Centralized Electronic Payment Authorization System _CEPAS_

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					Centralized Electronic Payment
  and Authorization System

 PM Networking Group Presentation
         June 24, 2004
Vaughn Bennett
Senior Project Manager
 Key Discussion Objectives

What is CEPAS?
Present the needs analysis for CEPAS.
Describe the expected business and
technology value.
Discuss the Project Management
approach, architecture, challenges, and
lessons learned.

           What is CEPAS?
CEPAS, the Centralized Electronic Payment
and Authorization System, is Michigan’s
initiative to provide a single payment and
authorization system that integrates electronic
receipt of credit card transactions and
electronic funds transfers (EFT). Instead of
multiple agencies developing this component
in isolation, a single component will be
available to all agencies as part of the State’s
electronic commerce centralization initiative.

      SOM payment statistics

                 FY 2000       FY 2001       FY 2002

Credit Card
- Total items     698,022       910,892     1,064,322
- Total $     $54,194,398   $62,233,937   $77,375,651
- Fees                                     $1,513,441

- Total items    609,892       588,690        642,625
- Total $ $9,117,668,308 $9,489,441,277 $9,640,491,151

Projected increase is approximately 15% per year.
Payment solution applications
        in the state
Hypercom (swipe terminal)
Verifone (swipe terminal)
Tranz/ZON (swipe terminal)
Payment Manager
Frank Solutions
PC Charge
   Awaiting an e-commerce
Agriculture – license renewal
CVISN – trucking license permits
CIS – document requests program
Courts – traffic fines
DEQ – water testing program
Judiciary – application appeals program
Retirement – payment contributions
State – automotive registration
MSP – EMT program
Transportation – billboard permit program
Treasury/end user – SUT filing system
Needs Analysis for a Michigan
 enterprise payment solution
Enable an enterprise payment solution to serve
all State of Michigan Operating Units
Serve diverse administrative needs for the ‘right’
payment instruments: credit card, ACH debit,
electronic check, recurring payments.
Improve customer convenience to use electronic
payment options
Improve operational efficiencies for funds
collections and reconciliation
Reduce costs by standardizing financial and
technical processes
Enhance security                                7
Electronic Receipts Authorization
   Standard 1310.28…of 2001
 Provide a single standard for interaction with
 the SOM’s electronic commerce applications.
 State operating units (OU) will route
 electronic commerce service applications
 through a Centralized Electronic Payment
 Authorization System (CEPAS).
 During CEPAS development, interim solutions
 will be coordinated with DIT, Research &
 Policy, and Treasury.
 Alternative commerce solutions will be
 coordinated through DIT, Research & Policy,
 and Receipts Processing.
           Business Value
Mitigate security risks by eliminating multiple
tools run by departments.
Simplify management processes created by
different procedures for multiple agencies.
Eliminate different tools and applications
through training.
Consolidate reporting.
Facilitate reconciliation processes with one
Eliminate revising/reprogramming vendors’
and accounting procedures for processes.        9
        Technology Value
Centralize support capability.
Enhance system networking and line
Increase online support – 99.9% up time
Simplify system upgrades.
Augment secure data storage and disaster
Eliminate duplication of, and develop
reusable, programming logic.
Provide a single open architecture for
application program interfaces.            10
Project Management

        …one bite at a time.
        CEPAS Objectives

Implement a payment authorization system
that supports all major credit card, debit card,
electronic check,and ACH transactions.
The payment module will accept payment
information from a variety of input systems
(e.g., internet, IVR, remittance machines, key
entry, POS devices).
Provide for payments that could be both
single entry and recurring from both
corporate and consumer clients.

CEPAS Major Project Tasking

Build interfaces
Test and validate interfaces
Verify merchant processor and bank
Verify requirements are met
Verify administration features
Verify report formats
Verify reconciliation processes
Coordinate migration
 CEPAS Project Constraints

Not all SOM operating units will immediately
CEPAS integration may NOT directly benefit
each SOM operating unit
There are unknown costs for transitioning
legacy systems
There are unknown costs for new store fronts
Current costs for fees will remain in effect

  Critical Success Factors
Availability of resources per schedule
Design documents are reviewed and
signed-off in a timely manner
Training is satisfactorily presented so
that the state team can implement
Agency business rules are established
and agreed upon
Applications are readied for migration

       Management Process
RFP process
   Distribution and proposal response
   Q&A: Voice and written
   JEC evaluation and selection recommendation
Procurement process
   Administrative Board review and approval
Contract finalization process
   Purchasing negotiation and contract signing
Project initiation process
   Charter & high level schedule
   Milestones & Deliverables
Roles and Responsibilities
   Business (Treasury) and technology (DIT) owners
  High level schedule
       Three phases
       11 months
       Deliverables

                                                     Phase III
                              Phase II
     Phase I                                    Recurring and Future
                         One time debit ACH
One time credit card                             Dated Transactions
                         and electronic check
  transacations                                  for Debit ACH and
                                                     Credit Card

   60 days after            90 days after          90 days after
  contract award              Phase I                Phase II
           CEPAS ‘Management’
         Roles and Responsibilities
       Roles               Operating Unit                         Responsibilities
Project Sponsor(s)   Treasury                    - Approve Project Scope and timeline
                     Secretary of State          - Approve changes to project scope
                     Courts                      - Commit resources
                     CVISN Project               - Resolve escalated issues
                                                 - Communicate high-level activities
IT Managers          Information Officers        - Prioritize state business needs
                     Enerprise Agency Services   - Assist in management reviews
                     Enterprise Security         - Ensure sufficient resources
                     Various operating units     - Review and approve commitments
Senior Project       PMRC                        - Execute project scope, budget, and timeline
Manager                                          - Identify resources and skills needed
                                                 - Communication with sponsors and stakeholders
                                                 - Assignment of activities and tasks
                                                 - Track and maintain work plan
                                                 - Focus scope on business and success criteria
Deputy Project       EWD (DIT)                   - Assist PM with day-to-day activities
Manager              Operating Units             - Evaluate application and infrastructure solution
                                                 - Define requirements approach
                                                 - Define design approach and coordination
                                                 - Provide technical leadership and expertise
                                                 - Assist in task and activity tracking
             CEPAS ‘Technical’
         Roles and Responsibilities
         Roles              Operating Unit                   Responsibilities
Quality Assurance     EWD (DIT)              - Define standards of performance
Analyst               Operating Units        - Establish review process
                                             - Ensure quality plan compatability with project
Tester                EWD (DIT)              - Define test plan approach
                      Operating Units        - Assist in developing test plan and matrix
                                             - Coordinate tests and results
Operating Unit reps. / Various               - Describe agency business model
BAs / SMEs                                   - Define current and future business requirements
                                             - Define design requirements
                                             - Coordinate development of test cases/data for UAT
System Specialists    Various                - Define application integration requirements
                                             - Define network requirements
                                             - Participate in testing
                                             - Facilitate deployment

Risk assessment
   Overall timing
   SOM deliverables
   Technical migration concerns
   Status report formats
   E-room
   Frequency of reports and meetings established
   Executive Committee for review and policy decisions
Contract Administrator responsibilities
   Payment procedures
   Contract modifications
Develop Implementation plan
   Procedures for current and new applications    20
       CEPAS Risks Identification
                 Risk Identification                     Risk Impact                   Risk Mitigation

1 Deliverable documents do not meet expectations   1. Require rework          1. Establish success criteria for
                                                   2. Project delays          every document.
                                                   3. Customer frustration    2. Review Document content
                                                   4. Delay in customer       regularly.
                                                   executing plan             3. Provide customer with advanced
                                                                              copy of deliverables for review and
                                                                              4. Review content at least weekly.
2 Resource Availability                            1. Project delays          1. Identify key personnel and get
                                                   2. Adverse effect on staff commitment for their time –
                                                   morale and productivity Executive Management buy-in.
                                                   3. Poor quality of         2. Review resources plan weekly.
                                                   deliverables               3. Establish a backup staff plan
3 Delayed Decision Making                          1. Project delays          1. Review project schedule,
                                                   2. Adverse effect on staff milestones, deliverable on a weekly
                                                   morale                     basis.
                                                   3. Increased costs         2. Develop specific deliverable
                                                                              acceptance criteria.
                                                                              3. Develop a project escalation

                                          CEPAS Architecture
                                                 (Operating Unit)
   CC and
                                                Agency Applications

  Credit card

                    Point of Sale (POS)     PC Applications              IVR                  Internet

                      Credit Card          Batch Payments or                                       Payments,
                                                                                 Payments &       Cancellations,
                       Requests             Transaction Files
                                                                                Cancellations      Enrollment

                                                     Credit Card
       $                                        Authorization requests                    CEPAS                    File
                                                     Credit Card                        Centralized
                     Vital/Visa Net              Authorization results              Electronic Payment
                                                                                     and Authorization
                                                     Daily Transaction                    System
Depository Bank                                            File(s)
                        Credit Card
      Credit Card      transactions

           Fees        ABN AMRO                                                    ACH              Inquiries,
                        Merchant                                               Transactions         Updates,
                        Services                                                 Network             Credits
                                           Depository Financial
                             $              Institution (ODFI)
                                          ACH File                                      Agency
                       ACH Network
                       PM Challenges
Loss of resources
  Loss of Deputy PM

Enterprise marketing
  What is the message?

  How do we communicate?

Participation fees for migration
  Cost of fee

  Equitable fees

  Negotiation with funding sources for relief

Contract interpretations
  Business owner issues about requirements validation

Systems alignment
  Matching technology with IT goals               23
                 PM Lessons Learned
Ensure the business owner only sets the
requirements, let the technical owner set the
Review of tasking for validation should be
accomplished early in each milestone segment.
Business owner participation should be significant
from the beginning.
An ROI and implementation schedule should be
integral to an enterprise project plan.
Need a Systems Analyst to collate technology
strategy with policy and procedures.

Discussion and Questions