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The FreeBalance Approach to Public Investment Management Software

 

May 9, 2017

There is rising interest in improving public investment planning and public investment management. The management of long-term capital public expenditures is seen as a critical contribution to sustainable growth. This rising interest in public investment management includes finding better automation and management through the use of Government Resource Planning (GRP) enterprise software. This is the fourth part of a series that explores:

  1. Why is public investment management crucial?
  2. How can software enable the public investment lifecycle?
  3. Why is integration among public investment software systems and subsystems important?
  4. What software solutions are available from FreeBalance to assist government in managing public investments?

What software solutions are available from FreeBalance to assist government in managing public investments?

FreeBalance is one of many vendors with products that support elements of Public Investment Management (PIM) at the intersection of GRP, ERP, CPM, M&E and PPM categories of enterprise software, as described in a previous post. There are few vendors who provide comprehensive PIM Commercial off-the-Shelf (COTS) solutions. The decision to implement a comprehensive government PIM solution relates to functionality needs and integration risk.

The purpose of this blog entry is to describe how FreeBalance addresses PIM requirements to enable governments to benchmark solution sets.

How does FreeBalance handle PIM subsystem integration and overlap?

freebalance-lifecycle

The PIM lifecycle includes many different possible subsystems where functionality can overlap. The product terminology used by different vendors can be confusing. Some COTS vendors provide a set of modules that were developed independently, often through company acquisitions. Other COTS vendors, like FreeBalance, have a portfolio of modules developed on a single platform.

We took a “business component mapping” approach to the design of the FreeBalance Accountability Suite. This resulted in the creation of the “Public Financial Management Component Map” that identified all aspect of PFM that would be addressed by the software, in 2006 [see diagram at beginning of the post]. The design included the reuse of business objects or what we call “government entities” across multiple applications. The result of this design is that a portfolio of functionality can be assembled to support a government’s PIM needs with central metadata control and controls consistency. This approach has been adopted by some enterprise software vendors and is known as a “unified design” rather than an integrated design.

The unified design supports integration because all functions share the same foundation and definitions. Metadata is defined in one place. The legacy “integrated” design uses additional “metadata management” software to handle integration where modules can have completely different definitions.

How does the FreeBalance Accountability Suite support PIM functionality?

The FreeBalance Accountability Suite is structured, for marketing purposes, as a platform with six module families:

  • Public Financials Management (PFM)
  • Government Treasury Management (GTM)
  • Public Expenditure Management (PEM)
  • Government Receipts Management (GRM)
  • Government Performance Management (GPM)
  • Civil Service Management (CSM)

The definition of these module families is somewhat arbitrary, as it is with most enterprise software vendors. The functions within the module families that support the PIM lifecycle are:

  1. Planning: GPM Performance Budgeting and GPM Performance Management and GTM Debt Management that covers:
    • Financial Planning
    • Allocation
    • Budget Planning
  2. Acquisition: PEM Purchasing & Procurement, E-Procurement, Contract Management that covers:
    • Commitment Management
    • Tendering
    • Contract Development
  3. Implementation: PFM Project Accounting and PEM Contract Management and Payment Management that covers:
    • Project management
    • Contract Management
  4. Maintenance: PFM Asset Management, Fleet Management and Facilities Management, and GPM Performance Budgeting
    • Maintenance
    • Asset Management
    • Budget Management (reconnects with budget planning)
  5. Results: GTM Risk Management, GPM Audit Management, Dashboards and Alerts that support M&E functionality
  6. Governance is supported through:
    • Set-up through Configuration in the Platform
    • Program Management through Program Budgeting Configuration
      • Program management office
      • Project and program steering committees
    • Transparency through:
      • Budget planning transparency: Budget Transparency Portal
      • Budget execution transparency: Budget Transparency Portal
      • Procurement transparency: E-Procurement Portal
      • Results transparency: E-Results Portal
    • Strategic Reviews through GPM Audit Management

What is the E-Results Portal?

Results Portal

The FreeBalance E-Results Portal, as implemented in Timor-Leste, enables citizens to view the progress and results of public investments.  The E-Results Portal represents one of the the final stages in the PIM lifecycle. In this implementation of the FreeBalance Accountability Suite:

  • Objectives are incorporated within the COA structure for programs and performance
  • Narrative about project objectives are described for any public investment projects proposed during capital budget planning in GPM Performance Budgeting
  • Project ranking and approval occurs during the capital budget planning process using GPM Performance Budgeting
  • Budgets are placed in the core GRP system for commitment accounting
  • Acquisition is handled by PEM modules that includes the creation of procurement documents from the GRP, support for multistage procurement, e-procurement, goods receipt, contract creation and presenting the results of procurements on a portal
  • Implementation is handled primarily through the PEM Contract Management functionality where milestones and payments are processes to show amount expended and percent complete with budget variances, and evidence such as pictures and documents
  • Results portal is updated daily showing progress, where additional narrative about objectives and results can be added

 

 

 

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Doug Hadden

Doug Hadden

Executive Vice President, Innovation at FreeBalance
Doug is responsible for identifying new global markets, new technologies and trends, and new and enhanced internal processes. Doug leads a cross-functional international team that is responsible for developing product prototypes and innovative go-to-market strategies.

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