How State and Local Government Can Transform Spend Management

This article was originally published at American City & County on November 15, 2017.


While state and local governments face the same problems as the private sector, they also face unique challenges when modernizing legacy IT systems such as tight and highly scrutinized budgets, heightened citizen and employee expectations, and limited manpower. Additionally, because state and local governments’ focus is often divided between improving citizen services and basic day-to-day IT operations, innovation may not be a priority for every agency. However, CIOs across the country are recognizing the clear benefits of adopting cloud-based, software-as-a-service (SaaS) spend management solutions.

Cloud-based solutions are attractive within the public sector as there is significantly reduced upfront investment when compared to the cost of building an expensive in-house system. Additionally, in-house systems are expensive to maintain and often become antiquated within a few years. Cloud-based SaaS solutions can be quickly implemented and are continuously updated by third parties. SaaS solutions provide greater value for significantly less investment while providing government with continuous innovation, meeting their needs today as well as in the future.

Because state and local governments face tighter budgets, they require a high level of transparency and control over how and where employees are spending taxpayer resources. Typically, employee-initiated expense is the second largest controllable expense for most state and local organizations right after payroll. State and local governments are also heavily scrutinized on the quality of citizen services, forcing agencies to focus on how every taxpayer dollar is spent. With enhanced expense tracking, agencies can better control costs as well as reduce overhead spending through the adaption of SaaS solutions which require less IT involvement.

Outdated and slow spend management systems can frustrate employees and hurt agency morale. Modernization puts employees in the driver seat, resulting in higher productivity and accountability while improving user experiences.

State and local governments need to understand that the move to the cloud is happening across all software platforms. It is now a question of “when” the move to the cloud will occur rather than “will it?” If you want to keep and retain the best talent, you need the best technology, and cloud-based SaaS offerings provide that. They improve the user experience, making it easier for employees to do their job and better serve taxpayer interests.

Non-systematized tools and processes create challenges for smaller government agencies because they rely heavily on manual data inputs that typically take longer to complete, are more expensive when you factor in the cost of human capital and are prone to data entry errors, making compliance very difficult.  By embracing SaaS, agencies can automate interactions, streamline processes and save time and money.

Government agencies require a holistic, automated solution where human resources, accounting, and ERP teams can all interact to obtain a complete view of the agency’s spending. For example, the State of Georgia recently consolidated travel arrangements by combining its online travel and expense management system and its designated travel agency. The state now provides a web-based, fully automated, paperless travel solution that is integrated within its travel and spend management system. This solution strengthens enforcement of travel policies, provides better information to agency management, and results in quicker expense reimbursement to employees.

When adopting cloud-based SaaS solutions, government agencies should also focus on user experience, productivity, and mobility. Travel requires a mobile-friendly interface that is easy to use. When agencies have dozens of employees traveling for work, those employees should be able to book and change travel plans, submit supply requests or approve requests from their mobile device.

Now is the time for state and local governments to invest in the people, processes, and technology that will fuel their digital transformation. Moving to the cloud with a SaaS solution provider can help state and local agencies save money, increase productivity, and improve delivery of government services.

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