$40M in cost reductions for the City of Houston

Former Houston mayor Bill White was passionate about making government more transparent to the public. And so he did. Our transparent financial dashboard software saved Houston taxpayers over $40 million in two years.

$40 million savings over two years

Summary

The Problem

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How We Helped

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The Outcomes

How we Helped

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Portal Development

Gallery

Client Review

Background

Introduce your business and what you do there.

My background is in IT, and I have worked as a government employee for 24 years. I worked within the purchasing department for the city of Houston. I was the information resource manager of the organization and was in charge of the strategic purchasing division – IT section. 

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Opportunity / Challenge

What challenge were you trying to address with Praxent?

When I started my job, paperwork was being done by hand. They were using typewriters for tabulations, letters and so on, on behalf of the city and the mayor’s office. I was able to change that, implementing a full-blown network with desktops, laptops, and Wi-Fi. In late 1999, we had the first web presence for the city of Houston.

From that point, we started posting bids and accepting online payments. Our mayor was highly impressed with the results and demanded that we take it one step further and become transparent. He felt that we didn’t have enough competing bids in order to drive prices down, so he asked my team to come up with a program that would reveal our contract processes and usage to the public.

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Solution

What was the scope of their involvement?

Praxent developed a phenomenal program for our group, which we call an online purchasing catalog. It featured the simplest and most user-friendly interface we’ve ever had. The platform has a SQL Server backend, which reads directly from our financial SAP. The interface works in real-time. Every time we issue a purchase order, the financial system reduces the amount of the purchase and it automatically reflects this in the catalog. If we were to budget 20 million dollars for janitorial or office supplies, not knowing how much we’d have to spend 6 months down the line, we could go to the catalog. It showed what the original contract was, the budgeted amount, what we had already spent, and how much we could still spend. All of this information was visible to the public. We could also drill inside the platform and see what, for how much, and from whom we made specific purchases.

The development would be done off-site but Praxent also spent time on-site, determining what would be required for a connection with our system. The programming was done using ASP.NET, JavaScript, and Ajax. Google Search Appliance was integrated for deep searches. Our IT department didn’t know how to make this integration, so Praxent was brought on site for the installation. They physically performed a lot of work on-site and off-site. Our on-site team from Praxent consisted of 3 people, and we were also in touch with 3 team members remotely. Praxent assigned a dedicated graphic designer to our project, as well as a project manager, a .NET developer, and a database administrator.

How did you come to work with Praxent?

We met with Praxent’s CEO, who made a presentation for our mayor’s office and the people from the procurement and finance departments. Their presentation showed us how the task would be accomplished. We met with 2 other companies besides Praxent, but they stood out through that presentation. We felt confident that Praxent could achieve the task within 6 months.

How much have you invested with them?

The budget was substantial. The final bill was well into the six figures for our e-catalog.

What is the status of this engagement?

We started working with Praxent around 2005 to 2006, and the electronic catalog project had a 6-month duration. The platform was implemented and installed. It’s very stable, so we hardly ever had to call Praxent. I’m sure that their company will be the first one we’ll call in the future for any additions. We gave an additional contract to Praxent later for other automation tasks.

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Results & Feedback

What evidence can you share that demonstrates the impact of the engagement? 

When the vendors found out that they’d become visible to the public, many of them threatened to sue us, the government, because they felt that those were private. Since they were behind the scenes deals, vendors thought the special pricing shouldn’t have been seen by the public. This went to our legal department, which made the decision that those were public records, which is true for any document entering the government. We didn’t go to court, but some of the vendors dropped the city. The majority did stay with us.

In fact, our e-catalog served as a tool for bringing in many more vendors wanting to beat the current prices that we had. In just the first year, that e-catalog saved the city 20 million dollars. We are continuously getting lower and lower prices because our deals are visible to the public. Anyone can look at any product and determine if they can beat the price. After the automation, the city was able to save more than 40 million dollars, if we factor in the manual labor that was no longer required. Before, we had to account for the various people involved in getting offers. We had to move them to IT, assign a programmer for the task, and get back to the mayor’s office for approval, as well as the media relations involved. The interface created Praxent, with all of its integrations, has saved the city a significant amount of money annually. We won an award from the federal agency in Washington for the successful implementation of a transparent system. Other cities have followed suit.

How did Praxent perform from a project management standpoint?

I appreciated the fact that we never had to wait on Praxent’s team. There was always a backup person available who knew what the project was about. We never had to give long explanations and we got assistance on the spot.

What did you find most impressive about them?

We’ve had bad experiences with other contractors in the past, having to leave them messages and waiting to be called back. There were usually waiting times of a few days before a deal was resolved, but Praxent’s response time was instant. Their CEO was hungry for the business, so he delivered as promised. We will always refer business to Praxent for this reason.

Are there any areas they could improve?

My only suggestion for Praxent would be that they open an office in Houston if they are to do additional business here. Our city has come up with an ordinance by which businesses which reside within its limits are given priority. If I wanted to contract Praxent, I may have a hard time doing it. The problem with this ordinance, which I’ve been fighting, is that it awarded business to local companies that could have prices up to 3% higher. It was meant to encourage local companies to participate in government jobs, but the local vendors have been taking advantage of this. They’ve pumped up their prices by up to 3% because they know that they can stick within that range and still be chosen. This works against our interests and against those of Praxent.