New research by IT software provider, Advanced Business Solutions, in partnership with iGov Survey, has revealed almost 50% of public sector organisations still rely on time consuming and unreliable data processing methods to plan their budgets and forecast spend. More than 300 senior finance professionals took part in the poll.
The survey gauged how the wider public sector, including police, fire and ambulance authorities, as well as NHS trusts, local authorities, further education establishments and universities, responded strategically to budgetary pressures and how many were using IT to deliver results more effectively.
In spite of having access to more sophisticated software alternatives, almost half (42%) say they still rely on Excel spreadsheets for their budget preparation, monitoring and forecasting. The research also revealed 49% of respondents spent between three and six months a year on budgeting activity, with 13% spending between six to nine months on the process.
Despite these results, 82% of respondents said they believed their existing budgeting and forecasting methods allowed them to respond effectively and in a timely manner to on-going changes in their budgets. This indicates a real lack of awareness about more efficient, alternative systems available to the public sector.
The research does, however, suggest senior finance professionals are beginning to look to IT innovation to drive efficiency, with more than half (51%) saying their organisation was planning to review budgeting and forecasting processes in the next year.
A separate survey of CFOs by business analyst firm, Gartner, saw 43% of finance chiefs saying they had plans to invest in budgeting, planning and forecasting solutions in 2014.
The research also highlighted 62% of respondents describe a reduced reliance on spreadsheet working as ‘important’ or ‘very important’, suggesting the days of the Excel approach are finite.
A sizeable 87% said there was a ‘medium to high importance’ around giving budget holders greater control over their finances, and 66% believe greater financial visibility was either ‘important’ or ‘very important going forward’.
According to Dean Dickinson, Managing Director at Advanced Business Solutions: “With 46% of survey respondents admitting that cuts in the last three years have ‘significantly’ affected their organisation it is surprising that implementing better technology to deliver budget savings has not yet been widespread. There are examples of local authorities making substantial savings following the adoption of new IT solutions and so reducing budget setting timescales from months to just days.”
Cheshire West and Chester Council announced a £1 million budget saving after investing in a real-time budgeting and forecasting solution.