ClearPoint’s First Virtual Community Event: Strategy Driving Budget in a Time of Crisis

Our very own ClearPoint team and ClearPoint Community Advisory Committee led a discussion on strategy and budget in a time of crisis.

In ClearPoint’s first ever virtual community event, our own Laura Chandler and Joseph Lucco hosted a discussion led by the ClearPoint Community Advisory Committee. Moderated by Laura Mazur from Arapahoe County, CO, the Committee discussed how local governments are using their strategies to navigate and influence budget cuts during COVID-19.

They also shared best practices surrounding managing challenges with strategy during this time, as well as on engaging leadership and takeaways for the future. You can watch the recording of the discussion here. If you don't get the chance to watch the recording, here's a recap for you to read.

Getting Started 

Members of the panel included strategy experts and ClearPoint users Kelley Hartman, Innovation and Performance Manager, at City of Arvada, CO; Jaime Germany Terry, Department Quality Analyst, at Austin Resource Recovery; Ingrid Kindbom, Assistant Structural Innovation Manager, at City of Fort Lauderdale, FL; and Matt McKirahan, Senior Strategy Planning and Performance Analyst, at City of Raleigh, NC.

To prompt reflection and get some insight on the attendees’ strategy and budget processes, we posed a poll question in the webinar. First the attendees were asked to respond to the statement, “Prior to COVID-19, strategy and budget were tightly aligned at my organization”. 67 percent of respondents strongly or somewhat agreed. The second statement posed read, “Since March 2020, has this changed for your organization?” 35 percent of respondents said “Yes, in a positive way”; 35 percent said “Yes, in a negative way”; and 31 percent said no changes have occurred.

Question 1: If you are like most, you are planning on a significant budget drop due to COVID-19.  Have you had the discussion about how to make up that gap?  To what extent was your strategy able to influence that discussion?

Moderator Laura Mazur shared that in Arapahoe County, while each department has their own strategic plan they would consult for budget planning, the County does not have an overall strategic plan. Without any overall priority areas previously indicated, it has been difficult for the County to now decide where to make budget cuts. She describes how they are starting from the bottom and identifying what their priorities and goals are as a county so they can better understand and decide where to make budget cuts and what service areas need to retain funding.

In Arvada, CO, Kelley Hartman explained that they have a 10-year financial planning strategy, so anything added to the budget has to balance over a 10-year period. This keeps the organization focused on not overextending itself, which is helpful for example, during months like this past April, when they saw a 10 percent decrease in overall sales tax. With a more solidified strategic plan in place, Arvada’s budget process requires that everything requested through the budget must be tied to a city council strategic result or performance metric. They are currently using these performance metrics to evaluate where they can make strategic cuts, rather than cutting programs 10 percent across the board. With their budget so strictly driven by their strategic plan, Kelley says they are in good shape and do not need to make staffing cuts.

Jaime Germany Terry with Austin Resource Recovery shared that before COVID-19, her organization was trying to align to the City’s strategic direction, but that things have shifted a bit now. Since Austin Resource Recovery does garbage, recycling, and organic services, they are considered an essential operation and are operating as normal. They have needed to streamline some of their services and are expecting to see a slight decrease in revenue, but are allowing extra flexibility for their customers as these are difficult times for everyone. When they discuss the 2021 fiscal year’s budget with the budget office, Jaime is expecting to see some shifts but ultimately believes they will be able to make up the difference.

In Fort Lauderdale, FL, Ingrid Kindbom shared that they have a new strategic plan aligned with the budget and departments. Despite the fact their budget office has identified a $19 million revenue reduction due to COVID-19, they are using their strategic plan to guide how they are going to make up that gap. For example, while they will have to delay or abandon some capital projects and slow down hiring, no current staff has been furloughed or laid off. Ingrid also pointed out that they have even identified some savings from COVID-19, such as money saved from events the City had to cancel and fewer city fleets on streets.

Finally, Matt McKirahan from City of Raleigh, NC, shared that the City has a five-year strategic plan and each department has a three-year business plan. Normally, in January each department updates how their business plan is doing in ClearPoint, including any potential budget increase asks, which is then analyzed by the city manager and budget analysts through the lens of their strategic plan. This process was interrupted by COVID-19, but Matt emphasized the importance of creating a strategic mindset in your organization. Using a budget reduction strategy, they focused on three priorities: being able to present a balanced budget without a property tax rate increase, maintaining their workforce, and avoiding sole reliance on capital maintenance to balance the budget. While everyone is dealing with budget cuts, Matt shared that it’s all about making sure your organization pivots in a strategic manner that thoroughly evaluates consequences and still allows your organization to live up to its mission and values.

Q & A from the Audience

Q: [Referring to Arvada’s 10-year financial planning strategy] 10 years seems like a long-term financial plan; is there a shorter time recommended?

Kelley explained that though the process is often painful and difficult, City of Arvada is seeing it really pay off during these times. Though it may seem excessive during good times, Kelley emphasized that it has really saved the City of Arvada now, while other municipalities in the area are having to make many challenging cuts. This practice has been in place in Arvada since 2012, and while there were growing pains at first, strong leadership helped solidify this process. Kelley emphasized the practice has really shaped who they are as an organization and been very advantageous. As Kelley said, there’s always room for improvement, but “the best part about local government is that we all share, poach, borrow, and steal good ideas and best practices [from each other].”

Q: Initiatives usually have connection to more than one priority, to a varying degree. What are the mechanics of or how do you go about assessing alignment with priorities?

Matt explained that when you have an initiative aligned to multiple priorities, things get complicated. For example, during Covid-19 how do you prioritize one thing over another? It’s tough! Matt’s recommendation is to outline what those priorities are, then try to map initiatives to the priorities. Some people do this by a point system, but it has to fit the way you manage. Laura Mazur shared that Arapahoe uses ClearPoint as a visual management board for their prioritization process. In ClearPoint, they can see which measures can be affected across the organization, and click into those to see how they’ve changed in relation to the initiative.

Q: Matt, you spoke about seeing communications to underline the soul of the organization. How do these outward facing communications inform your internal strategy budgeting process? Are communications being used to gather information from the community or to shape internal policy budgeting and strategy?

The City has an annual budget survey which informs their strategic plan and key focus areas. They try to understand what the community is looking for in terms of resource allocation and priorities. This input helps move their budget proposal forward. Though COVID-19 has stopped the process of physically going into the community to get that information, they did still collect results online this year.

Q: What are some of the most critical or challenging hurdles that you’ve faced with keeping strategy at the forefront? How have you managed that and any lessons learned if you had to do it all again?

Kelley shared that it has been difficult to keep people focused on performance metrics and data entry. Though they have let daily data entry be on the back burner, strategy is definitely not. The City of Arvada also took a step back and looked at all their strategic results to make sure they are still relevant during this new normal.

Laura from Arapahoe agreed; data entry has been more difficult as people have scrambled to tend to some emergency matters or are facing fatigue from our new reality. However, reminding people to stay on top of keeping information up to date is important.

Q: How often does leadership discuss in or update the strategic plan with the organization? Who is involved or is it top down?

Though Arapahoe County doesn’t have a strategic plan currently in place, Laura explained they do have performance metrics that they are assessing. Their process now is that leadership has a monthly meeting where they discuss different performance metrics, and Laura says the approach is bottom-up. They invite the program owners to come in and present on the metrics, who are the people “on the ground” with a full understanding of the data and what stories are behind it. Leadership provides input and sometimes measures get tweaked, added, or even eliminated.

Jaime explained that at Austin Resource Recovery, they meet less frequently, but rather do a business planning session where they look at all the measures and based on performance, assess whether they should keep tracking a measure or eliminate it. With everything going on now, they have had to pull back some new requests for their leadership team and wait until they are able to strategize and collect more information/feedback.

Matt shared that the City of Raleigh meets monthly to discuss their six key focus areas. In addition to a core team that meets, there is also an assistant city manager in attendance. In addition, there are initiative teams made up of employees around the organization who join. Each month, the core group discusses if they are meeting certain objectives or if they need to pivot. Every six months, they have a check in with the City Manager and have a robust conversation about what’s been accomplished in the last six months, as well as the direction for the city moving forward. Matt said this depends on what strategic approach your organization takes; some are much more operationalized and others are looser, which will make the way you approach meetings with leadership different.

Finally, Kelley shared that Arvada hosts a City Council retreat with leadership every January where they discuss information from customer surveys and public engagement. During this time, they refresh strategic results, give updates, and delete anything that is no longer valid. Quarterly, they have base camp meetings, during which they talk about their strategic results tied to work systems and allow the system to tell stories about what’s happening. This last month, they held their first Zoom base camp meeting and were focused on COVID-19 and how their team members are responding to it, including any challenges and opportunities they’re facing. The City of Arvada also uses a community dashboard in coordination with ClearPoint that publicly displays all their strategic results and performance measures, which are all informed by community survey priorities. Finally, their leadership team also meets monthly to discuss strategic results and performance metrics.

Q: Arapahoe County, what are examples of your performance metrics?

Laura shared that their performance metrics fall under three goals: service first, fiscal responsibility, & quality of life. Under ‘service first’, one measure is education and outreach, which measures how often the County has contact with employees to educate them on various programs and services that might be applicable to them. There are quarterly targets for this, and they set their target to be realistic but challenging. Under fiscal responsibility, one is ‘process improvement’, which measures the number of projects the County is engaged in and what percentage are hitting their targets. Under quality of life, ‘traffic congestion’ is one the County is working on improving.

During the pandemic, the County is looking more closely at performance metrics now to see which are helping them make decisions. Some of them might be eliminated whereas others they are tweaking to make more applicable. Even before the pandemic, they took the time to evaluate these regularly. Laura emphasized they try to have a bottom-up approach as well by asking departments and people with boots ‘on the ground’ for their input.

Q: Can you share your new COVID-19 strategic result in Arvada, Kelley?

Kelley explained this new strategic result looks at recovery. The milestones have to do with financial/fiscal recovery, physical recovery, and service recovery. Arvada found this really important as their strategic plan is a living document that shows where they are currently, and they needed to be able to address what was happening and how things are going to change as a result of the pandemic. This new strategic result will go to Council for approval, and assuming it’s approved, will then be added to their community dashboard.

Q: For those with a strategic plan for setting priorities, allocating resources, and focusing employees - how do you go about selecting projects that allow your organization to achieve the strategic plan?

Ingrid shared that they have an annual goal setting session followed by a retreat, where resources are aligned between projects and goals. Held in the beginning of the year, this gives them enough time to create new initiatives and ensure they align with the budget. They are prioritized based on the strategic plan and long-term goals. Overall, this allows them to be active in their strategic plan so as to achieve it.

Q: How can we do better? What is one piece of practical advice you can give on the panel today?

Laura: Force your organizations to have the tough conversations. She says that Arapahoe County did not do this prior to COVID-19, and it shows. If you don’t, she warns, questions will come up later and impact your ability to execute strategic plan.

Kelley: Stay strategic. It’s easy to operate in crisis mode and in some respects you have to, but the more you can take a step back and look at decisions and actions in a strategic manner, the better you’re going to come out on the other side. Arvada is tracking everything they’re doing in the projects portion of ClearPoint so they can look at the decisions they made, the actions they took, and have a strong understanding of why they did that at a strategic level instead of just being reactionary.

Jamie: Have a strategic plan in place so you don’t operate as though the sky is falling. Though Jamie is part of the quality assurance team and not part of finance team, they partner together in how they manage performance metrics that directly tie into the budget and making sure they are aligned is key.

Ingrid: Stay on the path and be very, very concise with your communications. I think communication has been one of the challenges on all levels, not only within the city but within the county, state etc. Make sure you have a deliberate communications plan in place.

Matt: It’s okay under the circumstances to find yourself reactive at first, but you need to get back to what drives you forward and your strategic directives within the organization. It’s ok to have lessons learned and to keep figuring out the best path forward.

One lesson Matt has learned from ClearPoint is to document the decisions, not just performance metrics. The quantitative information is vital, but the qualitative documentation of how you’re making these decisions and why is key too. At the end of the day, make sure your organization comes back together to share what worked and what didn’t; you will be better for it by sharing the information in a real, honest way.

ClearPoint’s First Virtual Community Event: Strategy Driving Budget in a Time of Crisis