Data analytics gains momentum in agencies

About two-thirds of federal agencies in a recent survey are using data analytics systems to improve operations, and there is great potential for more gains, according to a new study.

The May 22 report, “Leveraging Data Analytics in Federal Organizations,” is based on in-depth surveys with eight federal agencies. It was produced by the Association for Government Accountants and sponsored by Accenture.

The study found that most of the data analytics currently being used are focused on targets established by the White House—including reducing $125 billion in improper payments government-wide, improving financial performance and identifying high-risk investigative targets.

At the same time, several agencies interviewed have had great success in utilizing data analytics for enhancing their operations, and their techniques and best practices could be applied to achieve benefits at other agencies, the report suggested.

For example, the Agriculture Department’s Food and Nutrition Service reduced the rate of fraudulent food stamp trafficking to 1 percent, down from about 2.5 percent, by using data analytics, the report indicated. Trafficking means the food stamps are sold for cash, which is illegal.

The data analysis helped the agency quickly identify merchants who were illegally selling food stamps and remove them from the program.

“Based on benefit levels of $75.6 billion in FY 2011, we estimate that this would translate into $1.1 billion of benefits that were not trafficked last year,” the report said.

The remaining one-third of respondent agencies said they are not using data analytics for various reasons: 67 percent cited lack of funding; 53 percent cited a lack of staff and 33 percent said they were unsure how to develop a data analytics system. Many of the agencies mentioned more than one reason why they were not using the systems.

“Given the conclusions of this research initiative, it appears while most government leaders have a general understanding of data analytics, they are not yet champions of integrating these tools into their agencies,” Relmond Van Daniker, executive director of the association, said in a news release.

“While there is no clear plan to leverage the federal government’s investment in data analytics, they are in a good position to build on the advances they have already made,” Van Daniker added.

The eight agencies surveyed in the report are the Recovery Accountability and Transparency Board; USDA Food and Nutrition Service; Defense Department's Defense Finance and Accounting Service; Defense Logistics Agency; Naval Sea Systems Command; Education Department's Office of Inspector General; Health and Human Services Department's Centers for Medicare and Medicaid; U.S. Postal Service, Office of Inspector General.