How Unit4 FP&A can support demand planning for public sector services
Planning and forecasting demand for public sector services is vital as organizations deal with continued change, increased demand for service, and continue to deal with backlogs.
In this blog, we explore the need for service demand planning and forecasting in the public sector, how it can be done effectively and efficiently, and look at how the digital transformation of operations and processes can help – keep reading to learn more with Unit4.
What is demand planning?
Demand planning for services is how an organization strikes a balance between the allocation of resources, how much demand for service exists, and how to meet these demands with the resources or capacity at hand.
Naturally, the public sector needs to ensure they have the capacity to meet demand in order to deliver services to citizens effectively and efficiently.
What is forecasting?
Forecasting is a vital process for service demand planning, enabling organizations to ensure that the resources they allocate to a service today do not detract from the resources needed to meet future demand.
In the public sector, managing peaks and troughs can be tricky as the demands on many services fluctuate unpredictably against a backdrop of restricted funding which affects resources.
So, the public sector can benefit from forecasting service demand, which won’t always be deadly accurate but when based on accurate and 24/7 available data, organizations can use this process to ensure they can allocate resources efficiently to ensure demand can be met for the future, not just today.
Why data needs to lead demand planning and forecasting for services
Effective public sector service demand planning and forecasting processes rely on data - this data must be accurate, but the data also must be up-to-date and provide a full picture, as demand will affect all areas of an organization.
The problem is most public sector organizations still use manual and laborious processes that provide either limited or out-of-date data, with legacy systems like Excel simply adding unwelcome manual tasks to the equation.
While Excel is littered with productivity issues, and multiple versions of the truth, without integrated data from all your departments and functions, it becomes nearly impossible to allocate resources. Integrated data is vital and gives organizations a broader understanding of the resources they have, how to allocate them, and to which tasks.
Why a single platform is needed for flexible demand planning
Modern Cloud solutions, like Unit4 ERP, integrate your Finance, HR, HCM, procurement, and more, all from one place with instant access to data and analysis to boost forecasting accuracy used in planning demand.
A Cloud platform provides deeper insights and understanding of your broader organization - we help you build a strategy that you can implement instantly across all functions of your organization, utilizing advanced reporting capabilities to make this strategy clear to all, helping you be more agile to react to fluctuating changes in demand.
Unit4 FP&A provides scenario planning capabilities that allow your teams to prepare for demand and understand how increased demand in the future could affect current workloads, allowing you to adapt on the fly to future disruption.
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4 best practices for service demand planning in the public sector
To make demand forecasting effective, your FP&A team will need to guide your organization toward more informed decisions that continually drive optimal performance.
Let’s look at the critical factors and steps in this process:
1. Identify key organizational drivers and critical uncertainties
Your public sector organization will be managing a myriad of internal and external factors and challenges every day, like staff availability, funding changes, and increased costs. Before any demand planning takes place, the first thing you need to do is identify the drivers that affect demand resolution.
For example, an organization that provides social care will likely need to pay attention not just to funding from local councils or central government, but also how well-staffed they are, as the latter will drive their ability to deliver their vital services to citizens.
In other words, when you know which parts of your organization have the largest effect on how demand is dealt with, it’s easier to develop a strategy to adapt as these issues occur to ensure that demand is being met effectively.
Notably, some organizations may find that digital tools can help solve many of these drivers. Where talent shortages exist, demand planning can bridge this gap temporarily by identifying resource gaps and ensuring demand can still be dealt with.
2. Generate multiple scenarios with Unit4 FP&A
Once the drivers of demand resolution are identified, you can then build multiple scenarios to help inform strategy when these drivers are affected. To give this structure, use decision tree thinking or scenario planning to ensure you have a mutually exclusive collectively exhaustive (MECE) framework.
Doing this will help you identify how increased demand could affect your financial assets, but also how your organization’s financial outlook may change with decreased demand.
With more of an idea of how your organization could bounce back if they have tools to deal with demand, this can create a business case for these tools, improve morale generally, and also increase trust with stakeholders, partners, donors, and more.
3. Develop strategy based on drivers, rather than specific scenarios
Disruption isn’t going away but remains troublesome to prepare for. Our minds often disregard adverse or low-probability outcomes, or we overestimate how likely the best-case scenario is. By identifying the drivers that affect demand planning we can develop strategies to curtail its effects.
For example, a local authority could divide users in the social care function into specific groups based on their needs to better match services with demand. This could help utilize all capacity effectively, such as scheduling some services at different times.
Scenario modeling in Unit4 FP&A is useful to develop a financial strategy for whatever may occur. It’s near impossible to predict disruption, but you can prepare for the unpredictable by developing the strategy necessary to bounce back.
Organizations need to develop strategies led by data to deal with the affected drivers. When the unpredictable occurs, you have a strategy to resolve the specific driver, as this can be used for any disruption or effect on demand, rather than developing a strategy for an isolated scenario.
4. Harness FP&A to make 24/7 planning a reality
Despite all the above, it’s also important to understand that no matter how hard you try, it’s impossible to capture every possible outcome that each critical factor could bring. In reality, demand planning circumstances change rapidly, and despite your best efforts, scenario planning must offer real-time planning capabilities to be truly effective.
Modern tools let your FP&A team harness live data to build and iterate infinite scenarios. This enables you to discuss plans in near real-time, which drives more informed decisions when action is needed most.
There’s no number of plans that can cover all the possibilities even for one organization, let alone a whole sector. The result is that organizations must look to dynamic scenario planning tools that can adapt quickly, rather than relying on hyper-specified strategies.
How can Unit4 transform your demand planning process?
Our intelligent FP&A software solutions free your teams to spend more time delivering insights and creating value for your organization. Our solution provides the visibility and insight you need to understand the numbers more deeply and turn that insight into action for better results.
Unit4 FP&A lets you bring all your data and planning together to guide your business into the future, helping you boost demand planning using up to date budget figures or HR insights for better resource and demand planning.
Interested to learn more? Hear from impartial analyst BARC why they have ranked our FP&A among the top 3 for customer satisfaction.
