3A RFP Sample Report - Facweb.cs.depaul.edu

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IS483 RFP

RFP

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IS483 RFP

RFP

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TABLE OF CONTENTS


A.
ORGANIZATIONAL ANALY
SIS

................................
................................
.............

3

1.

T
HE ORGANIZATIONAL MI
SSION
,

GOALS AND STRATEGY

................................
.............

3

2.

T
HE
IS

ORGANIZATIONAL STRUC
TURE AND ITS RATIONA
LE INCLUDING ORG CHA
RT
.

..

4

3.

T
HE ORGANIZATION OF
IT

OPERATIONS AND RATIO
NALE

................................
............

6

4.

T
HE
IS

G
OVERNANCE FOR
D
ETERMINING
S
TRATEGIES AND
T
ACTICS

.........................

6

5.

T
HE
IS

E
VALUATION AND
P
ROCUREMENT
P
ROCESS

................................
....................

6

B.
REQUEST FOR PROPOSAL
................................
................................
.....................

7


1.

N
EEDS
S
PECIFICATIONS

................................
................................
..............................

7


2.

M
ANDATORY
F
EATURES

................................
................................
.............................

7


3.

D
ESIRED
F
EATURES

................................
................................
................................
....

8


4.

P
ERFOR
MANCE
D
ATA
R
EQUIRED ON THE
V
ENDOR

S
S
OLUTION

................................
.

8


5.

C
OST
D
ATA
R
EQUIRED ON THE
V
ENDOR
'
S
S
OLUTION

................................
................

9


6.

I
NFORMATION
R
EQUIRED ON THE
V
ENDOR
F
IRM

................................
.....................

10


7.

D
OCUMENTATION REQU
IRED FROM THE
V
ENDOR

................................
.....................

12


8.

G
ENERAL
I
NFORMATION FOR THE V
ENDOR

S USE

................................
.....................

12


9.

R
EQUEST FOR VENDOR DE
MONSTRATION

................................
................................
.

14

10.

P
ROCEDURAL
D
ETAILS

................................
................................
.............................

15

11.

S
CHEDULE

................................
................................
................................
................

16

12.

G
ENERAL
R
EQUIREMENTS

................................
................................
........................

17

C.
FINAL CHOICE

................................
................................
................................
........

18

D.
COST/BENEFIT PROJECT
ION

................................
................................
.............

19


APPENDIX

................................
................................
................................
......................

22

V
ENDO
R
E
VALUATION
C
RITERIA AND QUESTION
S

................................
.........................

22

***G
ENERAL
V
ENDOR INFORMATION

................................
................................
............

23

Name of Company

................................
................................
................................
.....

23

C
OST
/B
ENEFIT
P
ROJECTION

................................
................................
...........................

25

Cumulative Savings

................................
................................
................................
...

26

REFERENCE
S
:

................................
................................
................................
..............

27











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A. O
rganizational Analysis

1.
The organizational mission, goals and strategy


Health Care Service Corporation (HCSC) has the Blues. HCSC is made up of Blue Cross
Bl
ue Shield of Illinois (that state's oldest and largest health insurer),
Blue Cross and Blue
Shield of Texas
, and Blue Cross and Blue Shield of New Mexico. A licensee of the
Blue
Cross and Blue Shield Association
, the mutual company provides a range of group and
individual insurance and medical plans to some eight million members, including
indemnity insurance and
managed care programs. HCSC also offers prescription drug
plans, Medicare supplement insurance, dental and vision coverage, life and disability
insurance, workers' compensation, retirement services, and medical financial services
through subsidiaries. The
ir mission statement: “To provide high
-
quality, cost
-
effective
health care to as many people as possible in all the markets we serve.” The company
identifies five pillars that will be part of the strategy to hold up this mission: A Trusted
Brand, Member
ship Growth, Best Service, Lowest Medical Cost and Competitive
Administrative Costs. Their current high
-
level goal is to double their membership from 8
million members to 15 million members in three years to develop a strong financial
position to provide
flexibility for crucial investments (i.e. technology, partnerships) and
robust human capital to execute the corporate strategy. Part of their strategy also
involves continued growth as an organization, investing in their employees, investing in
new techno
logies and in new markets.


HCSC’s fiscal year ended December 2001 stated sales of $6.198 billion with a
phenomenal 1
-
year sales growth of 40.6%. 2001 Net Income was $387 million resulting
in a 1
-
year net income growth of $122.8%. Needless to say, they h
ad a banner year in
2001. HCSC employs around 11,500 people across Illinois, Texas and New Mexico.
Their entire IT personnel come to be around 1200 people.


As a “not for profit” organization, HCSC believes there is a philosophical difference
between “Fo
r Profit” plans and “Not For Profit” plans:


A
“For Profit”

plan provides a service to make a profit.

A
“Not For Profit”

plan makes a profit to provide a service.


These different philosophies, missions, goals and strategies are communicated almost
daily t
hrough emails, PowerPoint presentations, meetings, corporate mugs and plaques
and TV screens on every floor.


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2.
The IS organizational structure and its rationale including org chart.


HCSC’s organizational structure is relatively vertical in that at the

top there is the
Executive Vice President of Health Operations who also acts as Chief Information
Officer. The rationale of the overall IT structure is derived by the fact that there are four
critical organizational processes: Plan, Build, Run and Transf
orm. The Plan process
involves long term IT goals and strategy and is headed by the Chief Technology Officer.
The Build process involves business applications headed by the Chief Application and
Customer Service Officer. The Run process involves the net
work and infrastructure
headed by the Chief Infrastructure Officer. And, finally, the Transform process involves
transforming the business into and e
-
business headed by the Vice President of the e
-
Solutions Office. Under these higher level executives are

Directors, then Managers, then
Supervisors and Team Leads.


Organizational Process View

Joanne M. Rounds

Executive Vice President of Health Operations

Chief Information Officer

Information Technology Group

Plan

Build

Run

Transform

Addison McGuffin

Brian Hedberg

Andrew Kerr

Tom Riley

Chief Technology
Officer
Office of
Technology,
Architecture and
Strategy

Chief Application
and Customer
Service Officer

Chief Infrastructure
Officer

Vice President e
-
Solutions Office
(Matrix to Chair of
CABCO)

Enterprise
Architecture
Services (EAS)

Application
Development and
Maintenance

Network Operations
and Engineering
(ENS)

e
-
Solutions
Planning, Strategy,
and Prioritization

Application and Data
Architecture
Standards:
Mainframe and
Distributed

THIN
, REDILink
(Provider
Automation)

LAN Technical
Services (LTS)

e
-
Solutions Budget

Enterprise Technical
Services (ETS)

Customer Support
Services

Desktop Software
Services (DSS)

e
-
Solutions
Marketing

IT Application
Support

Customer Advocate
Group (CAG)

Remo
te Site
Services (RSS)

e
-
Solutions
Communication

IT Strategy and
Planning

Help Desks

Voice Technical and
Administrative
Chair of Steering
Committee for
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Services (VTS)

Consumer Driven
Health Plan

CAP (matrix with
OITM)

Project Management

End User Computin
g
(EUC)


Human Capital
Architecture

Problem
Management and
Change Control

Intranet, Internet
Infrastructure (3IS)


Office of Enterprise
Security and Chief
Security Officer

ITG Budget and
Metrics

Data Center


IT Business
Continuity Planning
and Disaster
Recovery

ITG Procurement
and Contract
Management

R&D Infrastructure


IT Quality Assurance

Demand
Management

ACS Contract (IHS)


ITG Audit Liaison

Database
Administration and
DBAs

Output Services
Center (OSC)


Application Portfolio
Management

Enterprise
Data
Warehouse



R&D Research

OITM portion of CAP




Systems Testing
and Support




Asset Management






HCSC’s corporate IT theme is: “To Run IT as a Business”. What this means is that
every IT decision should be centered upon adding business value
. Whether it is
purchasing a PC or purchasing a full blown ERP system, it should be to add business
value to the organization. It also means supporting the corporate mission.

The structure does reflect support for the mission of the organization by findi
ng ways of
cutting costs and providing better service to its members. IT, especially at the higher
levels, is always aware of the higher goals of the organization and how they can help in
achieving those goals. The management also communicates these goal
s and corporate
mission whenever they give presentations about different IT projects or during annual
department meetings.


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3.
The organization of IT operations and rationale

Due to the fact that this organization is relatively large, has an established h
istory and is
made up of plans from different States there is a mixed
-
bag of IT operations.
Historically, as large insurance companies invested in large mainframe systems, the
company still maintains many of their mission critical systems on a centralized

platform
using COBOL, VSAM and CICS. In fact, IBM lists BCBS of IL as one of the largest
CICS shops in the world. Its Claim System called BlueChip is a very large
COBOL/CICS system using VSAM as a form of database. They also have a
decentralized enviro
nment with some Sun mini
-
computers and IBM RS/6000 computers.
They also have a distributed environment as in the Intranet system as well as client
-
server
applications purchased from PeopleSoft. Their Disaster Recovery Data Center is
outsourced to IBM. T
hey are also using IBM’s Global Services division to have
programmers overseas maintain and support certain membership applications.


4.
The IS Governance for Determining Strategies and Tactics


The important strategic and tactical decisions are generally

made by the CIO/Executive
Vice President of Health Operations due to the fact that these major decisions involve
multi
-
million dollar investments and so must be approved at a high level. Much of the
top
-
level decision making is made through the advice of

the IT Cabinet Members made
up of the Chief Technology Officer, Chief Application and Customer Service Officer,
Chief Infrastructure Officer and the Vice
-
President of the e
-
Solutions Office as well as
certain select members depending on the type of projec
t. Each of these Officers
determine which areas of the organization get affected by a certain project and
communicate with the Directors who communicate with Managers who ultimately
communicate to Supervisors and front
-
line employees what steps are requir
ed to take on
a project. RFPs are generally written by the Customer Advocate Group which acts as a
liaison between the business and IT communities. As business managers and IT
managers discuss a certain business problem they decide whether there are enou
gh
resources or knowledge to solve the problem in
-
house or to request outside help.


5.
The IS Evaluation and Procurement Process


The Customer Advocate Group (CAG) along with Senior Executives and Directors are
involved with the evaluations process of a
specific service or product that requires an
RFP. The evaluation is performed after a review of the proposals and product/service
demonstrations provided by the vendors. Part of the evaluation comes from the Rating
Responses from the vendors for each que
stion/requirement asked for by HCSC in the
RFP. The rating responses range from 0 to 5.


For each requirement/question, the vendor must respond selecting one of the following
choices:


5


Comply. Included in the base or “out of the box” functionality.

4



Not included in the base product but can be provided now by a current
customization to the base product.

3


Provided by a third
-
party partnering arrangement.

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2


Not available, but will be available in the next 12 months.

1


Not available, but wil
l be available within an undetermined timeframe.

0


Not available and will not be available.


The vendors’ responses to these type of requirements along with a weighted score for
criteria such as Cost, Functionality, Flexibility, Service and Support al
l factor into the
evaluation process. As far as purchasing applications the Chief Technology Officer
oversees Application Portfolio Management for the many applications that exist in the
company. So an evaluation must be made as to how this purchase will

affect other
business and IT areas.


The Procurement Process is a formal process that involves the areas of ITG Procurement
and Contract Management, ITG Budget and Metrics as well as the Finance Department.
For example even with “smaller” Purchase Reques
ts (PR’s) multiple signatures must be
obtained as follows:




Executive Management Group Member (EMG) for PR’s up to $15,000



Executive Business Group Member (EBG) for PR’s up to $50,000



Executive Leadership Group Member (ELG) for PR’s up to $100,000


But a
t the higher level with multi
-
million dollar projects the CIO and Cabinet Members
are involved in the procurement process. As a general rule there are preferred vendors
for consulting services and hardware purchases. It is at the CIO level that decisions

are
made as to which vendors are preferred based on their knowledge of the business and rate
effectiveness. There are currently around 7 or 8 consulting firms considered preferred
vendors. Much of the hardware purchases are made from more established co
mpanies
like IBM and Compaq.

B.
Request For Proposal

1.
Needs Specifications


The HCSC

is the oldest and largest health insurance company providing superior
products and preeminent service with competitive prices. As a result, the customers are
everythin
g to the company. Customer’s satisfaction need to be improved as this is one of
the company’s objective. This Request for Proposal is being sent to selects vendors in
order to help meet our functional needs in the areas described in this RFP. A complete
so
lution, including in recommending hardware and/or network topology change as well
as new software that help manage and manipulate customer record and gain satisfaction
during the calling experience to our company.


2.
Mandatory Features


Our IT and Custom
er service departments have been working together and
generate and develop the general selection criteria. The following features are the
significant points that must be addressed in the proposal.

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What customer information do you need to keep that you are
not keeping now? This is a
vague list that really fits any number of applications.



Software’s Functional needs



Accessing, Editing, Updating, Deleting, Reporting the information



Data mining and Manipulation



Tracking Records



Ability to generate DSS(Decision

support system)



Secure transaction process



Real
-
time Processing



Recording Time Log per Customer calling



Business’s Functional needs



Friendly Interface



Cost Effective and Efficiency



Service and Support including Warranty



Easy to monitor and maintain the sy
stem



Ability to request information from departments with ease



Minimum implementation time



Hardware Recommendation



Any Recommendation in changing in Network topology to suit the
software package


3.
Desired Features


The HCSC

is basically always working w
ith customers as well as hospital,
banking institutions, police departments and other insurance companies. For this reason,
the preferred solutions should contain as the following;




Ability to merge and implement with current database



Fit with our current
network technology



Recovery Plan as well as ability to recover accidental file deletion



Hardcopy and Softcopy manual for later implementation as well as coding
blueprint



Ability to connect to other institution with maximum security



Self On
-
line system main
tenance


Ability to self recover from the serious
crash or software through the Network



System support
-

Bug Free


4.
Performance Data Required on the Vendor’s Solution


Vendors need to include the following list of information in order to help
HCSC

sele
cting the most appropriate candidate regarding with vendor’s solutions;




Average down time


Server failure, High Traffic, Data Collision

o

Expect none to minimum downtime if the servers go down?

o

Ability to self
-
recover within maximum of 5
-
10min?



System Requ
irement

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o

Usability with our current platform, operating system and database
server

o

Any optional software or equipment necessary for solution?



Server Capacity

o

Maximum users for the system to handle

o

Response and processing time to a request



Back up procedure

o

How frequent does it required for backing up?

o

Automatic or manual back up?

o

How long does it take to back up the entire database?

o

Can the database backup procedure be customized according to future
need?



Security Method

o

How secure does the software provide?

o

What is the security method?

o

How long does the transaction process passing the security back
-
end?



Data Processing and Data flow

o

How fast does it take to process the information?

o

Can the data be accessing and updating be used by more than one
user?



Availab
ility of Service

o

Is there any chance that the database will malfunction and stop
working?

o

Will the maintenance disrupt the service?





5.
Cost Data Required on the Vendor's Solution

Vendors are required to provide the comprehensive, itemized and detai
led price
quotations for their products. Any applicable local, state or federal taxed should be
included. The time frame for the prices is valid is also required.




Cost Quotations


Cost quotations must be itemized and include all costs (e.g., recommended
hardware platform, operating system, license fees, source code, object code,
implementation and training, travel and per diem, documentation, annual
maintenance and support, and hourly rates). The following format should be used
to present cost quotations
.


Cost should be itemized by software module. If the majority of the modules are
included in a base system, the included modules should be listed, along with the
separate costs for the license fee, the installation /customization/ conversion costs
for th
e package, the training for the package, and the annual maintenance fees for
the first years of maintenance. This breakdown should be repeated in detail for
each optional software module or other optional service. As much as possible, it
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should be in cha
rt form. A summary cost sheet showing totals brought forward
from each detail sheet covering the entire submission should also be provided.




Recommended Hardware

Provide complete data on all initial costs as well as annual maintenance costs for
the hardwa
re platform and operating system that you believe best satisfies the
needs of HCSC.




Application Software

Provide complete data on all initial costs to license the software being proposed,
including source code, object code and documentation. Indicate the

modules
included with each software system and associated costs, if applicable.




Implementation Support and Training

Provide complete data of all initial costs for implementation support and training
of all products being proposed, including travel and pe
r diem expenses.





Maintenance

Provide complete data of all maintenance costs for the first five years for all
products being proposed. Include maintenance costs for any additional software
being proposed and associated costs, if applicable. Because ther
e is anticipated
growth over the next five years, please describe pricing structure for additional
users.




Additional Services

Provide complete data of all costs for any additional services that may be
contracted for, including consulting services for syst
em implementation, data
conversion and migration, programming services for software modifications and
additional training.




Financing and Outsourcing

Provide any information on the availability of financing of the proposed system
and/or outsourcing of oper
ational services.


Note: Indicate the time frame for which these prices are valid, along with any
advance agreement packages available for deferred purchase of additional
system modules and/or components.


6.
Information Required on the Vendor Firm

In ord
er to evaluate you (the vendor) for reliability and experience, there are
certain types of information that must be provided. Please answer the following
questions:


a. Information about the vendor’s company:



Name



Home office address

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Address of nearest sal
es/customer service office to Chicago



Name, title, telephone, fax, and e
-
mail address of contact person



Short
-

and long
-
term mission of the organization. Specify your product
development goals, and your vision of the future of this software.


b. Informati
on related to staffing:



Size of staff

Allocation of staff among the following areas:


a. Research and development


b. Customer service/support


c. Sales


d. Administration

c. Information relating to product:



The product brochures



Options for customizing ce
rtain workstation and groups of workstations



How the new releases are installed



When are the new releases are scheduled

d. Information relating to product training:



Describe any functional training the vendor requires of HCSC



Describe the courses of traini
ng provided to enable the staff to become familiar
with software’s functions and operations, including, but not limited to:

o

A list of all deliverable training modules.

o

Whether instructors are available to train on
-
site.

o

Maximum number of trainees per class

and the total number of days of
training for each module.

o

Whether it is possible to purchase additional training days

o

Availability of other training aids such as videos, software tutorials, or
Web
-
based instruction.

o

Availability of computer
-
based training
.



Indicate if training sessions for systems administration cover topics, including, but
not limited to:

o

Common causes of software failure and the remedy for each.

o

How to obtain telephone support for the correction of system problems.

o

How vendor tracks prob
lems and assigns severity priorities.

e. Information on references from vendor’s current clients:

HCSC will be relying on vendor references to provide verification of both software and
vendor performance. Proposals shall include references allowing the co
mpany to obtain
information regarding overall performance and satisfaction with the software as well as
for specific modules from companies comparable in size and complexity to HCSC.
Representatives from the Evaluation Team may, at their discretion, choos
e to conduct
telephone interviews or site visits with references.


Vendors must provide:



Complete customer list of companies that have implemented the proposed
software.



Customer contact information.

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Prior software used by the customer.



Date the customer

implemented the proposed software.



Average volume of records in each customer database.



Results of any customer survey taken during the past year.



Contact information for the software’s user groups and address of online
discussion groups.

7.
Documentatio
n required from the Vendor

DIVISIONAL FINANCIAL STATEMENTS

For Fiscal Years 2000, 2001, 2002 please provide:



Installed base for this product (by version/release)



Unit sales for this product (by version/release)



Income statement information for this product

(by version/release)

o

Revenues for product sold

o

Revenues for service sold

o

Cost of products sold

o

Cost of service sold

o

R&D

o

Sales, general & administration

o

Net earnings from product

o

Net earning from service

CORPORATE FINANCIAL STATEMENTS

For Fiscal Years 2000
, 2001, 2002 please provide:



Balance Sheet



Income Statement



Cash Flow Statement



Statement of Owners Equity


8.
General Information for the vendor’s use


a.

Overview of firm and its services and product

The HCSC

is the oldest and largest health insurance comp
any in
U.S.

with a six
-
decade tradition of providing high
-
quality, affordable health care plans that meet
the needs of employers and families.
The HCSC

is committed to the highest
standards of business ethics and integrity as well as strict observance and

compliance with the laws and regulations governing its business operations.


Today,
HCSC

strives to balance customer demand for superior products and
preeminent service with competitive prices. Through the parent corporation or
one of its subsidiaries,
HC
SC

offers group and individual traditional indemnity
insurance, managed care products, such as HMO,

PPO, point
-
of
-
service, Medicare supplemental coverage, dental, vision, life,
disability, retirement products, managed mental health and prescription drug
c
overage. BlueCross BlueShield of IL
, which is part of HCSC

also administer the
Illinois Comprehensive Health Insurance Plan (ICHIP).

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The following is the overview of
HCSC

architecture;


Network Server


Microsoft 2000 Professional Server and Unix

Database

Server


Oracle 9i

Client desktop


Microsoft XP for Business

LAN/WAN Protocol


TCP/IP

Network Connection speed


10/100Mbps using fiber optic

Computer Telephony System


Automatic calling Distribution integrate with PBX


b.

Projected Rates of Growth

The
HCSC

estimated about 10 percents growth’s rate in customer relationship
department. This project should be able to improve customer’s satisfaction as well
as maximize the use of organization’s database.


This project will expand the customer relationship
officer by new 3
-
5 personnel.
The organization expects the current employees to train in this new software. This
personnel increase in customer relationship department is about 6
-
10 percent
growth rate.


For the software and database growth rate, we expect

to go from 8millions to 15
millions customers in 3 years



C. Data Volumes

HCSC

of IL has approximately 500 computers and 400 employees in the branch.
The system is able to link between the entire departments in the organization as
well as the ability to
adapt the database from Headquarter. Every department is
able to request and access the database in real
-
time at the same times without any
problem.


When the project is initiated all of the employees in our organization should be
able to use their comput
ers as normal. The average users at the business hour
(8.30am


6.00pm) accessing the database are approximately 300 users per hour.


D. File Characteristics

Currently,
HCSC

is using Oracle 9i database application. The database and
application are integra
ted and used by the entire departments, which include
marketing, customer relationship, Information Technology, Human Resource and
Financial departments.


E. Input/Output Characteristics

The HCSC

prefers the software to be able to integrate with the compan
y’s
intranet, which includes the database from the Headquarter. Personnel in
Customer Service department should be able to access and request the
information from the database as well as inputting the additional, editing, deleting
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and updating any necessar
y information into the system. The report generation
should contain the function to preview and adjust the information on the screen.


F. Response Times

The HCSC

has our own IT departments with expert staff. We have just invested
to upgrade and buy new com
puter and network equipment. Our workstations and
database servers are equipped with the high processing power. The data transfer
within our organization is superb since we are using fiber optic technology to
ensure the data integrity and reliability.


Due

to the technology we have we require the following response time



Minimum response time: 1
-
5 seconds, for the function of accessing and
requesting information



Average response time: 5
-
10 seconds, for the function of updating, editing
and deleting informati
on



Maximum response time: 10
-
15 seconds, for the function of manipulating
the information


G. Special Constraints



Possibly parallel conversion plan is need to let the current customer
relation to adjust with the new systems



Simultaneous conversion also is
possible, manipulating the database and
avoiding the incompatible of data.



The
bidder

must provide one year on
-
site service, including parts and
labor, a 24/7 response by phone and email and five year warranty is
required




9.
Request for vendor demonst
ration



The demonstration should provide
HCSC

with a clear and understandable
introduction and examination of the product. This demonstration will help to analyze and
identify the quality and service from the vendor. The demonstration date is set on the
s
chedule in which the vendor and
HCSC

will work together.


Our customer relationship manager and staff will involve in this demonstration as well as
our human resource manager, IT manager and 2 IT Coordinators. They will interview and
work with each individ
ual vendor.


This demonstration should highlight:



How to monitor call control



Call control customization



Data manipulation between departments



User interface



Standard Procedure of how the software will work

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Software performance


how fast the system can
run on our clients



Software compatibility


the ability to adapt to our working system



Functionality of the system



Data storage format and how to optimize the storage



System support and back up plan




10.
Procedural Details


Procurement Manager

The vendo
rs can contact the assign Procurement Manager who is responsible for the
ongoing management of this project including managing the bidding relationship between
vendor and
the HCSC
.

Name, address, e
-
mail address and telephone number of the
procurement manag
er can be found below.


Roberto Ayala

IT resource manager, Information Technology Department

Health Care Corporation.

BlueCross BlueShield of IL

300 E. Randolph

Chicago, IL 60601
-
5099

Phone: 312
-
653
-
6000

Fax: 312
-
819
-
1220

RobertoAyala@HealthCareCorporation.com



All of the inquiries, questions and contracts should be submitted to the procurement
manager in which he will be glad to help answer any such requests. No other staff from
HCSC

has
the authority to response to your inquiries. Violate this restriction will result in
a disqualification.


Any written inquiries received by March 24, 2003 will be responded. All proposals must
be submitted to the procurement manager before March 24, 2003 5
:00 PM


Any inquires can be e
-
mail or fax to the procurement manager, but we ask the bidders to
keep the number of questions submitted via email at a minimum.


Vendor Contact


Please provide a single point of contact for subsequent conversation and potent
ial
negotiation. The contact should have the ability to make the decision of the project
arrangement as well as the ability to authorize the negotiation and approved contracts.
Please provide us with the following information for this contact:




Vendor’s Co
ntact Name



Vendor’s Contact Title

IS483 RFP

RFP

16



Company Name



Company Address



Phone Number



Fax Number



E
-
mail address


11.
Schedule


Bidder Conference

Bidders will be able to ask more specific questions during the Bidder Conference at
HCSC
, which is scheduled for March 1
4, 2003. During the event the detail and
constraint of the project will be officially presented as well as the overview of the
proposal. The procurement manager is willing to answer any written questions from
any prospective Bidders regarding any bidding
concerns.


The identity of the organization submitting the question(s) will not be revealed.
Additional written questions may be submitted at the conference. All written
questions will be addressed at the conference.


The HCSC

will not hold any responsib
ility and assumes no liability for any cost or
expense that Bidder may incur if the Bidder elects to attend to this conference.


Proposal Due Date

The proposal due date is set on March 28, 2003. In order to make the proposal valid,
the proposal documents m
ust be submitted to the procurement manager by the time.
Any late submission will not be accepted.


The complete response to this RFP will include

1.

The Bid Package worksheets completed and submitted in an appropriate
format, preferable MS
-
Excel format.

2.

A c
opy of your proposal sign by your authorized executive officer in charge
of your company.


Award Date:
The contract will be awarded at April 28, 2003.


Schedule Table

Date (2003)

Description

March 3
rd


Issue of RFP: Sending RFP to vendors

March 14
th


Bid
der Conference

March 21
st

Due date for requesting additional
information and questions

March 28
th


Due date to submit proposal, 5:00PM EST

April 1
st



4
th


Proposal Evaluation

April 7
th



8
th


Selecting Finalists

IS483 RFP

RFP

17

April 9
th


Negotiating the Final Offer
s from Finalists

April 14
th




th


Oral Presentation and/or Product
Demonstrations by Finalists

April 21
st




th


Analyzing and Comparing the
demonstrations and presentations

April 28
th


Contract Award


12.
General
Comments


All Bidders should meet
the following general requirements:


Clarifications

The HCSC

reserves the right to accept or reject any or all proposals in whole or in
part, to take exception to parts of the proposals, and to request oral and/or written
clarification of proposals. Vendor
s may be excluded from further consideration for failure
to comply with the req
uirements of this RFP. Further HCSC has

the right not to award
the contract to any vendor, to award the contract to a vendor who is not the lowest bidder,
to determine a proposa
l to be none responsive, and to waive irregularities in the selection
process. Once a vendor has been selected,
HCSC

reserves the right to begin negotiation
with another vendor if successful negotiation of an acceptable contract cannot be
accomplished.


Ac
ceptance of Conditions Governing the Procurement

Bidders must indicate their acceptance of the conditions go
verning the procurement
section in the letter of transmittal.


Non
-
disclosure and Confidentiality

The terms of the RFP and all associated informatio
n forwarded to you from
the HCSC

is
proprietary and confidential. These materials are to be used by you solely for the purpose
of responding to this RFP. If you choose not to respond, this RPF must be returned or
destroyed.
HCSC

will treat all information

and bids submitted as part of this RFP
confidential


Incurring Cost

Any costs and expenses incurred by the Bidder in preparation, transmittal, and
presentation of any proposal or material submitted in response to this RFP shall be borne
solely by the Bidd
er. Any costs and expenses incurred by the Bidder for set up and
demonstration of proposed equipment and/or system shall be borne solely by the Bidder.


Prime Contractor Responsibility

Any contract that may result from this RFP shall specify that the prim
e contractor is
solely responsible for fulfillment of the contract with
HCSC
.
HCSC

will make contract
payments to only the prime contractor.


Sufficient Appropriation

Any contract awarded as a result of this RFP process may be terminated if sufficient
IS483 RFP

RFP

18

app
ropriations or authorizations do not exist. Sending written notice to the contractor
will effect such termination. The contractor as final will accept
HCSC’s

decision as to
whether sufficient appropriations and authorizations are available.


Legal Review

The HCSC
requires that all Bidders agree to be bound by the general requirements
contained in this RFP. Any concerns must be promptly brought to the attention of the
Procurement Manager.


Governing Law

The laws of the State of Illinois shall govern this
procurement and any agreement with
Bidder that may result.


Bidder’s Terms and Conditions

Bidder must submit with the proposal a complete set of any additional terms and
conditions which they expect to have included in a contract negotiated with
HCSC.


Own
ership of Proposals

All documents submitted in response to this RFP shall become the property of
HCSC
.
However, any technical or user documentation submitted with the proposals of non
-
selected bidders shall be returned to the bidders.



C.
Final Choice


After rigorous review of all submitted proposals.
HCSC

has decided to outsource
t
heir call center CRM package from Siebel. Siebel call center technology is globally
proven product. Siebel call center CRM is the only package operational in Asia and
Australia. Also, the product is scalable from small size to super size. Siebel
demons
trated their know
-
how in communication CRM better than other vendors, and also
it meets with the need of Blue Cross.

BlueCross BlueShield needs call center CRM for these reasons.



Minimize cost of operation



Unified and centralized customer interactions



To
ols to improve customer satisfaction and increase revenues



Real
-
time reporting and analytics



Knowledge base for strategy and operational decisions.

Siebel and other vendor comparison are attached on Appendix.


Sieble Call Center CRM package will help
HCS
C
to achieve greater efficiencies
in its customer satisfaction and will help the marketing base of
HCSC

sales strategy.
With Siebel’s technology in com
munication, HCSC

can implement various
communication tools into one portal. For example, a sales repres
entative can check their
voice mail, email, detail information of a client, and history of the client in one web site.
IS483 RFP

RFP

19

With the call center technology we minimize customer’s call wait time and maximize
first call resolution rate. This also helps
HCSC

ope
rating cost of call center management.


Phased approach

The HCSC

will implement Siebel call center CRM in phases, addressing priority
areas first. Since
HCSC

only implements Siebel’s call center technology on
HCSC

existing system, first phases will be int
egration process. After Siebel understood, and
analyzed
HCSC

call center architecture and operation procedure, Siebel will process to
the next phase.

On second phase, Siebel will customize their call center technology, which will be better
than existing c
all center in cost and time.

Third phase of implementation, Siebel will implement call center CRM that will be
synchronized to
HCSC

sales department. By doing so, Sieble will achieve
HCSC

automation of call center and enhances sales department.


Future
Plans

The HCSC

provided their services only in North America. With rapid
development of Internet, World is getting closer in real time.
HCSC

can adapt and use
this opportunity.
HCSC
can alliance with a Healthcare company in a developing country.
With S
iebel call center technology globally accepted
HCSC

can expand and manage their
market share, services customers, and being profitable. With the global scale blue print
aside,
HCSC

can expand their sales management reconstruction as next future plan.


D.

Cost/Benefit Projection

Total Benefits of company implementing CRM application of Call Center
automation system will improve customer satisfaction, reduce costs, and improve agent
productivity over the next 5 years is approx $ 7.09 M with total cost about

$ 5.7 M (see
Appendix D for Cost

benefit Detail)


Breaking down in production:



Payback period of 2 years.



Return on Investment (ROI) 23.05 %



13% decrease in operating costs



20% increase in their customer satisfaction levels



19% increase in employee produ
ctivity


A number of other measurable benefits of implementing this solution are:



Allowing call center agents to be more productivity by increase telephone
call per agent and reduce call handling times.



Management is enabling to schedule and track account
-
relate activities,
track product and services.



Collective asset profile, activities, service issues and sales opportunities of
related individuals to more intelligently manage customer relationships.



Allowing company to minimize the total cost to serve cus
tomers and
improve service effectiveness by extending service and support operations
IS483 RFP

RFP

20

to the Internet using Web service solution which available 24 X 7.

IS483 RFP

RFP

21






















IS483 RFP

RFP

22


Appendix

Vendor Evaluation Criteria and questions

General Company Information: In
formation on Vendor.

P
rovide the address, phone and fax numbers of your corporate headquarters.

Please provide us size of your company, number of employees, and Chicago office
information.


Company Financial Information

Please provide us with your company’
s financial statements and related information:



Annual reports for the past three years.



10K reports for the past three years.


If your company provides many products and services, other than those being proposed,
please list the total annual sales and rev
enue generated by the specific products that your
are proposing in your response.


Market Viability

Please provide us list of products and services offered by your company, and client’s list.

If client is a HealthCare company, please give us detailed infor
mation on that client
within the boundary of confidentiality agreement.


Industry Experience

Please provide us history of the proposed product. Also, report any related lawsuits
involved with the product.

Also, provide us minimum six references of clien
t using the proposed product.


Training

Please, provide us lists of training offered by your company. Describe in detail with cost,
time, and location.


Tech Support

Please provide us the tech support information. It needs to be in great detail. Need to

list
technical support in Chicago area. If there is none, your company need to list backup
tech support plans.


Integration Capabilities

Please, provide us the list of platforms supported by the proposed product. The platform
information needs to be in
great detail. We need to have minimum condition to the
maximum condition of platform.


Implementation Services

IS483 RFP

RFP

23

Please provide us the transition plans and information of personnel who will be involved
in transition phases. Need to know testing plan and re
gression testing plans.


Maintenance/On
-
Going Support

Please provide us warranty information.

Please provide us user manual of day
-
to
-
day operation.

Please provide us access information to your company’s knowledge base for the proposed
product.

Please prov
ide us the personal information
for our company’s primary technical contact.


Implementation Time

Please provide us implementation time schedule.

With schedule, list contingency schedule.


***
General Vendor information

Name of Company

Siebel Corporation

(
C
all Center 7.5
)

PeopleSoft,Inc.

(Peoplesoft 8)

SAP America
Inc.

(mySAP)

Address

2207 BridgePointe
Parkway

San Mateo, CA 94404

4460 Hacienda
Drive
Pleasanton, CA
94588
-
8618

Neurottstrasse 16
Walldorf GM
69190 Newtown
Square, PA 19073

RFP #

2002
-
292

2002
-
292

2002
-
292

Vendor Proposal
Number

48378

8678XY485

5858

Date bid submitted

3/27/2003

3/28/2003

3/22/2003

Contact

(800) 647
-
4300
contact@siebel.com

(925) 225
-
3000
1
-
888
-
773
-
8277

(622) 774
-
7474
webmaster@sap.c
om.

Total Cost of Proposal

5.6 Million

5.1 Million

6.2 Million

Projected Date of
Completion

June, 2006

September, 2006

December, 2006

Client list

Cognos
Boeing

Deutsche Bank
Wells Fargo

Siemens (ICM)
Philip Morris

3rd

Party Consultant
Rates offered?

No

No

No

IS483 RFP

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24

3rd Party Vendors
available worldwide?

Yes

Yes

No

Payment terms

Monthly invoice
-

Net
30 days

Monthly invoice
-

Net 30 days

Monthly invoice
-

Net 30 days

Payment for late
delivery

0.5% of total contract
per week

0.5% of total
contract per week

No

Bonus for early
delivery

1.0% of total contract
per week

1.0% of total
contract per week

No

Documentation
provided

Yes

Yes

Yes

Internal
documentation
provided

Yes

Yes

Yes

REQUIREMENTS




Scalable

Yes

Yes

Yes

Requir
es new
operating system

No

No

No

GUI Interface

Yes

Yes

Yes

Internet Interface

Yes

Yes

Yes

Other modules
available

Yes

Yes

Yes

Conversion by vendor
or 3
rd

party

No

Yes

Yes

24/7 support offered?

Yes

Yes

Yes

Annual Maintenance
Fees

5% of license, 1 year

free

3% of license,
start immediately

5% of license,
start immediately

Analysis package
offered

Yes

Yes

Yes

Automatic
Reconcilliation

Yes

Yes

Yes

Email notification for
approvals & updates

Yes

Yes

Yes

IS483 RFP

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25

User training offered

Yes

Yes

Yes











**
** Final Choice evaluation information is sa
ved in 483 excel file in 483
.zip file


Cost/Benefit Projection


Item


Year 1


Year 2


Year 3


Year 4


Year 5

Total















Benefits:



























Decrease Operating Cost
1



1,
710,000

1,795,500


1,885,500

1,980,000

2,079,000


9,450,000

(Saving Cost)





















Total Benefits

1,710,000

1,795,500


1,885,500

1,980,000

2,079,000

9,450,000

NPV rate (10%)

0.909

0.826

0.751

0.683

0.621



NPV

Benefit

1,554,390

1,483,083

1,416,010

1,352,340

1,291,059



Cumulative Benefit:

1,554,390


3,037,473

4,453,483


5,805,823


7,096,882


$ 7,096,882








Development Cost:



























Software
2

(650,000)

0

0

0

0

(6
50,000)















Total Development Cost

(650,000)


-



-



-



-


(650,000)















On
-
Going Cost:



























Maintenance and
Enhancement
3

(1,218,7
50)

(1,300,000)

(1,381,250)

(1,462,500)

(1,543,750)





Maintenance











Upgrade









User Training










Change
management


























Total Operational Cost

(1,218,750)

(1,300,000)

(1,381,250)

(1,462,500)

(1,543,750)

( 6,906,250)















IS483 RFP

RFP

26

Total Cost

(1,868,750)

(1,300,000)

(1,381,250)

(1,462,500)

(1,543,750)

( 6,906,250 )

NPV rate (10%)


0.909

0.826

0.
751

0.683

0.621



NPV Cost

(
1,698,693)


(
1,073,800)


(
1,037,319)


(
998,888)


(
958,669)


Cumulative Costs:


(
1,698,693)

(2,772,493)


(3,809,812)


(4,808,700)


(5,767,369)


$ (5,767,369)





























Cumulative Savings

( 144,303 )

264,980

643,671

997,123

1,329,513

1,329,513








Return On Investment (ROI)

23.05 %





Notes: The payback period is 2 years










Notes:

1.

Daily call volume per day 2280

Working day per year

250

Average reduce cost process per call $ 3

“For Example, Group Health, a nonprofit health insurance company based in New
York City”.

a.

Assume a 5% call increase per year

b.

“On average, the cost of handling a customer over the phone is $6 per call.
An effi
cient application that cost to about $3. Good email applications
trim the cost even further to $1.”

Baby Steps: With CRM efforts still in their infancy, companies await ROI
metrics, CIO.com, June 13, 2001

2.

Ongoing maintenance and enhancement costs will be 1
5 to 20 percent of the
initial project cost; license costs as a percentage of TOC are conservatively
estimated to be only 8 percent for the first five years.

3.

Ongoing maintenance and enhancement cost which includes annual maintenance,
upgrades, training, an
d change management cost.


\










IS483 RFP

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27

Reference
s
:


1.


Niles, Richard, Manager of Managed Care and Provider Systems at BlueCross
BlueShield of IL, 03/03/2003, HCSC Corporate Office 300 E. Randolph in Mr.
Nilles’ office, Discussed RFP process and Organization
al IT decision making
process

2.

Annoymous, Health Care Service Corporation Company Capsule,
http://www.hoovers.com/co/capsule/4/0,2163,48004,00.html
, 03/09/2003,
Hoover’s Online

3.

Annoym
ous, White paper, “Analyzing Total Cost of Ownership to Identify
Hidden Costs of ‘Free’ and Heavily Discounted CRM Applications”, May 2002

http://www.siebel.com/products/wh
itepapers/con_wp_hiddencosts.shtm


4.

Annoymous, White paper, “Siebel 7: Delivering the Best CRM Solution at the
Lowest Total Cost of Ownership”, March 2002

http://www.siebel.com/downloads/products/siebel7/pdf/siebel_satmetrix_whitepa
per.pdf


5.

http://www.siebel.com/products/service/call_center/index.shtm


6.

Susannah Patton, “Get the
CRM You Need at the Price You Want” May 1, 2002
Issue of CIO Magazine

http://www.cio.com/archive/050102/crm.html

7.

Annoymous, CIO Research Reports “ CRM: Are companies buying it?” Jan 07,
2002

http://www2.cio.com/research/surveyreport.cfm?id=21

8.

Annoymous, CIO Research Reports “ Best Practices for CRM” Nov 04, 2002

h
ttp://www2.cio.com/research/surveyreport.cfm?id=47

9.

Annoymous, Siebel Systems, Inc. (SEBL)

Q3 2002 Earnings Conference Call ; October 17,2002

www.CCNsource.com