchase
order, and with Epylon eQuote, the labor and materials cost
of each purchase has been reduced to $219. On average, MPS
does 1,034 informal bids each year, and using Epylon eQuote,
the district has trimmed the cost of the process by $135 per
transaction which equates to $139,590 per year.
eQuote enables school districts to easily and
electronically send requests for quotations to vendors in
the Epylon Supplier Marketplace, an aggregated network of
more than 10,000 local and national vendors.
Vendor Recruitment
As with all of Epylon's customers, it was important to MPS
to recruit their key vendors into the Epylon Supplier Marketplace.
Engaging, motivating and enabling vendors to participate in
an eProcurement initiative is crucial for its success. As
part of the eProcurement rollout, Epylon and MPS conducted
a successful vendor fair, where local and national vendors
were invited to come learn more about how to register for
the Epylon Marketplace and how to conduct eCommerce with Minneapolis
Public Schools. Nearly 150 companies attended the vendor fair,
and as a result, nearly 120 local Minnesota vendors and most
of MPS' national vendors are part of the Epylon Supplier Marketplace.
Financial System Integration
For Minneapolis Public Schools, integration into their existing
financial system, ESD/APECS, which they have been using for
more than 13 years, is the extraordinary added value of Epylon
eProcurement.
Critical procurement tasks, such as budget checking,
pre- and final-encumbrance, and the assigning of requisition
and purchase order numbers can easily be done by Minneapolis'
purchasing department using Epylon. Financial data such as
requisition and PO numbers, purchase validations, budget and
vendor information are seamlessly exchanged between Epylon
and APECS.
Epylon's solution enables MPS' purchasing department
to use what they call a "hard fail." If a user creates
an electronic requisition, but there is no money in the budget
to support the items, Epylon kicks back the requisition to
the original user stating that there is no budget and the
requisition cannot be sent to purchasing for processing. This
hard fail feature is the check and balance that provides accountability
for the requisitioner and fulfills the responsibility of the
purchasing department.
Implementation &
Training
Epylon provided Minneapolis' purchasing department with an
account manager to offer guidance and expertise on how to
shape the rollout of the new administrative procedures and
technology to meet their needs. The account manager also provided
consulting on how to map MPS' existing offline processes to
Epylon's online solution, and trained MPS personnel on how
to use the technology. Minneapolis has used a train-the-trainer
program to educate the rest of the users on the eProcurement
system.
Next Steps
Minneapolis Public Schools is a visionary district with plans
to grow its eProcurement initiative. The next steps for MPS
include loading all of their vendor contracts into Epylon,
expanding the number of electronic requisitioners within the
district, and creating a virtual private marketplace to manage
their supply chain. As a key partner, Epylon will be there
to support Minneapolis every step of the way.
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