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**Financial Services Assessment Guide (SAG)**

**Phase I Exposure Draft**

**January 3, 2007**

**Overview**

The Financial Management Line of Business (FMLoB), in collaboration with the federal financial management community, is establishing a set of Financial Services Metrics that will facilitate an assessment of financial services government‐wide.  These metrics are designed to help identify opportunities to improve the performance and affordability of the financial services provided by Shared Service Providers (SSPs) and federal Agencies.

The Financial Services Metrics will be used for the following purposes:

· Enable SSPs to make more informed judgments regarding the performance and affordability of the financial services they provide, and how they compare to their competitors.

· Enable Agencies to make more informed judgments regarding the performance and affordability of the financial services they provide in-house, how they compare to other Agencies, and which SSP might best serve their needs as they look at potential migrations of services under the FMLOB framework.

· Enable key stakeholders, including the Chief Financial Officers’ Council (CFOC), the Office of Management and Budget (OMB), and FMLOB, to make more informed judgments regarding the financial performance of SSPs and Agencies, and work with SSPs and Agencies on strategies to continually improve both performance and affordability.

Performance reports will be provided to various audiences as appropriate, including the CFOC, SSPs, Agencies and OMB, and may be made available to the public.  Performance will be evaluated against established baselines and applicable performance benchmarks.  As this effort progresses, reports will provide performance trends, distinguish top performers from poor performers, identify improvement opportunities, and identify the need for corrective actions as warranted.

By making SSP and Agency performance more transparent, establishing accountability for improved results, and increasing competition among SSPs, both SSPs and federal Agencies will be encouraged to continually improve both the performance and affordability of the financial services they provide.

Performance metrics will be implemented using a phased approach.  Phase I will focus on defining and collecting an initial set of high value, low burden metrics.  Phase II will focus on refining these metrics, collecting an expanded set of metrics, improving reporting capabilities and accountability mechanisms, and streamlining the collection effort.

All Agencies will be required to report performance data through a single system managed by the Financial Systems Integration Office (FSIO).  All data submitted to FSIO will be considered public information unless specifically identified as confidential and approved as such by FSIO.  

**Implementation**

The overall performance metrics will be implemented using a phased approach.  Each phase will build upon the previous phase’s accomplishments and will emphasize communication and coordination with the financial management community.

**Phase I**

Phase I will be critical to building a baseline of performance and learning lessons for subsequent phases.  The Phase I measures have been selected from the two mandatory service categories: IT Infrastructure Hosting and Administration and Application Management. 

The initial set of ten metrics was developed based on SSP and Agency responses to the Value and Burden Survey conducted by the FMLoB during November and December 2006.  Specific attention was paid to ensuring the metrics selected offered both a high value for potential users and a low burden of collection.  The survey results indicated that the collection of cost measures would pose a significant burden, and therefore no cost metrics were selected for Phase I.

The Phase I metrics to be reported can be found in Appendix A. 

By May 1, 2007 SSPs and Agencies must report data for March 2007 for the metrics included in Appendix A.  Data for subsequent months must be reported within 30 days after the end of the reporting period.

Detailed descriptions of each Phase I metric are included in Appendix B. [Detailed descriptions of each Phase I metric will be agreed to in upcoming workshops and included in the final release of the Phase I Service Assessment Guide.  FMLOB will work with agencies to determine the appropriate detailed descriptions.]

Data will be submitted to FSIO according to the instructions for data entry included in Appendix C.  [Data entry instructions will be included in the final release of the Phase I Service Assessment Guide.  System development is currently underway by FSIO].  

Initial reports will be generated and circulated by FSIO, though targets and goals for the measures will not be set until a baseline can be established.  

**Phase II**

Phase II will focus on expanding and refining the measures for IT Infrastructure Hosting & Administration and Application Management Services, and add a limited set of measures for the Systems Implementation and Business Process categories.  The FMLoB will also establish metric reporting procedures and tools to assist Agency submission of performance data and address adding important cost measures and their collection burdens.  During this phase, lessons learned from Phase I will be incorporated and result in an update to this guide. 

**Appendix A.  FMLoB Phase I Financial Performance Measures**

**Appendix B.  FMLoB Financial Performance Measure Definitions**

**Future Development:  Detailed descriptions of the Phase I performance measures.**

**Appendix C.  FMLoB Performance Metric Reporting Procedures**

**Future Development:  Instructions for reporting performance measurement data.**