The State does not routinely perform agency or statewide strategic planning or performance budgeting processes, thereby depriving decision makers of data that would better inform the budget decisions affecting the allocation of scarce State resources.
An assessment of the State’s banking needs has not been conducted in more than 25 years. As a result it is unknown whether the State’s needs are being met or whether it is receiving the best value for the services currently utilized.
Delaware State Agencies have traditionally operated with significant autonomy. As a result, many administrative and financial service functions are duplicated statewide, resulting in unnecessary expenditures for employee and contractor time, software licenses, and computing service costs. Financial services which have not been benchmarked against in-kind internal processes, or equivalent private sector processes, are unable to assert they operate with optimal effectiveness and/or at the lowest cost point.
With a new administration, and new budgeting system, the time and environment are right to reinstitute strategic planning and performance budgeting. Strategic planning is a disciplined effort to produce fundamental decisions and actions that shape and guide what an organization/entity does, why it does it and creates a view of, and set of actions planned for the future. Performance budgeting enables budget decisions to be made about the allocation of limited resources based on the performance of services delivered. Decision makers are provided with better information about the achievements or failures of programs and policies — thereby shifting the terms of debate from inputs, to outcomes and results. With these two processes reinstituted, OMB will be able to take key information from agency strategic plans and develop a performance dashboard. This information will then be used to evaluate resource requests in the context of actual achievements, and thereby allow the preparation of data-driven budget recommendations for gubernatorial and legislative consideration.
The State will reduce overall financial process complexity and total cost of operation (TCO) by adopting an enterprise financial services delivery model for selected financial functions common to multiple Agencies.
A study must be undertaken to identify: operational efficiencies, unused and/or underutilized services, value for fees paid, fraud prevention and control, future banking needs, the service delivery approach of each banking partner, the use of banking network by the State, and data integration and efficiency.
In the effort to improve budget-related processes, the Financial Services program will seek to reinstitute strategic planning and performance budgeting with the intent to use outcome data to make budget decisions about the allocation of limited resources.
The program will create legislation to support continuing the authorization for the Office of Management and Budget (OMB) — in consultation with the co-chairs of the Joint Finance Committee — to sweep Special Fund balances into the General Fund as a measure to both control agency expenditures and clear out unused and underutilized appropriated balances for further use.
The program will seek opportunities to consolidate selected Agency financial functions onto common statewide platforms. As an example, the program will identify legacy financial management systems (e.g., Quick Book applications for tracking grants or agencies using separate financial management systems) and recommend the migration of these business processes into the First State Financials (FSF) system, the statewide financial management system.
The Financial Services Delivery program will encourage Agencies to identify opportunities for process improvement in an effort to eliminate bottlenecks currently slowing transaction approvals, reimbursements and related business processes. By documenting and improving critical processes, financial transparency will be improved such that the public will be able to more easily observe and understand how their tax dollars are spent.
Finally, the program team will:
The reinstitution of strategic planning and performance budgeting processes will enable data-driven, fact-based policy and budget decision making. From better information will come better decisions about the allocation of scarce State fiscal resources to programs and projects, which in turn will ensure goods and services are delivered to Delaware’s citizens efficiently and effectively.
At the conclusion of the program, State agencies will agree to use a smaller set of financial services processes, which are well documented, and whose efficiency is measured by the use of well-defined operational metrics. The processes will reside mainly within the FSF and related enterprise systems, as all legacy, in-kind, IT systems will have been withdrawn. Small to medium sized agencies, after having eliminated internally managed financial services better suited for operation as a shared service, will recognize a proportionally higher operational cost savings.
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