1. The budget process will have been completed and hopefully it was more than just rolling forward the prior year. Many organisations will have forecast new revenue, possibly proportional expense growth, and possibly some expected savings. The challenge is how to achieve the budget. Too often we encounter organisations simply continuing to do as they have always done and therefore not achieving budget. To achieve a budget, particularly one that has significant changes, requires different actions to produce a different outcome. The old adage ‘if you change nothing, nothing will change’ applies here. Accordingly, target several key changes within the budget and ensure there are underlying actions to achieve the budget outcome.
2. Way back in March or April the organisation possibly undertook a strategic planning session. Ideally the strategic plan would have been summarised into a clear direction and set of goals. The question is how to achieve these goals? To the extent that the strategic goals are significant for the organisation, who is responsible for taking which actions to achieve the required outcomes? Now is the ideal time to take stock, ensure actions are progressing to bring effect to the strategic plan.
As a starting point:
- ensure the strategy has been communicated to the whole organisation and there is engagement
- prioritise the necessary actions or areas of focus
- allocate responsibility for aspects of the strategy, ensure those tasked with effecting the plan understand the aim, and are appropriately resourced (people, time, and budget)
- determine and agree reasonable milestones or gates to monitor progress toward the goals.
3. We often find the beginning of the new financial year is a good time to consider a challenge that will help the organisation evolve. The matter for consideration may not seem major or strategic but could be investigation of a matter that assists your team, a service line or something disruptive such as a review to challenge part of the organisation. For example, recently client undertook a strategic property review to assess their current property holding and organisational requirements with a view to resetting this aspect of operations. Other challenges may include researching the adoption of an outsourcing model, implementing AI or robot processing, or alternate uses for reserves.
4. The beginning of a new financial year is also the ideal time to disrupt historic financial reporting formats. It provides an opportunity to change the way information is presented without having to restate all the year-to-date work. Remapping of expenses, reconsidering the basis of cost allocation, inclusion of qualitative data are all more easily implemented at the beginning of the financial year rather than part way through the year.
5. Finally, there is a general housekeeping to ensure organisations are ready for concepts such as single touch payroll, if they haven’t already been implemented. There are also related matters such as full cost packaging to ensure that salary and wages costs, undoubtably the highest expenditure for Not for Profits, can be accurately controlled and measured. All too often clients are unaware of the full cost of employing a staff member and so do not implement such concepts for fear of knowing or offending anyone when there is accountability.
These are just a few thoughts for those who may be seeking to raise their eyes a little to the horizon and try to get beyond the usual year end grind.