Improving Your Budgets Through Performance Information

Think back to when you were a kid. You had an idea and you knew it was right. The system for chores wasn’t good enough. You KNEW that if you and your sibling worked together the way YOU wanted the chores could get done easier and faster. Once you came up with a plan to convince your parents then they were much more likely to sign off as opposed to you just complaining about the current system.

Flash forward to today. Your superiors now play the role of your parents in that situation. And your siblings are your coworkers who know how to do chores differently.

So how can you all come together to make efficiency in your ideas happen? John Whitley has a plan for you.

John Whitley, Senior Fellow with the Institute for Defense Analysis, told Chris Dorobek on the DorobekINSIDER program that we need to invest in integrating performance information with the formulation of budgets. These practices are proven to help, but some agencies are hesitant to implement the process.

Dr. Whitley talked about his report titled “Four Actions to Integrate Performance Information with Budget Formulation.” In order for the budget process and performance function to work, “both communities must adapt their own processes and data products to the needs of the other,” Whitley said.

Here are Whitley’s four recommendations:

1: Engage Agency Leaders

2: Focus Attention on Conducting Better Analyses

3: Improve the Budget Formulation Process

4: Reform Agency Budget Accounts and Cost Estimating Approaches

“The challenge is, getting it started where it hasn’t, where it’s not being done currently, and continuing it where it is being done. And those can be big challenges,” said Whitley.

The top down process of having leadership be the champions of the plan, is often ideal. But frequently the upper management doesn’t know how to bring analysis into budget decisions or they have competing interests away from changing the budget process.

“We all have this vision of hierarchical government organizations with a secretary at the top who’s firmly in charge of their agency,” Whitley said, “but those of us who have worked in these organizations know that there’s a lot more nuance to that.”

Whitley reiterated how the top down support is vital even before “the lowest level is even putting pen to paper on those tables. You need policy guidance, fiscal guidance, process guidance that comes from the top down.”

Just as important as having support for performance information with budget formulation is placing skilled workers in the right positions. It requires personnel with analytic capability.

“Program management analysts are great; I’ve been one, lots of people have been one. They bring a wealth of knowledge about programs to the table,” said Whitley. “But if you’re trying to figure out how spending more money in the area is going to result in a change in mission outcomes, you might need some office research analysts, you might need some economists, you might need some statisticians. You might need people with, with natural science backgrounds in the areas in which you’re working.”

Once the leadership is on board for an idea, and you having enough moving parts in the organization to implement the procedure, you have to consistently be transparent with stakeholders in order to continue the process, Whitley explained. You must make analysis and data available to all affected parties and let all of them have a voice in process.

“Do you [decisions] in a transparent way, informed by data, in a way that tries to maximize outcome and deliver value for the taxpayer, or do you make them by other criteria?” Whitley asked.