Smarter Federal Spending with Data Analytics

16 Aug

Smarter Federal Spending with Data Analytics

There are many discussions about how the Federal government can spend “smarter.” As we approach the much anticipated end-of-the-year spending spree, a known practice in the last quarter of the Federal fiscal year, it is important to review the practices, tools, and technologies that can lead to more effective allocation of budgets, and subsequently, better execution of mission goals.

A study from Harvard researchers published last year concluded that expiring budgets lead to lesser accomplishment of long-term goals, and in some cases, wasteful spending. So how can agency leaders successfully prioritize high-value projects over short-term spending targets?

System Overhauls Replaced by Modular Solutions

The first step in building financial accountability is identifying trends in spending. It’s difficult to track impact and return on investment (ROI) with traditional data input tools that lack an analytics component. At the same time, analysis of big data trends in budget allocation, procurement tendencies, and contracts can help government officers make wiser spending decisions. Using visualization of key data points to optimize CapEx and OpEx spending as it relates to performance can help agencies better allocate resources to capture higher ROI on projects.

User-friendly Solutions Can Help Augment Government Staff’s Financial Proficiency

Often, top-down approaches that aims to force the adoption of a financial management or a reporting tool don’t work. Any directive that impacts the day-to-day workflow of employees and requires them to spend significant time in training is bound to generate a lot of push back.

For most users, financial management programs can be inherently complex. When it comes to budget planning and optimization, the quality of the data input is critical. If government employees don’t have access to convenient, intuitive, and easy-to-use tools, the likelihood of reporting errors increases dramatically.

Similarly, the consistency of program reporting is largely dependent on user input. Workflow solutions that propel greater adoption and active user engagement can have a significant positive impact on financial forecasting, management, and reporting.

In many ways, these recommendations only scratch the surface of what is currently possible and what will be possible if analytics tools trickle down and become standard in government offices. Once the technology is adopted even in the smallest businesses and by the most novice users, budgeting decisions can be much more strategic and data-informed.

Laurel Fielding is part of the GovLoop Featured Blogger program. This blog first appeared on GovLoop.com.