Indiana Tax Commissioner Kenneth Miller had every reason to believe that recent improvements in tax administration were paying off, but he needed a way to demonstrate tangible results to the governor and legislature. So Miller tapped Accenture Ltd. of Hamilton, Bermuda, to analyze various initiatives implemented by the Indiana Department of Revenue over the past decade. Accenture's new public-sector value model, or PSV, analysis let the department measure the success of initiatives in areas such as greater voluntary compliance and improved customer service. "We wanted to see if we were on the right track," Miller said. Accenture did the three-month PSV analysis as part of a four-year, $12.5 million applications management contract signed last year with the department. The final document, which consists of a 25-page report and a 40-page appendix that details the data captured and the metrics used, was presented to the commissioner in November, an Accenture spokesman said. The report chronicles changes in agency performance over the life of the analysis and makes recommendations for future improvements.Simply put, a public-sector value model is a performance measurement tool for government that closely follows a shareholder value analysis for commercial enterprises, said Nathan Beadle, a partner with Accenture's tax and revenue industry practice that oversees the Indiana account. The completed analysis is a benchmark and decision-making tool that allows a department, or even an entire government, to measure how it is performing. The model is especially useful to departments seeking to justify technology investments and expenditures in a soft economy, according to industry officials."Agencies are constantly trying to balance costs with service," Beadle said. "[The analysis] helps agencies understand the effect of initiatives they've taken in the past and evaluate future initiatives." The PSV analysis that Accenture performs for state revenue agencies focuses on maximizing tax revenue, compliance rates and responsiveness to taxpayers, and minimizing taxpayer burden.An agency's ability to deliver for a specific outcome is measured using metrics that check the agency's performance. For example, the PSV score for maximizing compliance rates outcome is determined using a series of compliance metrics, including taxpayer error rates and the percentage of tax returns received on time. The PSV revenue industry model can be tailored and weighted to reflect the department's current emphasis. In the case of the Indiana Department of Revenue, its focus has shifted over the past few years from reducing taxpayer burden and increasing responsiveness to taxpayers to a greater emphasis on increasing tax revenue and compliance rates, Beadle said. Illinois Gov. Rod Blagojevich has asked Accenture to apply its PSV model analysis to assess the operations of a number of agencies in his state, Beadle said.A PSV analysis that might be right for one agency or government might not be right for another, Miller said. For it to work effectively, agencies and governments need to participate in the development of a PSV analysis model that will meet their needs and expectations. "As it goes along, it becomes almost like artificial intelligence," Miller said. "But you need to adapt it to your own environment.
