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Change Models:Managing the Evolving
Role of the Budget Office
Presenter:William A. Flexner
Flexner & Associates, Chapel Hill, NC
NC Local Government Budget Association Summer Conference
July 18, 2007
Creating Reality
• First we shape our structures, then they shape us – Winston Churchill
• The best way to predict the future is to invent it – Alan Kay
• The best thing about reality is you get to make it up – Kimbal Wheatley
• If you don’t know where you’re going, you’re going to get there anyway – Anonymous
• If you don’t change directions, you’re going to get where you are going -- Anonymous
Have you ever used an anonymous opinion gathering device such as this?
No
Yes
0%0%
1. No
2. Yes
Have you ever driven more than 30 MPH over the speed limit?
No
Yes
0%0%
1. No
2. Yes
Did you ever lie to Mom?
No
Not e
xact
ly a
lie
Yes
0% 0%0%
1. No
2. Well, it wasn’t exactly a lie
3. Yes
What is the role of the Budget Office?
The non-budget person might say…
“The budget office translates an organization’s plans and policies into financial terms”
Starting with this definition…How has the role of the Budget
Office evolved over the past 10 years?
What Do We Mean: “Change Models”?Change: the transition that occurs when going from one state to another.
Models: simplified representations used to explain the workings of real world systems, processes or
events.
Applied to: Budget Office, entire organization, community and other organizations
Change Model # 1
“Pull Change”
In order to solve the Social Security System crisis, President Bush proposed the shifting up to 25% of retirement funds into Personal Savings Accounts.
Can you support this solution?
0%0%
1. No
2. Yes
In order to absorb 8,000 to 10,000 new students a year, the Wake County School Board is proposing to move a significant
number of its schools to 12 month calendars.
Can you support this solution?
0%0%
1. No
2. Yes
Scholars at the “Phoenix Institute for Public Management” have proposed that Local Government Budget Offices stick
with the knitting and focus only on budget preparation and not on any expanded roles.
Can you support this solution?
0%0%
1. No
2. Yes
Pull ChangeCommunicated
Accepted
Change Model # 2
“Starting Change”
Have you ever had a really messy office, garage or closet?
No
It w
asn’t
real
ly m
essy
Yes
0% 0%0%
1. No
2. It wasn’t really messy
3. Yes
D x V x F > Rc
Starting Change
DissatisfactionWith Present
enVision aBetterFuture
FirstSteps
ResistanceTo Change
Change Model # 3
“Adoption of Innovation”
Which of the following best describes you and an Apple IPod?
First t
o buy
Early
buye
r
Needed
pro
of to
buy
Still i
nvest
igat
ing
No in
tere
st
0% 0% 0%0%0%
1. One of the first to buy it
2. Bought one early on, but only after talking with someone who already had one
3. Bought one, but waited until the technology and access to songs were proven
4. Am still investigating buying one, but not ready yet
5. Really have no interest
“Budget AI” is a new software product combining artificial intelligence software with a national “local gov’t” budgeting database to reduce the time to produce a first draft of a city or county budget by 50%.
Which of the following best describes your reaction?
0% 0% 0%0%0%
1. Sign me up for the Beta version. I want it now
2. It sounds great but let me talk with someone who has it up and running
3. Show me that it really works in the real world and I’ll consider it
4. Not interested now, but send me updated information periodically
5. Really have no interest
Adoption of Innovation
Sources: Everett M. Rogers, Diffusion of Innovation, 1962 Geoffrey Moore, Crossing the Chasm, 1991
Chasm
Change Model # 4
“Grow or Die”
Time
Return
Effort
1. Startup
2. EarlyGrowth
3. LateGrowth
Source: George Land, Grow or Die, 1973
4. Limits
5. Decline6. New Startup
7. New Early
Growth
Growth Curve
Where is the China
on this growth curve?
1 2 3 4 5 6 7
0% 0% 0% 0%0%0%0%
1. Startup2. Early growth3. Late growth4. Limits5. Decline6. New startup7. New early
growth
1
2
3
4
56
7
Where is the U.S. on this growth curve?
1 2 3 4 5 6 7
0% 0% 0% 0%0%0%0%
1. Startup2. Early growth3. Late growth4. Limits5. Decline6. New startup7. New early
growth
1
2
3
4
56
7
Where is YOUR Budget Office on this
growth curve?
1 2 3 4 5 6 7
0% 0% 0% 0%0%0%0%
1. Startup2. Early growth3. Late growth4. Limits5. Decline6. New startup7. New early
growth
1
2
3
4
56
7
Change Model # 5
“Linking Strategy to Action”
Change: Linking Strategy to Action
WW Where now
WHWhat How
WWWho/When
/Where future
Change Model #6
“Setting Priorities”
Focus on the “Whats”Let’s say you have developed a list of Critical Success Factors (CSFs)…the “Whats”that will help you get to “Where” you are going
A. Aaaaa aa aaaaa aaB. Bbbbbbb bbb bbbbbbC. Ccc ccc ccc cccD. Ddddd ddddd ddddddddd dE. E eeee eeeeeee eeee F. Fffff ffff ffffff ff ffff fff G. Ggggg gggggg ggg ggggggggH. Hhh hhhhhh h hhhI. Iiiiiiii iii iiiiiiiii iiiiiiiJ. Jjjjjjjjjjjj jjjjjjj jjjjjjjjjjjjjj
How do you assess which ones are more important; how do you determine “what” to focus on?
IMPORTANCE
CURRENT PERFORMANCE
High
Low High
Focus on the “Whats”
From Option Technologies Interactive, 1980s to present
IMPORTANCE
CURRENT PERFORMANCE
High
Low High
C
D
BE
G
AF
HI
Assessing the “Whats”
J
From Option Technologies Interactive, 1980s to present
Strengths
OverkillsGripes
Opportunities
Maintainers
Emergents
Change Model #7
“Action Planning”
Focus on the “Hows”
Hows (actions)
Whats (CSFs)
ImpactsC F A G J H B
•Install cost software•Use cost information
•Train collections staff•Install new equipment
•Engage in P.R.•Target key markets
•Reduce turnaround time•Develop incentive plan
•Generate new ideas•Determine what works
2
1343111
12
From Hardaker & Ward, “Getting Things Done,” Harvard Business Review, 1987
Change Model # 8
“Creating anAdaptive Organization”
Which of the following would you prefer? Have
someone…
… te
ll yo
u wha
t to d
o
… a
sk y
our o
pinio
n
0%0%
1. Tell you what to do
2. Ask your opinion about what should be done
Organizational ChangeTraditional Participative
AUTHORITY
MANDATE(“Telling”)
COMPLIANCE(“Have To”)
TIME
PRODUCE(“Minimum Standards”)
LEADERSHIP
INFLUENCE(“Asking”)
COMMITMENT(“Want To”)
TIME & ENERGY
PERFORM(“Meet Expectations”)
Time
Universal
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