If, as someone working on the business side of education, you are actively using your unique knowledge of the finance and operations to shape the way your school system uses resources for the children you serve, then you are a high-performing school business official. It’s the epitome of school business. It’s the intersection where a well-run business meets an enterprise whose product is the development of young minds and educated citizens.
To demonstrate that this process is happening, it seems you would need a well-done strategic plan, one with limited, specific, and measurable goals and objectives, to be fully integrated with an expertly created budget that demonstrates how decisions were made to allocate resources to where they are needed most.
On Friday, I had the chance to hear from two ASBO members who presented during a pre-conference session at the Government Finance Officers Association (GFOA) conference in Minneapolis. While the GFOA doesn’t do much specifically for schools, they certainly know their way around a public agency budget, and their work with both K-12 and community colleges garnered them a grant from the Gates Foundation to work on excellence in school budgeting.
ASBO members Carol MacLeod and Claire Hertz, CFOs in their school districts, have been working with their districts and the GFOA to help shape the K-12 side of this budgeting excellence project. What I found fascinating as they described the process in their districts is that they each took different approaches toward the same goal of showing how their budgeting was focused on the achievement goals of the district, and some common elements appeared.
Using funds from a separate grant (not district funds), Carol was able to bring in a nonprofit consulting firm to create a strategic resource map of how her 40,000-student district in Florida currently spends its money and how that compared with other school systems. Ultimately, she created a three-year strategic financial plan that identifies instructional priorities and reclassifies them as investment opportunities. The plan uses metrics such as the percent of budget that was realigned toward the instructional priorities and the percent of stakeholders, both internal and external, who see a difference in the focus toward the priorities. The school board formally approved the strategic financial plan, and she is using it now to affect the 2014-2015 budget process.
Claire is in a similarly large (40,000 students) school district in Oregon, but did not have grant funding to support her efforts. She used existing data sets from the district and state to identify her investment opportunities. The data were already familiar to many, so she needed to be purposeful about creating a conversation with her stakeholders about the data and what future results might look like if they did not act to make improvements. As Claire put it, she became “attached at the hip” to the chief academic officer in the district as they worked with their teams to lead the conversation on priorities and then to implement the efforts (from budgeting through to action) to make improvements.
While Carol was able to get some outside funding to help with the process of being more strategic with her resources, she was facing both increased enrollment and declining revenues, so the tough decisions that needed to be made could now be made more strategically. Claire had to make do with internal capacity for her strategic process improvements, but was fortunate to see a return of some revenue that had disappeared in the great recession. This prompted the question: As revenue returns, will we put it back into the same old expenditures, or will we truly make strategic investments?
Three factors (at least) were similar in both of these efforts:
- Data – Both Carol and Claire made use of data to start the conversations in their districts about the use of resources and the academic goals of the school systems.
- Communication – Both Carol and Claire facilitated good communication. All stakeholders, internal and external, needed to be aware of the instructional priorities and the investment opportunities. They had to have a voice in making the tough decisions when not every priority could be addressed.
- Process – Although Carol and Claire each approached this differently, at the end of the day it was about the process. They made the effort, they used the data, they facilitated the communication, and while simple answers to complex questions are all the rage these days, they avoided that trap by developing a final process that was complex, but no longer complicated.
These few paragraphs don’t do justice to their four-hour presentation, which in turn, represented just a portion of their years of work. GFOA is working to develop a Spending Money Smartly toolkit that is expected out this summer, and we will certainly be sharing that with ASBO members. I hope we see more from Carol, Claire, and the GFOA researchers on this topic as well. Watch this space and we will keep you informed.