Budgeting – Culture, Philosophy, and Practice

  • June 15, 2021
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  • Bill Lemieux

The implementation of our strategic plan brought changes in culture, philosophy, and practice to Environmental Initiative. Along with the rest of the organization, those changes have impacted the finance and operations area, particularly within our budgeting and finance system. I want to share some of the ways these changes are having a positive impact on all of us today and will have into the future.

Prior Environmental Initiative financial systems were centered around ownership being maintained by primarily one individual with little collaboration. Information was typically disseminated on a need-to-know basis and instruction and guidance around budgetary decisions flowed from the top down. In 2019 efforts began to modify our financial systems.

In 2020 the change started to accelerate, in part in response to Pillar 4 of our strategic plan which states that we will “cultivate robust, effective organizational operations, revenue, and culture.” Breaking down silos within our programs was a first step. We did this in several ways, including implementing a shared leadership and ownership approach to budgeting. This new focus gives budget managers the responsibility for driving change and outcomes within their budgets. Senior management and finance leadership provide guidance and advice but do not explicitly give direction. Collaboration is the focus and it allows for the sharing of knowledge and skills at this level of the organization. The restructuring of the administrative staff and function was also undertaken to better suit the organization and access the talents and skills we have on the staff.

This culture change work would be difficult for the budget managers without the proper tools in place to establish innovative work plans and make sound financial decisions. Over the course of the last year, new and impactful reporting has been designed and provided to all budget managers as a way for them to better manage the organization’s resources. Some of these new reporting tools by program and project include:

  • Monthly and quarterly staff hours and dollars reports – actual and budgeted.
  • Budgets and drafts by area report, including monthly budgeted hours utilization tracking by individual.
  • Monthly hard costs spent reports.
  • Quarterly income target utilization score card to help determine appropriate rate of grant expenditures.

Another recent change is the establishment of quarterly reviews between the finance director and each budget manager. These reviews are meant to not only provide budgetary guidance and advice, but also to determine whether or not a program or project is on track based on current results, new or expiring funding, and/or changes in work plans. This shift to a culture of teaching and training within the finance area allows budget managers to better understand why their work is important and how the decisions made can impact more than just their program or project.

These are just a few of the cultural and philosophical changes that we are experiencing today. Our strategic plan is a living document that will be a helpful guide forward as new challenges come before us. I look forward to the journey ahead.