How to manage agency budgets in real time

Here are three steps for moving from static spreadsheets to truly dynamic tools that support decision-making and mission analysis.

abstract image of money

To the general public, federal agency budgets answer one question: Did spending go up or down?

But for agency chief financial officers, budget directors and finance departments, budgets represent answers to a million mission-critical questions, and those answers are constantly evolving.

The complexity of agency budgets is stunning in scope, and the challenge to formulate, track and measure them is even more difficult. The process is expected to accomplish many goals -- from specifying strategic objectives to assessing program performance to delivering analysis-based reports on spending.

For such a complex job, many agencies are still using tools from the Stone Age. Spreadsheets are not equipped to manage billion-dollar budgets with thousands of dynamic line items. The result is a budget formulation process that is time-consuming, error-prone and expensive.

The time has come to stop viewing budgets as static snapshots from an accounting perspective and treat them as the living, breathing, strategic initiatives they are. Through simple upgrades to technology and processes, agency finance teams can evolve as their budgets do and focus their time and energy on making strategic mission decisions based on more accurate, timely data.

Here are three steps to doing that:

1. Maintain one version of the truth.

One of the most common issues plaguing budget offices is the disconnect between the numbers used to brief agency or administration leaders and the numbers used in official budget documents.

There are a couple reasons for that. First, agencies often track budgets by department, which means many silos of information represented by many documents. Second, there is a need for version control, which requires a tremendous amount of communication and collaboration. Many agencies rely on spreadsheets that are great for tracking static numbers, but when line items are constantly updated across various internal teams and those changes aren't replicated, it's impossible to maintain accurate, agencywide data.

The key is breaking down those silos and empowering finance personnel to collaborate and make changes in real time. Automation and analytics have transformed nearly every aspect of agency operations, and budget formulation should be no different. Software can maintain a single, authoritative view of the truth, with the ability to seamlessly roll up and drill down into numbers and make information instantly usable across departments.

2. Bring budget formulation and strategic planning under one roof.

When an agency delivers its budget for review -- to Congress, agency leaders or the president -- every single cent must be accounted for. That means every single line item must have a return-on-investment narrative on why programs are being funded, the desired goal and whether it is being attained. Agencies need an efficient way to tie budget formulation to strategic planning initiatives.

This is not something that spreadsheets are good at. Lack of integration between budget documents and strategic plans inevitably results in undocumented differences between funding and results. The process of manual integration and report creation wastes valuable time, results in inaccuracies and makes it impossible to identify key performance trends over time.

The future of federal budget formulation must move past the goal of merely knowing how much money was spent. Agencies need the ability to bring budget reporting and strategic planning together to simplify reporting and, more important, make better decisions for the future of the mission.

3. Let your people be knowledge workers, not data entry specialists.

Would you rather have budget professionals manually entering data or analyzing it?

For budget experts to be most effective, they need time to focus on key strategic analysis to quickly make important, informed decisions. Changes can happen at any point in the budget process, and those related to funding levels or spending narratives seem to occur at the last minute, leaving little time to update budgets.

Those issues can be addressed by automation. For example, short-term continuing resolutions require repeated, rules-based creation of financial operating plans. Why go through the pain of creating new plans each time when you can have the latest version of the truth on file and ready to go at a moment’s notice?

Likewise, why manually update budget tables and narratives when technology allows for automated updates in real time? With a budget that has been brought to life, changes automatically propagate throughout the document defined by rules that you customize ahead of time.

The budget formulation process is becoming more complex, and at the same time, budget scrutiny is increasing. Automation and analytics can help agency finance teams rise to the challenge and focus their energy on mission analysis, not data entry.

X
This website uses cookies to enhance user experience and to analyze performance and traffic on our website. We also share information about your use of our site with our social media, advertising and analytics partners. Learn More / Do Not Sell My Personal Information
Accept Cookies
X
Cookie Preferences Cookie List

Do Not Sell My Personal Information

When you visit our website, we store cookies on your browser to collect information. The information collected might relate to you, your preferences or your device, and is mostly used to make the site work as you expect it to and to provide a more personalized web experience. However, you can choose not to allow certain types of cookies, which may impact your experience of the site and the services we are able to offer. Click on the different category headings to find out more and change our default settings according to your preference. You cannot opt-out of our First Party Strictly Necessary Cookies as they are deployed in order to ensure the proper functioning of our website (such as prompting the cookie banner and remembering your settings, to log into your account, to redirect you when you log out, etc.). For more information about the First and Third Party Cookies used please follow this link.

Allow All Cookies

Manage Consent Preferences

Strictly Necessary Cookies - Always Active

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data, Targeting & Social Media Cookies

Under the California Consumer Privacy Act, you have the right to opt-out of the sale of your personal information to third parties. These cookies collect information for analytics and to personalize your experience with targeted ads. You may exercise your right to opt out of the sale of personal information by using this toggle switch. If you opt out we will not be able to offer you personalised ads and will not hand over your personal information to any third parties. Additionally, you may contact our legal department for further clarification about your rights as a California consumer by using this Exercise My Rights link

If you have enabled privacy controls on your browser (such as a plugin), we have to take that as a valid request to opt-out. Therefore we would not be able to track your activity through the web. This may affect our ability to personalize ads according to your preferences.

Targeting cookies may be set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant adverts on other sites. They do not store directly personal information, but are based on uniquely identifying your browser and internet device. If you do not allow these cookies, you will experience less targeted advertising.

Social media cookies are set by a range of social media services that we have added to the site to enable you to share our content with your friends and networks. They are capable of tracking your browser across other sites and building up a profile of your interests. This may impact the content and messages you see on other websites you visit. If you do not allow these cookies you may not be able to use or see these sharing tools.

If you want to opt out of all of our lead reports and lists, please submit a privacy request at our Do Not Sell page.

Save Settings
Cookie Preferences Cookie List

Cookie List

A cookie is a small piece of data (text file) that a website – when visited by a user – asks your browser to store on your device in order to remember information about you, such as your language preference or login information. Those cookies are set by us and called first-party cookies. We also use third-party cookies – which are cookies from a domain different than the domain of the website you are visiting – for our advertising and marketing efforts. More specifically, we use cookies and other tracking technologies for the following purposes:

Strictly Necessary Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Functional Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Performance Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Social Media Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Targeting Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.