TO: HONORABLE MAYOR
AND CITY COUNCIL
FROM: Emily Lam
SUBJECT: See Below DATE: June 18, 2026
Approved
Date:
6/18/2026
COUNCIL DISTRICT: Citywide
SUBJECT: Fourth Amendment to the Agreement with Guidehouse, Inc. for Organizational Change Management and Related Consulting Services
REASON FOR ADDENDUM
This memorandum has been added to the June 23, 2026, City Council meeting agenda to ensure continued Customer Experience Transformation services in July without interruption or delay.
RECOMMENDATION
Adopt a resolution authorizing the City Manager or her designee to negotiate and execute a Fourth Amendment to the Master Consulting Agreement with Guidehouse, Inc., to increase the maximum compensation by $275,800, from $3,116,900 to an amount not to exceed $3,392,700.
SUMMARY AND OUTCOME
The City continues to implement the Customer Experience (CX) Transformation as part of the multi-year effort to implement the City Council-approved Customer Service Vision and Standards. The goal of the CX Transformation is to more reliably deliver services, reduce inefficiencies, and strengthen public trust, starting with the migration of existing SJ311 services onto the new Customer Relationship Management (CRM) platform to enhance customer communications, develop key performance indicators, and streamline business processes. To support this transformational effort, the City competitively procured organizational change management (OCM) and business COUNCIL AGENDA: 6/23/26
FILE: 26-792
ITEM: 2.25
HONORABLE MAYOR AND CITY COUNCIL
June 18, 2026
Subject: Fourth Amendment to the Agreement with Guidehouse, Inc. for Organizational Change Management and Related Consulting Services
process reengineering consulting services and executed a Master Consulting Agreement with Guidehouse, Inc. in February 2025.
Guidehouse currently supports the Build Foundation phase of the City’s CX Transformation through change management, training, business process reengineering, user-centered design validation, and implementation readiness activities. Continued Guidehouse support is necessary to ensure successful CRM adoption, consistent business process alignment across departments, and advancement of a scalable, sustainable enterprise-wide CX model.
Approval of the Fourth Amendment will increase the agreement’s maximum compensation by $275,800, from $3,116,900 to an amount not to exceed $3,392,700.
This amendment will enable the City to maintain project momentum, avoid disruptions during a critical phase of implementation, and secure the organizational change management expertise necessary to support a successful CRM deployment and achieve the City’s customer service objectives.
BACKGROUND
In 2023, the City began implementing the City Council-approved Customer Service Vision and Standards and associated recommendations. A key recommendation included implementing an enterprise CRM system to improve the customer experience, enhance customer satisfaction, and provide a centralized solution for tracking and managing customer interactions across departments. The City also identified the need for external expertise to supplement limited staff resources and support both the technology implementation and organizational transformation required for successful adoption.
To support this effort, the City conducted a competitive Request for Proposal process in 2024 for OCM and related consulting services. These services support customer service process improvements, business process reengineering, stakeholder engagement, training, policy development, and organizational readiness activities necessary to achieve the City’s customer service objectives. Guidehouse, Inc. was selected through this process, and the City executed a Master Consulting Agreement with Guidehouse on February 6, 2025. The Master Agreement is used for two purposes:
general use by all City Departments, and implementation of the Soft Story Seismic Retrofit Pilot Financing Program (Pilot Program) through the Housing Department. The current maximum total compensation for general use is $1,500,000. The current maximum total compensation for the Pilot Program is $1,616,900. The increase in compensation contemplated in this amendment would only apply to work done for general use and would not increase the maximum total compensation for the Pilot
HONORABLE MAYOR AND CITY COUNCIL
June 18, 2026
Subject: Fourth Amendment to the Agreement with Guidehouse, Inc. for Organizational Change Management and Related Consulting Services
Program. The new maximum total compensation for general use under this amendment would be $1,775,800.
Guidehouse currently supports the Build Foundation phase of the City’s CX Transformation. This work includes change management and training, business process reengineering, user-centered design validation, requirements traceability, and implementation readiness activities. Continued OCM support is critical to ensuring successful adoption of the new platform, consistent business process alignment across departments, and advancement of a scalable and sustainable enterprise-wide customer experience model.
ANALYSIS
The City is undertaking a multi-year effort to implement the City Council-approved Customer Service Vision and Standards and deploy an enterprise-wide CRM system.
Successful implementation requires both technology deployment and organizational change management to ensure that new business processes, customer service practices, and technology solutions are consistently adopted across departments.
Guidehouse currently provides organizational change management, business process reengineering, training, user-centered design validation, and implementation readiness services that complement the City’s continued CRM implementation.
Guidehouse has established a strong understanding of the City's customer service objectives, stakeholder needs, and implementation approach through its work during the Build Foundation phase of the CX Transformation. Continuing these services will help maintain project continuity, avoid knowledge transfer delays, support timely decision- making, and reduce implementation risk. The proposed amendment will enable Guidehouse to continue supporting change management, training, business process improvements, and implementation readiness activities that are critical to successful CRM adoption and long-term program sustainability. Without this additional authorization, the City risks delays in key implementation activities, reduced organizational readiness, and inconsistent adoption of the CRM solution across departments.
EVALUATION AND FOLLOW-UP
No additional follow-up action with the City Council is expected at this time.
HONORABLE MAYOR AND CITY COUNCIL
June 18, 2026
Subject: Fourth Amendment to the Agreement with Guidehouse, Inc. for Organizational Change Management and Related Consulting Services
BUDGET REFERENCE
The table below identifies the fund and appropriation to fund the contract recommended as part of this memorandum and remaining project costs, including project delivery, construction, and contingency costs.
Fund # Appn. # Appropriation
Name
Total
Appropriation
Amount for
Contract*
2026-2027
Proposed
Operating Budget
Page**
Last Budget
Action (Date,
Ord. No.)
001 218T
Customer
Experience (CX)
Transformation
$3,900,000 $275,800 813 06/16/2026
09999
* Increasing the Master Consulting Agreement by $275,800 will provide the capacity to encumber funds for the remaining Service Order.
**The 2026-2027 Proposed Operating Budget was approved on June 9, 2026, and adopted on June 16, 2026, by the City Council.
COORDINATION
This memorandum was coordinated with the City Attorney’s Office, City Manager’s Budget Office, and the Planning, Building and Code Enforcement Department.
PUBLIC OUTREACH
This memorandum will be posted on the City Council Agenda website for the June 23, 2026 City Council meeting.
BOARD, COMMISSION, COMMITTEE RECOMMENDATION AND INPUT
No board, commission, or committee recommendation or input is associated with this action.
CEQA
Not a Project, File No. PP17-003, Agreements/Contracts (New or Amended) resulting in no physical changes to the environment.
HONORABLE MAYOR AND CITY COUNCIL
June 18, 2026
Subject: Fourth Amendment to the Agreement with Guidehouse, Inc. for Organizational Change Management and Related Consulting Services
PUBLIC SUBSIDY REPORTING
This item does not include a public subsidy as defined in section 53083 or 53083.1 of the California Government Code or the City’s Open Government Resolution.
Emily Lam
Director of City Manager’s Office of
Administration, Policy and
Intergovernmental Relations
For questions, please contact Nichole Ederer, Deputy Director, City Manager’s Office, at [email protected].