The need for analytics in government agencies and across the public sector should be obvious. Ensuring efficient delivery of the full spectrum of social services and appropriate use of tax revenue at every level from city to nation is critical to establish public confidence and trust. In reality, however, most governmental entities are not meeting that level of expectations. In the U.S. (and likely elsewhere) agencies struggle with the simple tasks of having clarity in spend projections and aligning them to operating budgets.

At the city and county levels, governments have limited budget resources akin to those of small businesses, and those at the provincial or state level face similar challenges on a larger scale. The various departments have to share IT resources for a range of tasks, including data and reporting, that limit the analytic competencies available for use on budgeting and other accounting activities. This situation leaves cities and counties on their own to figure out how to improve efficiency, usually through analyzing their constituents' use of services and determining where they are underserving or overserving based on their hours of operations.

The independent yet overlapping relationships of cities and counties cost taxpayers large amounts of money and time lost through duplication of efforts, and this is true of tasks to produce and refine analytics. It would make sense for the two levels to share resources to meet common needs, and software now can be rented through software as a service (SaaS), where the IT infrastructure is managed by a third party in a cloud computing environment. This delivery method not only alleviates the need for in-house IT to install, configure and maintain a system but also significantly reduces the risk of purchasing technology that might not be the best fit or costs more than expected in software maintenance and support. As well, IT can spend its time better to adapt the analytics software for its departments' needs, to look for shared best practices from similar entities and to establish metrics that can be used internally and even shared with constituents as public reporting or transparency requirements dictate. Having preconfigured databases in SaaS analytics and solution offerings can eliminate the need to employ and train local database administrators.

Analytics can help larger agencies at the federal level examine their fiscal responsibility through costing analysis to determine the right level of investments as related to objectives. All of the public sector can benefit from the use of spend analytics not just to ensure fiscal responsibility but also to quickly examine benchmarks of related spend to ensure they don't buy $500 hammers and $20 screws any more for governmental projects. Spend analytics can help determine the optimal investments when agencies are forced to reduce budget allocations. In the case of social services, for example, analytics can be used to examine submissions for reimbursement to align price with patient treatments and pharmaceutical prescriptions. The analytics needed to accomplish this are simple once a common set are agreed upon and applied to distributed databases across agencies.

Acquiring the right level of analytic competency is not difficult if departments and agencies across levels examine and agree on the shared resources and capacity to support the needs. Government does not have operate in ways years behind the private sector, continuing to rely on desktop spreadsheets, presentations, static reports and e-mail, as our benchmark research has indicated the public sector often does. Examining the requirements and setting priorities for improvement need not be difficult at any level if led by competent individuals. A range of improvement for managing the workforce to more efficient budgeting can be accomplished through analytics. All of what is needed can be had at affordable prices today; not taking steps to acquire the right tools risks wasting money and time at a time when public outcry about it demands accountability and efficiency.

Government also needs analytics to implement continuous financial planning on a quarterly basis, which can provide visibility into budget shortfalls and issues like those that led to economic instability at all levels of operations. If you are examining how to improve analytics in your government sector, I encourage you to participate in our latest benchmark research on analytics. I will be assessing the needs of your industry, determining where your agencies and departments can improve in providing the services and efficient use of funding the public demands. Governmental performance management cannot occur without a baseline of analytics regarding finance, the workforce and the services that you provide. What you learn from the results of this research will help drive improvement in your organization.

Mark also blogs at