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BEACON HR/Payroll project goes live First wave on board; second wave coming April 1 North Carolina has started an historic upgrade of its business systems as nearly 19,000 state employees shifted from three outdated systems to the BEACON Personnel/Payroll system. All employees of the Department of Transportation, and temporary employees of other inaugural agencies began using the new system December 17. Full-time employees of the initial agencies began using BEACON on January 2. The $76 million project, which has been in the planning and development phases for five years, replaces the State's personnel system and two payroll systems that have operated for more than 25 years. These systems went into service before the invention of the personal computer, the mouse or Windows software. "Because of the efforts of hundreds of committed state employees, we are excited to go-live with our HR/Payroll system according to schedule," said State Controller Robert Powell, who chaired the steering committee that oversaw development of the new system. "The BEACON HR/Payroll System moves North Carolina into the 21st Century, not only in technology but in updating and standardizing its business processes to conform with best practices used in the private sector." After three months of fine tuning, anoth The BEST Shared Services Center, which includes a centralized help desk and processing center, averaged about 222 calls a day in the days after all of the initial agencies switched to BEACON, said Herb Henderson, the center's director. The call volume increased to 333 calls on January 9, 427 calls on January 10, and 609 calls on January 11, the first day paychecks were distributed using the new system. "We had the expectation that the calls would increase as we approached payday," Henderson said. "And they were the kind of calls we expected: needing help to gain access to the Employee Self Service system so they could see their pay stubs, help with their NCID (a security system for state IT applications), and calls from folks wanting to know how to perform specific functions in SAP (the technological backbone for the system). "It was extremely, extremely busy in the call center," he said. "But the system worked well and the tools we use worked well. I would rate it as a great success. Everybody got paid that should have been paid." Several glitches affecting small groups of employees were reported and fixed on the first payday, he said, but none that left employees unpaid. The project combines payroll functions and personnel information in a centralized system that will be operated by the Office of the State Controller. The new system replaces outdated technology that had become increasingly difficult to maintain, and provides basic payroll and personnel functions that previously had to be duplicated across state agencies. The new system also allows state employees, for the first time, to update their personal and benefits information, check previous payroll data and record their working time from most computers with an Internet connection. The HR/payroll system uses a technology framework from SAP that ties agency information together in a single network. The SAP software also allows for future business operations to be added to the central system. The General Assembly already has approved funding to add electronic recruiting, which will keep track of state job applicants; and electronic training, which will handle a number of training-related functions, to the new system. Planning has started on the next phase of the project, which will add budgeting, accounting and cash management functions. When completed, the BEACON system will provide centralized, coordinated business operations that can improve efficiency and provide timely, accurate information for decision-makers and the public. In addition to planning, designing and building this new business system, the BEACON project also involves training for over 3,000 core users in agency business offices, more than 3,100 employees who will use reports and information generated by the new system and nearly 8,000 managers who will use the system for reports to track the work of their agencies. In addition there are web-based courses to educate the 80,000-plus employees who can use the Employee Self Service. "This has been the most massive effort I have seen undertaken by state government in my 35 years as a North Carolina state employee," Powell said. "The level of cooperation by agencies and employees is unprecedented. Our partners in this project -- Information Technology Services, the Office of State Personnel, the Office of State Budget and Management, and DOT -- have been strong participants. Together we have spent countless hours developing a system that will provide the next generation of business operations for the State." The State's existing personnel and payroll systems will continue to operate until all agencies, including universities, have rolled off the system and all necessary historical data has been transferred. Full details on the BEACON program are available on the Office of the State Controller website at:http://www.beacon.nc.gov/. Controller's Message: Perspective can change meaning of 'success' As of this writing BEACON has conducted two bi-weekly payrolls and one monthly payroll successfully. For those of you reading this who may be experiencing the learning curve for BEACON, you may wonder if we both share the precise definition of "successful."
In fact, I have some rather interesting emails that I hope to share in the years ahead and maybe even ge But success at this point means that we went live on time, within budget, and every person in the initial group was paid the correct amount. If you define "success" as having no issues at all then you have never been involved with an implementation of this magnitude. Sure, we have experienced issues and we will continue to have these for many months ahead. The real measure of success is how we--both BEACON and agencies--respond to these issues. From a BEACON staff perspective, I am very pleased and proud of the new BEST Shared Services Center employees and the commitment they have made to this effort. Our statistics show that we have room for improvement and progress is being made every day. Our new Payroll Section is committed to ensuring that all employees are paid correctly and on time. And the Call Center is growing stronger each week through experience and hard work to ensure that employees get the service they deserve. It's not yet perfect, but given time it's going to be a model for state governments around the country. From the employee perspective, we realize that change means aggravation, frustration and impatience. We know that you're experiencing issues with NCID, leave accrual, some direct deposits, printing remittance advices, and just learning to operate a new system. If the issue is system related, we're working hard to remedy the issue and to make this impact to you as minimal as possible. We do commit that these hiccups will in no way jeopardize your pay, your leave or your benefits. If the issues are training related, we're circling back to see if there are ways to revisit these matters. For issues that are just learning-curve related, we ask that you give yourself a break and take time to learn. In fact, just ask someone from the digital generation--maybe your child---to help you out. It's fast, cheap and gives them a chance to say "thanks" for all you do for them. In the meantime, be patient with us and let us all get to where the use of BEACON is just a small part of our daily routine. Thank you for helping us make this work for all of our state government customers. CAFR shows 31.1 percent growth in General Fund balance North Carolina increased its positive fund balance by 31.1 percent in the fiscal year that ended June 30, 2007, according to the State's latest Comprehensive Annual Financial Report. The report released in December indicates that the State had a fund balance of $2.577 billion as of June 30, on an accrual basis, with an unreserved balance of $2.398 billion. The accrual basis of accounting is a system that recognizes the effect of transactions when they occur rather than when the related cash is paid or received. The General Fund is the chief operating fund of the State. The fund balance of the General Fund increased from $1.966 billion at June 30, 2006, (as restated) to $2.577 billion at June 30, 2007, an increase of 31.1%. The increase is explained primarily by higher than expected growth in individual income and corporate income taxes. For individual income taxes, withholding tax collections grew by 8% while collections of estimated taxes and final payments grew by 11% and 26%, respectively. The withholding growth rate is similar to that of a pre-recession economy and reflects both job and wage growth. Increases in estimated and final payments also reflect changes in non-wage income. Corporate income taxes, which are highly volatile over the business cycle, grew by 12.3% because of improved demand for products and services and because of the Department of Revenue's Settlement Initiative Program. This initiative began in February 2006 and allowed taxpayers who had participated in income-shifting or other identified tax strategies to pay 100% of the tax and interest and receive a waiver of some percentage of the penalties. For the 2006-07 fiscal year, corporate income tax collections under this initiative were over $101 million. "We returned to a positive fund balance just last year, after five years of negative balances, so it is encouraging to see the balance grow this year," said State Controller Robert L. Powell. "Our return to a positive balance was a major factor in restoring our Triple-A bond rating by the three major bond-rating agencies. The results from this year should strengthen our already excellent position with those agencies." The Comprehensive Annual Financial Report, or CAFR, is prepared each year by the Office of the State Controller and audited by the Office of the State Auditor. The report, which outlines North Carolina's financial condition, has received a "clean" opinion from auditors, indicating that it fairly represents the financial position of the State. The full CAFR is available on the Office of the State Controller website at:http://www.ncosc.net/financial/07_cafr/index.html. The CAFR represents a major investment of OSC resources each year, but it is not the only financial report issued by the office. Other reports include:
More than 350 representatives of state agencies, universities, community colleges and other organizations attended the Fiscal Officer Update Seminar organized by the Office of the State Controller in December. After initial opening remarks from State Controller Robert L. Powell, an overview of the recently enacted N.C. Accountability and Internal Control Act was provided by Gwen Canady, Deputy State Controller. The State Controller, in consultation with the State Auditor, is responsible for establishing comprehensive standards, policies, and procedures to ensure a strong and effective system of internal control within State government. Ron Necessary of the Commonwealth of Virginia followed with a presentation on agency risk management and internal control standards in his state. Joe Brazel of N.C. State University also gave a presentation on recent research related to fraudulent financial reporting and the use of nonfinancial measures to assess fraud risk. Assistant State Controller Wesley Ray provided an overview of the recently enacted N.C. Internal Audit Act. This legislation created a Council on Internal Auditing, with the State Controller serving as Chair, and requires each State agency to establish a program of internal auditing. David Reavis of OSC also gave an E-Commerce Update. Additional sessions included an economic and budget update by Barry Boardman and a discussion of the new Fiscal Research Program Evaluation Division by John Turcotte of the Fiscal Research Division of the General Assembly; an Office of State Budget and Management Update by David McCoy, State Budget Officer; and a BEACON Update by Canady. The seminar concluded with a presentation by Dr. Willow Jacobson of UNC-Chapel Hill on managing multiple generations and an optional breakout session on professional ethics and conduct by Tim Kennedy, CPA.North Carolina.
Revamped training critical element in BEACON roll-out An old Chinese proverb suggests that if you give a man a fish you feed him for a day, but if you teach a man to fish, you feed him for a lifetime. Teaching has been one of the main focus areas for the BEACON HR/Payroll project team. Prior to the January 2 Group One go-live, BEACON trainers taught more than 550 core users how to navigate and use the new human resources and payroll system. Now as members of the project's functional, technical and deployment teams work toward the April 1 go-live date for Group Two agencies, the training team has its focus set on delivering more than 52,000 hours of training to 2,583 core users through 1,136 classes. In addition to the core user curriculum, the training team has developed three online courses for the state's 80,000 end users to explain the project and how to navigate and use the Employee Self Service portal. To date, more than 11,000 end users have accessed the ESS portal. While developing and delivering training leading up to the first go-live, the training team learned a few lessons of its own. In December, a new training lead was brought in to design more efficient processes and procedures. Additionally, agency training agents were given the responsibility to make adjustments to their respective agency's employee's training schedules. The impact of these changes was felt immediately, with Group Two training schedules finalized the last week of December. Also, the core user individual training schedules were distributed on schedule in early January. Group Two core users began taking classes on January 22 and will continue through the April 1 go-live date. Currently there are 31 classes that range from two hours to two days. EAGLE Program will strengthen internal control in agencies State agencies face more dramatic demands and challenges than ever before in fulfilling their commitment to safeguard the State's assets. In North Carolina, the Office of the State Controller is responsible for establishing internal control standards and implementing a statewide internal control program. The program OSC will be implementing across state government is called EAGLE (Enhancing Accountability in Government through Leadership and Education). The purpose of this program is not only to establish adequate internal control but also to increase fiscal accountability within state government. Under the State Government Accountability and Internal Control Act approved by the General Assembly last year, OSC is required not only to establish an effective system of internal controls, but also to make sure that state agencies receive training on that system. Under the EAGLE program, each agency will be required to perform an annual assessment of internal control over financial reporting. By performing this assessment, agencies can identify risks and compensating controls that reduce the possibility of material misstatements and misappropriation of assets. The assessment also will indicate opportunities to increase efficiency and control effectiveness in business processes and operations. Additional information regarding the EAGLE program, as well as the dates for the EAGLE kickoff meeting and training sessions will be forthcoming. Assistant Controller Julie Batchelor one of first 'Certified Public CIO's
The center has offered classes for chief information officers in local government for three years, and last year began offering a version of the course for IT professionals in state government. "It gives some credence to the idea that the The classes focused on leadership concepts like strategic planning, change management and budgeting that would not ordinarily be connected with a computer science or engineering degree. "What you have to do as a CIO is learn the organization you are serving," Batchelor said. "It's not necessarily knowing how to do some specific application design or the intricacies of the technology components. It's more how can I take this IT organization and help advance what the agency is doing. The value a CIO brings is being a bridge between the technical side and the business side." Merging the technical and business sides has become a major focus at OSC in the last several months. Not only has OSC led the development of the BEACON HR/Payroll project, but it also has been upgrading its own technology to expand the flexibility of the work environment through use of agency -- issued laptops and wireless networking in a secure environment. "There has been a need and a desire to have more flexibility in where, when and how you do your work," said Danny Bell, who leads the infrastructure team under Batchelor. Previous remote access procedures would only allow employees to reach only some of their work, but technology available today allows access to all the systems that hold information needed for their work. "It is absolutely like sitting at your desk, only from home," Bell said. The use of laptops and wireless will continue to expand because of "business continuity issues as well as the whole concept of people being able to work anywhere, anytime." "But they want to do it securely," Bell said. OSC-issued laptops use whole-disc encryption, which requires a secure password to access any information. "If your laptop is stolen at the airport, or from your car, it stops the thief from being able to do anything or see anything without the password." Survey indicates widespread interest in expanding E-Commerce North Carolina agencies, universities and community colleges are interested in expanding electronic commerce, but believe they will need more resources and training to move away from paper-based transactions, according to an extensive survey conducted by an OSC-led task force. The E-Commerce Task Force conducted the survey as it develops a report for the General Assembly on how to expand the use of electronic commerce in state government. The survey drew responses from 42 General Government agencies, 13 universities and 47 community colleges. Of the agencies responding, 27 said they had good success in using e-commerce for disbursements, while 11 rated their success as fair and 4 as poor. Five universities said they had good success, while four others rated their experience as fair and 4 as poor. Among community colleges, 12 reported good success, while 14 said their experience was fair and 21 poor. Eighteen agencies rated their success as good in using e-commerce for receipts , while 15 reported fair and 7 poor. Nine universities said they had good success in e-commerce receipts, with 2 rated as fair and 2 as poor. Eighteen community colleges said their success rate in receipts was good, while 19 said fair and 11 poor. All three groups indicated the biggest obstacle to using e-commerce for collections was the lack of resources to develop an electronic payment program. The groups also agreed that charging convenience fees for electronic payments discouraged citizens from using credit or debit cards. Responses to questions about the use of paper checks indicated that state agencies pay an average cost of 43 cents per check, with individual agency costs ranging from as low as 2 cents per check to a high of more than $11 per check. Among universities, the average cost per check was $1.30, ranging from a low of 31 cents per check to a high of just over $4 per check. Community colleges paid an average of $2.11 per check, with costs reported as low as 7 cents per check and as high as $11.37. The task force will present its report to the Legislature in April. BEACON begins planning for Financials Project As the BEACON HR/Payroll Project continues to stay on time and on budget, some members of the BEACON team are shifting their focus to data gathering for the BEACON Financials Project. The purpose of the data gathering stage is to develop a comprehensive implementation approach for budgeting and financial sub-modules of the BEACON system. The implementation plan will include cost estimates, resource plans, requirements and a scope definition. Additionally this phase of the project includes identifying the scope and putting together the information to support an RFP (Request for Proposal) for a potential integrator. If approved, Phase II of the project (implementation) will commence in the later part of 2009 for a planned go-live by July 2011. Following are some of the business goals for implementing a new budgeting and financial system:
If funded, the project would replace the North Carolina Accounting System which provides control over the State's fiscal policies and procedures, financial transactions, resource balances, and subsidiary accounts and records through a central general ledger and other uniform information databases. It also would replace the Cash Management System, and the Budget Preparation and Budget Reporting systems. The BEACON Financials Project Team will look to the awarded vendor to help the State identify a vision for a new budgeting and financial system and an overall organizational operating environment. Data Integration Project developing strategic plan A new Data Integration initiative will leverage the information gained from the previous BEACON activities to support the development of a statewide framework that promotes the sharing of information while maintaining privacy and security. Data integration is the process of merging data located in different locations to provide a unified view of the information. Most state agencies now deliver services through a number of different programs that are supported by multiple, and isolated, information technology systems. As a result, information is spread across many "siloed" systems making it difficult for agencies to share information. This lack of sharing data can have a negative impact on the State's ability to provide quality service. Under the BEACON program, the Enterprise Data Warehouse initiative was the initial step in coordinating the statewide sharing of information. The primary goal of this initiative was to make information easily accessible with timely forecasting, trending and data analysis capabilities. A feasibility study substantiated the benefits of data warehousing and the creation of a statewide standard toolset that maximizes the economies of scale. Following these recommendations, the BEACON Enterprise Data Warehouse initiative supported four separate projects: three individual agency data warehouse initiatives and an Information Technology Services initiative that supported the development of an enterprise shared services platform for data warehousing, analytics and business intelligence. The goal of the BEACON Data Integration initiative will be to develop a Strategic Plan for Data Integration, as requested by the General Assembly last year. This plan will include:
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er 66,000 state employees in both large and small agencies will be brought into the system.
t a chuckle from at that time. 
Internal Control Program featured at annual CFO Conference
Assistant State Controller Julie Batchelor has become one of North Carolina state government's first Certified Public CIOs after completing the Chief Information Officers Certification Program with the UNC School of Government at the University of North Carolina at Chapel Hill.
re's a specific skill set you need to be a government CIO," said Batchelor, who serves as the agency's Chief Information Officer. "A lot of the concepts were not new to me, but it was especially interesting to participate in a curriculum that focused on the leadership skills and approaches needed to advance your agency's mission through information technology."