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ONTARIOBUYS: 2006-07 OntarioBuys Funding Application Guidelines

Table of Contents

Background
Project Scope
Project Goals and Benefits
Project Stages/Types and Funding
Cost Eligibility
Application Evaluation Criteria
Application Procedure
Funding Application Elements

The Ontario Ministry of Finance (MOF) announced the OntarioBuys program in 2004 and established the BPS Supply Chain Secretariat in 2005. The goal of the OntarioBuys program is to facilitate and accelerate the adoption of integrated supply chain leading practices in Ontario's broader public sector (BPS).

The BPS Supply Chain Secretariat is not a direct provider of supply chain services nor does it endorse or recommend specific products or services. The Secretariat's approach for the OntarioBuys program is to work collaboratively with BPS organizations to support their implementation of integrated supply chain leading practices, so that they in turn can better serve the citizens of Ontario. The Secretariat facilitates this approach by:

• promoting the development of integrated supply chain standards and common practices;
• providing project funding for the integration of sector and regional supply chains; and
• encouraging organizations to measure and report performance against established benchmarks to enable the sharing of supply chain success stories.

BPS SUPPLY CHAIN SECRETARIAT OntarioBuys Program
Mission
To facilitate and accelerate the widespread implementation of integrated supply chain management leading practices in Ontario's broader public sector (BPS)
Our Role
Facilitate transformation collaboration Champion leading practices Support development of standards & common practices Fund transformation projects Measure and report on performance against benchmarks

BPS institutions (and their associations) are eligible for funding under the OntarioBuys initiative. For fiscal 2006-07, the primary target sectors are hospitals, school boards, colleges and universities. Institutions in other sectors are also eligible, subject to funding availability.

For projects to be eligible for 2006-07 funding:

• Projects must be consistent with the strategic objectives of the OntarioBuys program to implement “integrated supply chain leading practices”, and
• Proposals must demonstrate benefits to the broader public sector and align with line ministry (e.g. MOHLTC, MEDU, MTCU) priorities and other sector initiatives.

Projects must contribute to the implementation of integrated supply chain¹ leading practices by a group of BPS institutions. A project will ordinarily qualify as integrated if it involves at least seven institutions with at least $500 million in cumulative operating budget.

The Secretariat will also consider projects that include the integration of other back office services² such as finance/accounting, HR/payroll and clinical support (e.g. laboratories). To be considered, the participating institutions must be in the process of integrating or have already integrated their supply chains.

All projects must be results-focused. Project proposals therefore must include quantifiable goals for the project and describe measures of success. This must include quantitative metrics and qualitative metrics. Proposals must describe how and by what means the success of the project will be determined for both types of metrics.

A project must yield demonstrable implementation benefits - Cash, Capacity and Qualitative benefits.

• “Cash” benefits reduce institution operating costs, freeing up budget for other activities.
• “Capacity” benefits free up resources (e.g. staff time, space) in ways that can be quantified but do not free up budget for other activities.
• “Qualitative” benefits improve effectiveness, responsiveness and/or risk management in ways that are beneficial but not easily quantified.

A project lifecycle typically has four stages. Refer to the chart below for 2006-07 OntarioBuys funding eligibility.

Stage	Output	Secretariat's Funding Proportion	Participating Institutions' Funding Proportion
1. Feasibility Study
	Project scope and elements identified Costs and benefits estimated Participating organizations committed in principle	0%	100%
2. Implementation Analysis (IA)
	Detailed project analysis and workplan completed, including all costs and benefits Participating organizations committed to proceed Project funding arranged Key output: viable project plan ready to implement	Up to 100%
3. Implementation Project (IP)
a) Regional Project	Participating organizations committed to implement Project implementation completed	Up to 75%	at least 25% (min. 5% cash)
b) Foundational Project		Up to 85%	at least 15% (min. 5% cash)
4. Post Implementaion
	Project evaluated Adjustments made as required Future recommendations/lessons learned	0%	100%

Funding for OntarioBuys projects is typically provided in multiple phases over time corresponding to a set of detailed deliverables.

The BPS Supply Chain Secretariat works closely with prospective funding applicants and the relevant sector ministry (e.g. MOHLTC, MEDU, MTCU). Organizations are encouraged to share drafts of the application while the project is still in the formative stage so that the Secretariat can provide comments on the project to address gaps or points of clarification relative to funding requirements.

Projects must meet all the following criteria to be considered:

• Raise awareness of integrated supply chain management (iSCM) and back office leading practices in the BPS
• Engage participants to undertake supply chain and back office transformation and implement iSCM leading practices
• Deliver measurable and meaningful results

Proposals will be evaluated on the criteria above as well as factors such as:

• Extent to which the proposal is consistent with the mandate of the Secretariat
• Extent to which the proposed project aligns with the vision for the sector beyond the project's timeframe (e.g. overall LHIN vision)
• Extent of participant reach and geographical coverage within Ontario
• Extent to which the project members have developed working partnerships with other BPS organizations or stakeholders
• Extent to which the project can be replicated across the sector or potential exist for application in other sectors
• Strength and reasonability of proposed measurement methodology to capture quantitative and qualitative benefits
• Ability of the project members to implement the project results based on relevant experience
• Strength of the project feasibility study and financial analysis
• Financial viability of the project's participants and sustainability of the proposal post-implementation
• Extent to which the project leverages funding from other sources
• Communication opportunities for the Secretariat or Province
• If applicable, level of commitment on the part of sectoral associations to commit to tangible, measurable actions with its members e.g. OHA, ACAATO

• Although, there are no formal application forms or fixed application submission dates, there is a set process for applications and templates are available to assist applicants in creating funding application documents. The following section, Funding Application Elements, discusses the content of the applications in more detail.
• If you believe your project is eligible, you should first discuss with a Program Manager at the Secretariat before developing a Project Overview. During this step, Secretariat staff will need to understand the objectives of your project to assist you throughout the application process. A key criterion at this phase will be your project's fit within the existing projects portfolio and the fit with the OntarioBuys strategic objectives.
• Once a project has been discussed, you will need to provide a Project Overview to the Secretariat for consideration. Secretariat staff will review the application and will typically provide feedback within 4 weeks of receiving the Project Overview.
• If the project meets the 2006-07 funding criteria, a detailed Implementation Analysis (IA) Business Case is required as the formal application for funding the IA stage. In some cases, a feasibility study will be necessary to develop the IA business case, which will not be funded by the OntarioBuys program. In general, feedback will be provided within 6-8 weeks of receiving the detailed IA Business Case. For complex projects, external expert reviewers may be engaged by the Secretariat as part of the application assessment. Once approved, a transfer payment agreement will be entered into with the Ministry of Finance whereby the funding schedule and project deliverables for the IA stage will be established.
• Once a project has completed the IA stage, the final report will be used to develop the Implementation Project (IP) Business Case. The same process, as described above for a project entering the IA stage, will be used to evaluate the IP Business Case and initiate a transfer payment agreement for the IP stage. In some cases, projects may not require an IA stage and may be eligible to advance directly to the IP stage.
• If an application is unlikely to be approved, applicants will be told as early in the process as possible.

There are 3 types of funding applications that may be submitted throughout the project lifecycle: Project Overview, IA Business Case and/or IP Business Case. By way of general guidance, outlines and templates have been created that describe the elements that must be incorporated into the different types of funding application documents. The format and content of a funding application may vary depending on the project's goals and scope. Contact the Secretariat directly for project-specific guidance.

Refer to the IA/IP Business Case template³ which can be used to guide the writing of your application.

Project Overview
Project Scope & Objectives: Summary of the proposed project – what the implementation would accomplish Current state Envisioned future state and business objectives (which should be consistent with the iSCM mandate and iSCM leading practices)4 Operating governance, accountability and funding model Expected qualitative and quantitative benefits Estimate of expected costs and assumptions Project history and proposed next steps Project governance and accountability List of participating institutions, executive sponsors and project sponsors (names and titles), including nature of commitment if variable
IA/IP Business Case
Executive Summary Current State Environmental Analysis List of participating institutions, executive sponsors and project sponsors (names and titles), including nature of commitment if variable Future State Envisioned future state Goals and Objectives (which should be consistent with the iSCM mandate and iSCM leading practices)4 Approach to each of: group purchasing, logistics, and information systems Back office elements in addition to supply chain, if applicable Governance, accountability and operating funding model
Cost and Benefit Analysis Infrastructure Analysis – HR and IT options Cash, capacity and qualitative benefits Estimate of the expected costs and assumptions
Implementation Strategy Project governance structure and accountabilities Project organizational structure (internal resources to be contributed and external services required) Project Human Resources Management Strategies Who will do the work? Who will be additionally involved or consulted? How will “who” be determined consistent with the Secretariat's Procurement Guidelines? How will a dedicated project manager be engaged? A clear and concrete list of project deliverables Work plan and estimated timeframe (timetable or “Gantt chart” format with milestones) Project budget (detailed costs by project sections or phases), payment timelines, and proposed funding sources Change management, human resources, including collective agreement implications, and transition plans Project stakeholders and communications management plan including any other participants or other stakeholder considerations of particular note Risk identification and management (including probability, impact, mitigation strategy and responsibility) Links (if any) to other related projects, delineating their respective objectives Name of the legal entity that will be contractually obligated to MOF and the individual at that organization who would sign and has the capacity to sign the Transfer Payment Agreement
Acceptance and Sign Off Signed evidence of sponsoring organizations' executive commitment to the project (e.g. commitment letter, board resolutions)
Appendices Any additional supporting background material

Endnotes

¹ Integrated Supply Chain Management (iSCM) - "Shared Services" - functions unified into a single new entity under common ownership or control, or the provision of functions by one organization to others for the benefit of all.

² Back Office Transformation (BOT) - Driving efficiency, effectiveness and responsiveness through systems that do not deal directly with the customer such as inventory management, accounts payable and human resources.

³ see "Sample Business Case"

⁴ see "Integrated Supply Chain Management: A Leading Practices Compendium"