State administration outlines plan to centralize procurement and HR to cut duplication and improve service

Misty Ann Giles, director of the Department of Administration, told a legislative subcommittee the department is pursuing enterprise centralization for procurement, human resources and information technology to reduce duplication, improve service and generate cost savings. “We're here to talk about the centralizations for procurement, human resources, and IT,” she said during the presentation.

Giles said DOA administers statewide contracting authority under the Montana Procurement Act (Title 18) and currently reviews procurements above typical agency delegated limits. She told the committee DOA manages roughly $5,000,000,000 in contracts annually while directly staffing a comparatively small procurement team, and that centralization will let the state bundle duplicated contracts and negotiate better enterprise pricing.

The director described a layered service model: agencies will retain day-to-day purchasing responsibility for routine commodities while DOA will handle strategic sourcing, sole-source approvals and complex procurements. For high-activity agencies such as Health and Human Services, DOA plans a dedicated “practice area” so agency-specific complexity is managed by subject-matter experts working in partnership with DOA staff.

DOA also previewed operational changes: an electronic procurement workflow to replace paper-based approvals and a set of KPIs that will track cycle time, customer satisfaction and other service standards. Giles said the program will surface duplicated contracts and that strategic sourcing moves in other states have produced multi‑million-dollar savings: "we picked up the phone, brought them in... and for 14,000, saved 1,000,000 bucks," she said, describing a consolidated contract example.

Committee members pressed for measurable targets and an impartial way to verify net savings across the executive branch. Giles acknowledged current contract inventories are maintained in spreadsheets, and said the new system will enable enterprise KPIs this fall; she recommended a retrospective audit or review during the next interim to confirm results.

The committee also questioned whether centralization will slow time‑sensitive grant or rural health procurements. A DPHHS representative said the department has coordinated with DOA and does not expect centralization to impede program timelines for initiatives such as the Rural Health Transformation Program. Giles added that certain items — for example, emergency contracting in child protection or military affairs — are being excluded from centralization where law or mission requires agency control.

The presentation closed with DOA offering to publish materials and make staff available: Giles said the department has an online centralization portal with FAQs and that members can request data or further briefings as the rollout proceeds. The committee did not take formal action at the hearing; members asked that the administration provide fall KPI data and consider placing an independent verification of savings on a legislative work plan.