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HomeMy WebLinkAbout12/05/1995, C-3 - COMPUTER WORKSTATION PURCHASING GUIDELINES {IIN�I�NIIUIIIIIIIiI IuIU "J r MEETING OATS: lii�u►I c� o san �U�s oB�spo 1�-S-9s COUNCIL AGENDA REPORT ITEM fyy1M FROM: Bill Statler, Director of Finance oaS— SUBJECT: COMPUTER WORKSTATION PURCHASING GUIDELINES CAO RECOMMENDATION Approve the use of cooperative purchasing through the State of California for computer workstations. DISCUSSION Overview The City heavily depends upon information technology in delivering City services - and this dependence will only continue to grow over time. Accordingly, it is essential that the City purchase reliable computer workstations. Given our limited resources, it is also important that we use a simple and straightforward purchasing process in doing this that assures us of reasonable and fair pricing. As discussed in greater detail below, we believe that cooperative purchasing through the State of California's "multiple award schedule" program (CHAS) will meet our needs for highly reliable workstations and a simple but fair purchasing system. Background The City currently has over 200 individual workstations connected to one of our six local area networks, which in turn are connected into a wide area network that integrates these individual LAN's into an organization-wide system. Under our adopted guidelines of replacing workstations about every three to four years in order to ensure that we do not fall too far behind current technology, we can expect to replace about 70 workstations annually (including special purpose work stations as well as those that are not part of a local area network such as those at the golf course, water treatment plant, and Whale Rock reservoir). This represents a significant ongoing investment in our information technology infrastructure of about $150,000 annually. In the past, we have tried a number of purchasing strategies, ranging from a totally decentralized system where purchases were made on a workstation-by-workstation basis (resulting in less favorable pricing than we probably could have received if we had consolidated departmental purchases while also leading to inconsistent purchases from a quality and standard configuration perspective) to a more recent "vendor certification" program where selected local vendors were "pre-qualified" to sell us computers based on a standard, agreed upon configuration, but we still solicited competitive proposals on a case-by-case basis within these parameters. For a variety of reasons, none of our past approaches were wholly satisfactory in assuring that we were receiving quality, reliable workstations at competitive prices. In March of 1995, the CAO approved a pilot program using the State of California cooperative purchasing program to purchase computer workstations. Under the CMAS program, a number of nationally distributed brands with a reputation for quality, reliability and performance (such as IBM, Hewlett Packard, NEC, Digital. AT&T and Dell) are available for purchase by local governments at catalog prices negotiated by the c- a-� ��'i���iiililllllllV�►�iu�uil�l����l city of san _ ii s oBi spo _ AgovZo COUNCIL AGENDA REPORT state and federal governments based on their substantial purchasing volumes. Based on a review of pricing options, we have been purchasing Dell computers under the CMAS program. After eight months of experience with this program in general (and with Dell computers in particular), it is time to review the results of this pilot program and to establish an ongoing approach for computer workstation purchases. Workstation Goals and Purchasing Guidelines As discussed briefly above, it is our goal to establish workstation purchasing standards and procedures that will provide us with highly reliable workstations that can be administered in a simple, cost- effective way. In doing this, we need to review two key issues: standards and purchasing procedures. Setting unrestrictive standards How can we set computer standards in such a way that they assure us of reliability and performance but avoid specifying a brand name that would result in a purchasing process that is too restrictive? This is a very difficult thing to do. To assess how other local agencies handle this, we recently met with representatives from Cal Poly, San Luis Coastal Unified School District, and the County. What emerged from this discussion was a general consensus that creating "open" specifications that will assure highly reliable computers is extremely difficult, primarily due to ever changing improvements in technology. The best example is Cal Poly, which devoted six months of highly talented staff and faculty resources to doing this. While at the end of this period they had arrived at a consensus specification that would have allowed for open competition, it was no longer valid due to changes in the technology market: they would have purchased a technologically outdated product at an uncompetitive price. At this time, Cal Poly does not have an organization-wide standard: each department sets its own standards, and based on their circumstances, uses informal bidding, CMAS, or competitive bidding as determined by Cal Poly's Purchasing Agent. The school district has resolved this problem - after a more "open" but unsuccessful bidding process - by specifying Hewlett Packard personal computers. This does not mean a "sole source" purchase - there are a number of retail sources for HP computer products; but it does mean that all of the retailers are bidding on the same thing. The County has also resolved this dilemma by using brand names, but they will consider three brands under their "enterprise-wide" concept (all workstations should perform well in all of their office environments to ensure maximum flexibility and use County-wide): IBM, Compaq, and NEC. The MIS Steering Committee has reviewed this issue for the City, and has come to the following conclusion in balancing the need for reliability without setting overly-restrictive specifications: reliability can best be assured by purchasing nationally distributed brands with a reputation for quality, reliability and performance. However, even this standard has a number of ambiguities: what does it mean to be nationally distributed - if a small Fresno personal computer assembly company mailed two workstations to a customer in Nevada, would this qualify them as "national distributer"? And who will be the final arbiter of which firms have a sufficient "reputation for quality, reliability and performance?" Fortunately, as discussed below, cooperative purchasing provides a way of resolving this standard-setting dilemma. ,�h�'�►�ii��iil!IIIIII1° ��IIII MY Of Sar, ais OBISPO Maros COUNCIL AGENDA REPORT Purchasing procedures If we could develop generic standards that would meet our needs, what process could we use to purchase them? As discussed above, even if fairly restrictive name brands are used, there are a broad range of sources for them that can be competitively bid. Assuming we could develop an effective computer specification, there are at least two basic approaches we could take: ■ City purchasing process. We could re-institute the vendor certification program (or something similar to it) and purchase on an as-needed, case-by-case basis, While this might get us the quality we want, we would be diluting our purchasing power by not having an ongoing vendor relationship. This would probably result in higher prices than we could probably get under a master purchasing agreement, which is the other option that would be available to us: to develop an RFP package for all of our purchases over a certain period of time (one to three years). While this would probably result in better pricing than the vendor certification program, it is would not be a simple process, and it pre-supposes that we would actually be able to develop a generic - yet effective - specification. And even if we could do this, would we receive better pricing than that provided to larger volume buyers - such as the County or State - if these same terms could be offered to us? ■ Cooperative purchasing. There are a broad variety of cooperative purchasing options available to us. Cooperative purchasing is not only permitted under our purchasing ordinance, but expanding our use of it was a Council goal for 1993-95, and continuing our efforts in this area is a key program objective for 1995-97. We have made extensive use of this approach in recent years, including using cooperative purchasing with the County for office supplies, the CMAS program for copiers, and State contracts for telephone service and automobile purchases. Cooperative purchasing options for computers exist through the County, the CMAS program, the League of California Cities, and the schools. In reviewing the pricing through these programs, many of them are exactly the same due to "piggybacking" arrangements where the pricing made available by a vendor through one agreement is offered to other local agencies. Recommended Approach In reviewing the various programs, we believe the CMAS program offers distinct advantages due to the wide variety of quality products that are offered. As noted above, products manufactured by IBM, Compaq, Hewlett Packard, AT&T, Digital, NEC and Dell are available through the CMAS program. In taking this approach, we meet our triple goals of assuring reliable workstations at a competitive price while keeping administrative costs to a minimum. Because of the variety of quality workstations available to us under the CMAS program, we do not recommend specifying a particular brand name, but rather, that we purchase the lowest cost workstation available to us under this program that meets our minimum workstation configuration, ������i►i►Vlllllllllp ���lll city O, San Lacs OBispO COUNCIL AGENDA REPORT standard. Under this guideline, we will be purchasing Dell's at this time based on the following cost summary for our current minimum workstation configuration standard as described in Exhibit A: Manufacturer CMAS Price AT&T* $2,849 Compaq 3,165 Dell 2,183 Digital 3,245 Hewlett Packard 3,532 IBM 2,643 NEC* 2,661 not "plug & play"compatible in accordance with City standards but listed for information purposes Experience with Dell Under the CMAS program, Dell's are purchased at a 9% discount from their catalog list price. As reflected above, this is a very cost-effective approach to purchasing workstations. For example, for every two Compaq's we might buy we can purchase three Dell's. Since we started the Dell pilot program, we have purchased about 60 workstations. While this is probably too short a time and too few workstations upon which to make any definitive assessments, our support and maintenance experience to date has been very favorable summarized as follows: Support services. We have had only four problems with Dell workstations since March: ■ One workstation had problems during shipping, and Dell sent us a replacement workstation two days later. ■ Two other workstations developed problems after they were installed. After conferring with Dell customer service staff over their "telephone" support line, in both cases they and our technical staff were able to determine the problem (a faulty motherboard), and again Dell had replacement parts to us within two working days. ■ We are currently experiencing a memory expansion problem with one of our graphics workstations. While this is unresolved at this time, we expect a satisfactory solution in the very near future (either replacement of the motherboard or new memory simms). Since Dell is a mail-order operation, we were initially very concerned about their service and support when problems might arise. This has not been a problem to-date. In fact, problems have been promptly resolved, and we have probably received replacement units/parts much quicker than if we C- 3- ���H�►�NiIu►IIIIIUI�u ��Ul City Of Sal , LUiS OBISpO COUNCIL AGENDA REPORT were purchasing from a storefont operation. One other concern is delivery turnaround - it takes about six weeks to receive a new order from Dell. However, it appears that this turn-around time is common for storefront operations as well when a particular configuration is being purchased. Maintenance issues. Because of the way Dell's are designed with an integrated motherboard and easy access to the internal parts, the Dell's have proven to be easy to maintain and reconfigure by the technical staff when necessary. In summary, our experience - while limited to eight months and 60 computers - has been positive: there have been few problems, and those we have had were quickly resolved by Dell. They are easy for the technical staff to work on and support; they are well-designed and well-made. Disadvantages of this Approach The primary disadvantage of cooperative purchasing through the CMAS program in general - and purchasing Dell's in particular - is that these purchases are not made locally. Except for Dell - which is a mail order system - the other computers purchased under the CMAS program are made through MicroAge Computers in Sacramento. In should be noted that we could probably purchase many of these brands (such as IBM, Compaq and HP) locally through other cooperative purchasing approaches (County and school programs), but the cost is likely to be significantly higher than purchasing Dell's, perhaps as much as $70,000 per year based on the volumes and costs discussed above. On the other hand, IBM, Compaq and HP are quality manufacturers, and they would certainly meet our reliability and performance standards. Again, it is important to stress that our recommendation is not to purchase Dell's per se, but to purchase computers through the State cooperative purchasing program, and within this context, to purchase those that are the most competitively priced that meet our minimum configuration standards. This just happens to be Dell at this time - it may very well be another manufacturer at some future point in time. CONCURRENCES The MIS Steering Committee and the System Administrators Group concur with this recommendation. ALTERNATIVES ■ Return to a decentralized purchasing approach. This option minimizes our purchasing power and substantially increases the possibility of purchasing workstations that do not meet our minimum standards. Further, this is an area where greater centralization - not decentralization - was recommended in the information technology master plan. ■ Conduct our own master purchasing contract process. Under this option, we would prepare an RFP for a master purchasing agreement. However, this would require significant staff resources to do, and it is highly unlikely that it would result in prices that are more competitive than those being offered to other governmental agencies who purchase much larger volumes of computers than we do. �'-3- city of san -ais oBispo Wani COUNCIL AGENDA REPORT ■ Use cooperative agreements that are more likely to result in buying from a local vendor. As discussed above, we believe that this is a viable option that will result in purchasing highly reliable workstations at a price equal to or better than we could secure on our own. As such, if the Council is concerned about the possibility that we may not be making computer purchases locally, we would recommend this alternative. However, this may result in higher overall costs - at least at the near term - than purchasing computers through the CMAS program. SUMMARY In order to ensure that we purchase highly reliable workstations in a simple, cost-effective manner, it is recommended that we use cooperative purchasing. Of the cooperative purchasing options available to us, we recommend the CMAS program. However, there are other cooperative purchasing programs that we could use other than the CMAS program that would also meet our basic technology and purchasing goals. ATTACHMENT Current City minimum workstation configuration standard HNSGUIDE.CAA Exhibit CITY STANDARD WORKSTATION MINIMUM CONFIGURATION The following hardware requirements for the City's computer purchases are the minimal configuration. Additional features must be requested at the time of order. CPU: Intel Pentium 75 MHz Minimum, W/256K Cache RAM: 8 MB(72pin) —min 128 MB capacity BUS: ISA/PCI Local Bus, at least 2 ISA slots and 1 Local Bus slot available after all cards are installed Ports: Coml:IRQ4, UO-3F8; Com2:IRQ3, UO-2F8; LPTI:IRQ7, I/O-378 Floppy: A: 3.5" 1.44 MBdrives Hard Disk: 510MB or larger/15 ms or faster—Western Digital Caviar Controller: Local Bus Enhanced IDE 1:1 Hard/Floppy Power Supply: 200 watt or better Video: Local BUS SVGA, Capable of VESA, Non-Interlace, W/2MB Keyboard: 101 Key, With tactile feel Case: Desktop or Medium tower with three 5.25" and two 3.5" bays Network Card: 3COM ETHERLINK III/tp PCI- Set at IRQ10, 1/0-300h Monitor: Color 15", VESA compliant, <28MM dot pitch, Capable of non-interlaced 1024068 display, 72Mhz refresh rate, Non-glare screen, MPR-II complient. OS: MS-DOS 6.22 or newer,.Windows for Workgroups 3.11 or newer All computers must include 3 yr warranty and be plug and play compatible 301-1 C-3- 7