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Aligning strategic planning and finances for a better budgeting process

By Jeremy Buskirk posted 25 days ago

  

by Senior Manager Jeremy Buskirk and Director Matt Bubness, Baker Tilly 

As another fiscal year and budget process ends, you may be breathing a sigh of relief. This is well deserved. At the same time, this is the time to consider how to improve the budget process for next year and beyond. Now could be the best time to do an assessment of the process by considering it from your perspective as treasurer/CFO as well as polling colleagues to see what worked well and what didn’t. Then, you can begin planning improvements for next year.

While taking time to evaluate the process is certainly a time commitment, it may help in ways beyond building a better budget process for subsequent years. Evaluating how the budget planning works and considering the key components, particularly the strategic plan, can help move you from a reactive mode to being more proactive in budgeting and planning.

The following provides thoughts for improving your budgeting that will help lead to better decision-making and, ultimately, more efficient and effective resource allocation to best support students and their needs.

First, a budget should be well-informed by the district's top needs and priorities. The strategic plan is the logical document to provide this direction, but is your district’s strategic plan robust enough to do so? Most strategic plans will talk about a district’s mission, vision, goals and objectives, but is there enough information in the plan or related documents to help determine what kinds of investments in things like staff and programs in are needed to achieve these goals and objectives? This is key to guiding and structuring better conversations among district leadership to best allocate resources. While simplistic, requests for additional resources not aligned with the strategic plan should only be considered after other aligned priorities have been funded. Setting this expectation will help to reinforce the ground rules of how decisions are made and to support confidence and buy-in to the overall budget process.

Second, having better data and analysis to further guide decision making is also pivotal, particularly in more challenging fiscal times. An area that can often be more intentionally examined is staffing, particularly at the building level. With wages and benefits accounting for at least three quarters of the budget, having in-depth analysis and corresponding discussions about staffing is crucial. 

Key questions to consider include:

  • At the building level, is there regular analysis of student to teacher ratios to ensure consistency district-wide?
  • For high schools, are the number of students enrolling in certain subjects/areas, particularly electives, examined and discussed annually, if not more frequently?
  • Are levels of support staff consistently provided based on building enrollment, square footage or another framework?

Analyzing this data may uncover areas for improvement and help promote more informed discussions on how to best resolve staffing challenges. Examining staff from a district-wide level and looking at year-over-year trends is a key step to determining whether staffing increases are supporting better outcomes or services. Related to a staffing analysis, districts should consider creating an inventory of programs and related staff to facilitate conversations regarding how each program supports district outcomes. Keep in mind that just because a program is working well does not mean it helps achieve a district’s goals.

Finally, in addition to better alignment with the strategic plan and more robust analysis and use of data, regular conversations about budget spenddown throughout the year can improve the budget process. Routine conversations with district leaders will improve comfort with discussing budgets, understanding how programs and services are provided, and aligning finances with strategic plans. Whether quarterly or monthly, these regular conversations can help get out in front of potential issues. Connecting conversations about the dollars and key indicators of performance will help support not only more effective service delivery but provide a springboard for collaborative dialogue for upcoming budgets and future needs. 

Re-examining the budget process can be daunting but is certainly a worthwhile endeavor. Remember, the process will not change overnight. Start small and focus on common areas of frustration for those involved. Those initial quick wins that make the process better for all will help in creating traction for additional improvements going forward.

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