Discover how Microsoft can help treasury agencies drive outcome-based budgeting
Budget and treasury agencies, and the people who lead them, are tasked with tackling a myriad of challenges while simultaneously navigating various macro-economic situations. At a minimum, they are responsible for public spending, financial services policy, strategic oversight of revenue collection systems, and funding vital infrastructure projects. In doing so, these agencies ensure the efficient use of public funds and sustainable economic growth, while securing public trust in the government’s ability to manage the financial shape of their nation.
Society demands more from government today than ever before. Gone are the days where government budgets could be set without transparently connecting taxpayer money directly to tangible outcomes. Today, traditional “analog” government structures that permit departments and services to operate in silos are understandably challenged by citizens, agency employees, and businesses alike.
So how can budget and treasury agencies meet these desired outcomes, enable real-time public services, and provide measurable social and economic outcomes? With innovative technology that enables outcomes-based budgeting, leading to more accountability and increased cross-agency effectiveness.
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Outcomes-based budgeting allows agencies to track progress to jurisdictional outcomes that would have been near impossible in the past. It also empowers agency employees with innovative and secure tools that cater to desired government investments and fosters financial inclusion.
In figure 1 below, each box represents one of the outcomes agencies strive to achieve. The colors reflect the type of technology required to provide the financial foresight to measure these outcomes. For example, agencies are looking to improve the skills of the workforce to get better jobs in the future. To deliver on and measure this outcome, they need technology to improve collaboration and knowledge sharing, like Microsoft 365 and Microsoft Viva Learning. Similarly, to deliver on the business outcome of making trade easier both in-country and abroad, agencies need technology for both digital payments management, Microsoft Azure, and collaboration and knowledge sharing, like Microsoft 365.
This vision of outcomes-based budgeting and financial foresight hinges on three pillars of transformation for budget and treasury agencies:
- Become predictive, connected and agile: An expanded impact through strategic foresight capabilities that allows treasury departments to cope with increasing volatility of interconnected global socioeconomic ecosystems and influence broader policy.
- Be a trusted and transparent government advisor: Shift in focus to proactively build trust and transparency and to empower near-real time policy advising.
- Foster financial inclusion, innovation, and resilience: Enable an evolving landscape of financial innovations to facilitate financial inclusion and resilience for agencies and countries as a whole.
To facilitate such transformation, budget and treasury agencies need to consider four main technology areas:
- Modern budget planning: Enhanced budget forecasting capabilities and process automation that’s agile, real-time, and intelligent to enable immediate and actionable budgetary execution, reporting, and compliance management.
- Accountable treasury management: Highly transparent, nimble, and intelligent management systems that automatically manage the liquidity of national assets, debts, reserves, and investments.
- Targeted grants management: Streamlined grants programs that are aligned to national investment objectives, with shorter and more transparent approval procedures to facilitate the efficient disbursement of grant cases. In addition, the ability to generate reports on the impact of disbursements to national objectives such as gross domestic product (GDP) growth and jobs creation, for instance.
- Sustainable public procurement: Compliant and highly transparent digital procurement platforms that can easily allow automated IT or financial audits to occur at any point in time. Furthermore, the agility to integrate new policies and regulations into the procurement process that’s aligned with national agendas, such as environmental, social, and corporate governance (ESG) goals or the various trade agreements.
City of Columbus elevates budget planning and streamlines budgeting processes
The City of Columbus is a prime example of a government budget and treasury agency who harnessed the power of technology to streamline processes, empower employees, and embrace the above tenants of outcome-based budgeting. As the capital of Ohio and the 14 largest city in the United States, the city strives to meet the challenges of their modern, growing city, including for government budgeting and accounting. For a city, the level of scrutiny on every dollar collected and every dollar spent is high. They understood that, as mentioned above, financial planning, budgeting, and accounting need to be fully transparent and traceable.
They partnered with Microsoft to adopt a solution based on Dynamics 365 Finance, and using elements of Dynamics 365 Supply Chain Management, commerce applications and Microsoft Power Platform. Currently, the city maintains over 150 budget plans and 9,000 forecast positions, and more than 3,500 grants and capital projects. Many of these processes use workflows with multiple levels of approval, adding to the complexity.
With Microsoft Dynamics 365, the city can easily and flexibly maintain, manage, and adjust those process flows as their needs change. In a short amount of time, the City of Columbus has been able to recognize some of the expected results with Dynamics 365, including a reduction of more than 10 percent in budget planning effort and increased productivity for remote employees.
- Less effort for better budget planning: With Dynamics 365 the city has enhanced the budgeting process for around 60 users engaged in budget planning. The intuitive, easy-to-use interface looks and feels like Microsoft Excel, and has allowed users to reduce time and effort spent on budget modeling and maintenance. With up-to-date budget information, a set of Microsoft Power BI reports with views of budget data are used to review and validate budgets as the team moves through the budget cycle.
- Increased productivity for remote employees: Employees can access the system from anywhere, without VPN, increasing productivity and strengthening disaster recovery. These capabilities were tried and tested during COVID-19, as lockdowns took hold and city employees were forced to work from home. The ability to access and interact with systems just like they do at the office helped the city remain productive and continue to service the needs of Columbus residents.
Utilizing technology to build long-term financial resilience
As treasuries face new challenges and their priorities shift towards tackling current and future crises, the government has a unique opportunity to demonstrate how they leverage new technologies to build long-term financial resilience and inclusion, empower employees, and enable sustainability. This requires efficient internal processes that can be automated easily to free time and effort for other priorities, like inclusion and sustainability. Microsoft solutions like Dynamics 365 Finance and Microsoft Power Platform can be leveraged to achieve operational excellence and provide low-code tools for automation. We partner with organizations worldwide to utilize the insights of these learnings and harness the power of data-driven services and cooperation to build a better future for everyone.
To learn more about how the City of Columbus harnessed technology to transform finance processes and how Microsoft can help empower treasury agencies to drive outcome-based budgeting, visit Microsoft in Public Finance.
