How can you avoid another year of budget & planning chaos?
Effective planning and budgeting should empower your whole organization to further its mission. But Excel - which was designed for single-user productivity - is to limited to help . You need a more robust tool.
Government agencies and not-for-profit organizations face unique challenges in budgeting and planning. They are accountable to there constituents for sound fiscal management and these constituents require that program objectives are met and funds are properly allocated and used efficiently. In addition because of funding sources and long term assets like roads and sewers the budget horizon for governments and not-for-profits is multiple years. In the case of long term assets it could be 25 years. All of this requires sound, forward looking management.
Host CPM enables Government agencies and Not-For-Profit organizations to optimize planning and forecasting to manage all aspects of organizational performance to the benefits of their constituents. The important benefits include:
- Host CPM provides support for fund accounting, fund balancing and the complex dimensionality typically found in governments agencies and Not-For-Profit companies.
- Host Budget Templates provide an Excel-like spreadsheet interface that leverage the Excel look, feel and syntax for fast user adoption and flexible configuration.
- Host Business Rules provide structure and flexibility for creating baseline budgets driven by current economics and agency demographics.
- Host Discretionary Initiatives allow for the creation of Decision Packages as unique, independent projects that can be layered on top of baseline budgets.
- Host Budget includes detail HR planning so you can budget and build decision packages for the public sector's largest expense: human capital. HR planning includes the ability to model complex salary and compensation plans and statutory employees.
- Host Budget includes detail capital expense planning for managing long term capital requirements associated with the services, sewers, roads and physical assets used by the entities constituents.
A cornerstone of Host Budgets feature set for government agencies and not-for-profit companies is the ability to do baseline budgets based on current economics, demographics and "what-if" variables. The diagram below identifies the baseline/decision package budget process available within Host Budget:
The process for creating and merging baseline budgets with bottom up budgets include:
- Step 1: Start with initial assumptions and convert them to Host Business Rules, process the business rules to create a detailed baseline budget scenario. Iterate through running reports on the scenario, modifying the assumptions and rerun the rules until the desired baseline budget scenario is created. The top three boxes in the diagram (Assumptions, Business Rules, Baseline Scenario) depict this process from a budget office perspective.
- Step 2: Copy the baseline budget scenario to the "bottom up" budget that users can modify and "make real". Users typically use Host Budget Templates or Discretionary Initiatives to modify the "bottom up" budget. Discretionary Initiatives translate to "Decision Packages" in a not-for-profit environment. Discretionary initiatives allow the not-for-profit to manage a portfolio of projects and their expected cost/benefits, even if they go unapproved for this budget cycle. The bottom three boxes (History Scenario, Templates and Discretionary Initiatives, Bottom Up Budget) describe the budget process from the user perspective.
- Step 3: Use reporting and ad hoc analysis to compare the original baseline budget to the bottom up budget and analyze variances.
The rationale for the baseline budget process is:
- Not-for-profit and government agencies typically provide, at a minimum, the same level of service next year that they are providing this year.
- Changes in service, either up or down are budgeted via Decision Packages (Discretionary Initiatives in Host) which represent independent projects which can be approved and act as modifications to the baseline budgets or go unapproved and held as a portfolio of potential projects for the future.