Pandemic Recovery Calls for Reassessment of Cost Optimization and Efficiency for State Government, According to Report from NASCA and KPMG LLP

    LEXINGTON, KY, April 27, 2022 /24-7PressRelease/ -- Despite some recovery from the economic impacts of COVID-19, state governments still face uncertainty and a volatile labor market. They are also proactively allocating unprecedented federal and state stimulus funds to bolster their recovery and invest in the future.

To help state governments respond to these challenges, the National Association of State Chief Administrators (NASCA) and KPMG LLP have released a new report, "Driving Cost Optimization and Efficiency: Recommendations for State Chief Administrators," which highlights five key priorities that state chief administrators should consider.

Government is clearly moving toward a more citizen-centered, digitally enabled, data-driven, agile, and connected future. In order for governments to achieve this vision, their operational approaches should be designed to enable and support it. According to NASCA's analysis of state chief administrative officers (CAOs) in 2021, budget savings and cost efficiency ranked among the top ten priorities of state CAOs, with the highest focus on determining where spending is most effective, limiting costs and allocating funding to deferred maintenance.

NASCA and KPMG LLP developed the State Collaborative to identify practical, tested solutions that state executives can use to address budget constraints, drive efficiencies, and optimize costs using strategies that advance government modernization. The report also details three case studies of how NASCA member states have applied cost-optimization and efficiency strategies

"State governments have been introducing innovative programs and expanding their services to their citizens over the past several years," said Pam Goins, Executive Director of NASCA. "This report emphasizes how targeted efforts to improve efficiency can lead to stronger economic growth. From these examples, we can see how operational excellence and improved performance can positively affect government operations."

Future-focused CAOs should embrace the technology, work models, processes, and innovations necessary to create responsive, citizen-centered, and cost-effective state government operations. The State Collaborative developed five key priorities:

Build a modern workforce. Prior to making an informed decision on a new job opportunity, skilled individuals look closely at a potential employer's brand and culture, choosing modern, digitally enabled and socially conscious environments that reflect their values, aspirations, and expectations.

Accelerate digitalization. Although there are obstacles, there is an opportunity to use the impact of the pandemic to drive government reform by leveraging digitalization for savings and value.

Enable more efficient operating models. Processes and organizational functions can be streamlined, realigned, and enabled to meet the evolving expectations and value propositions of modern government, thereby supporting strategic objectives, reducing costs, and avoiding unnecessary expenditures.

Enhance trust. CAOs should establish their role in their state's cybersecurity strategy and collaborate with cybersecurity leaders to incorporate cyber risk scenarios throughout their organization.

Extract greater value from state assets. CAOs have an opportunity to strategically reduce, expand or reposition their portfolios of leased and owned real estate and fleet assets to align with changing operating models while enhancing employee experience and productivity.

"The recent pandemic highlighted the need for state governments to accelerate cost optimization and efficiency efforts," said Yash Acharya, Managing Director in KPMG LLP's Government Finance Transformation practice. "This report provides practical ways that state administrators can navigate those efforts while facilitating a more digitized, streamlined experience for employees and attracting and retaining talent with the right tools to modernize government."

Methodology

25 NASCA members from 12 states participated in the NASCA State Collaborative. Participants represented states of various sizes, regions, demographics, etc. To preserve the anonymity of participants, insights are not attributed to specific individuals or states, apart from the state spotlights.

About NASCA

Founded in 1976, the National Association of State Chief Administrators (NASCA), is a nonprofit, 501(c)3 association representing state chief administrators—public officials in charge of departments that provide support services to other state agencies. NASCA provides a forum to exchange information and learn new ideas from each other and private partners. NASCA's mission is to help state chief administrators and their teams strategically transform state government operations through the power of shared knowledge and thought leadership. More information at www.nasca.org.

About KPMG LLP

KPMG LLP is the U.S. firm of the KPMG global organization of independent professional services firms providing audit, tax, and advisory services. The KPMG global organization operates in 145 countries and territories and has close to 236,000 people working in member firms around the world. Each KPMG firm is a legally distinct and separate entity and describes itself as such. KPMG International Limited is a private English company limited by guarantee. KPMG International Limited and its related entities do not provide services to clients. Some or all of the services described herein may not be permissible for KPMG audit clients and their affiliates or related entities.

KPMG is widely recognized for being a great place to work and build a career. Our people share a sense of purpose in the work we do, and a strong commitment to community service, inclusion and diversity, and eradicating childhood illiteracy. Learn more at www.kpmg.com/us.

Contacts:
Creighton Abrams
KPMG
917-453-3373
[email protected]

Tammy Borden
Program Manager
National Association of State Chief Administrators (NASCA)
859-514-9191
[email protected]

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