Connection

The Official Blog of Forecast5 Analytics

Mike English
WRITTEN BY
Mike English

Analytics, Business Intelligence, Collaboration, Local Government, Forecasting

Analytics: The Paradigm Shift in the Public Sector

Posted on Mar 30, 2013 12:00:00 AM

For the last several years, corporations have been deploying data technology on an increasing basis for the purpose of driving productivity and ultimately increasing profits.  To a great extent, however, the public sector has not been introduced to the use of analytics for financial management.  There may be several reasons for this delayed exposure…most likely, the primary factor has been cost. Budget pressures in schools, cities, and counties have forced officials to make many resource decisions.  The concept of installing an enterprise Business Intelligence (BI) platform was a low priority from three perspectives:

  1. Acquisition costs for traditional BI systems have been out of reach for most local governments
  2. Lack of available IT staffing and resources to install and maintain such systems
  3. Difficulty in justifying the expense due to lack of surety on a positive return on investment (ROI) versus other spending priorities

Learn how to arrive at a decision by building a bridge with data

Fortunately, a paradigm shift is evolving rapidly.  BI solutions are beginning to emerge that have been tailored to meet the needs of the public sector and that eliminate the previous resource barriers.  In the immediate future, local governments will begin to adopt the technology and develop a new analytical framework with respect to their financial management.  This development represents a significant opening for the public sector to be able to convert their data into financial and service opportunities.

Business Intelligence models have a tested and proven track record in the corporate sector.  Companies around the world are using analytics to increase marketing effectiveness, drive additional sales, reduce inventory costs, etc..  These proven applications of the technology are not intuitively translatable to local governments.  However, new thinking has been able to adapt and translate the power of multi-dimensional data technology for the benefit of the financial management of schools, cities, and counties.

Now… data and analytics represent a significant opportunity for local governments… a new and untapped resource within the enterprise.

As theorized, a significant roadblock in the adoption of analytics has been cost.  In most cases, without “savings” to justify the “investment”, BI platforms were simply too difficult to support given the other immediate spending priorities.  But this is changing…

  1. New cloud based solutions are available that reduce the total cost of ownership (TCO).
  2. Shared service platforms are providing economies of scale and richer data sets.
  3. Analytics designed specifically for public sector consumption are producing immediate paybacks.

These two points dramatically change the dynamics of the traditional ROI calculation.  The low cost of entry eliminates the previous acquisition risks.  And, the concept of “consumable analytics” is converting financial data into immediate, actionable insight.  This is an exciting development for local governments…a platform that is low cost and provides immediate return potential.

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Mike English is a founder and the CEO/President of Forecast5 Analytics, Inc. – a technology company focused on software development and data analytics for the public sector.  Mike has spent his entire career concentrating on the development of financial and strategic solutions for schools and municipalities.  Forecast5 is headquartered in Naperville, Illinois – a suburb 30 miles west of Chicago.

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