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Fiscal Management + Accountability + Oversight: Adding Up the Effects in Public Agencies

A note for our readers: the views reflected by the authors do not reflect the views of ASPA.

By Tosha Wilson-Davis

Lately, cut backs, business closures and increased unemployment seem to be famous catch-all phrases, especially in the last five to seven years. With the housing collapse, automotive industry tumble and bank collapses of 2008, many public agencies, such as colleges and universities, federal government agencies, along with social services agencies and nonprofits alike have found that doing more with less is the new normal. This includes a smaller workforce with higher caseloads, which can be stressful for those on the front line—the employees.

We all remember the near failures of Fannie and Freddie Mac, the numerous bank collapses including Lehman Brothers and Countrywide Financial, along with the automotive industries’ financial wreck between General Motors Corp. and Chrysler— known as the notorious bailout. This was not only a wake-up call for citizens but also for top management in public agencies and CEOs of companies worldwide. The Great Recession of 2008, as it is termed, pushed public agencies to review their financial policies and oversight procedures and look for ways to institute some genuine changes, particularly in the areas of fiscal management.

Fiscal management is the key to creating and maintaining public agencies’ ability to stay competitive, to stay marketable and above all to stay afloat. Top officials such as executive directors and administrators of public agencies must employ specialized workers who have expertise in budget and financial management. Hiring the right people with a passion for moving the agency forward, particularly in the area of fiscal management, is crucial to the success of the agency. Edgar Schein, in his book titled, Organizational Culture and Leadership, elaborates on the concept of managers being in the business of “developing the right kind or culture or a culture of quality, suggesting that culture is concerned with values that managers are trying to inculcate in their organizations and the ‘right’ kind of culture will influence how effective organizations are.” It is also worth noting here that management must be involved in monumental, continuous and significant processes like budget creation and fiscal management that ultimately determines the fate and future of the agency.

Wilson Davis MayMoreover, accountability plays a major role in successful fiscal management and public agency success. The managerial staff is tasked with taking ownership of the good, bad and the ugly of the organization. They don’t just enjoy the success stories of the organization but also the failures and fiascos which may include disciplinary issues, high rates of turnover, decreasing budgets and allocations which in turn leads to their inability to provide the necessary products and services to customers and clients due to expected and unexpected economic constraints. As such, constant budget oversight and monitoring along with meaningful organizational evaluation is imperative to help minimize the effects of such issues and maximize the success of all public agencies.

CEOs and top management are usually the faces of public organizations and are accountable to not just the employees and the mission of the organization but also taxpayers, which is the case particularly in government agencies. Therefore, it is important for top officials to promote ethics, accountability and responsibility among all participants as the CEO along with other leadership personnel must provide continuous input and transparency. This brings us to yet another important aspect of establishing a successful public agency and maintaining fiscal management—oversight. In my opinion, oversight and transparency is top priority especially in terms of budget/financial management, employee productivity and client/customer sustainability.

Nevertheless, I cannot fail to mention that such oversight must include all of the agencies’ employees including top management, which is one aspect of transparency that is usually overlooked. The Bureau of Fiscal Service, a department within the United States Treasury Department, is responsible for carrying out this responsibility for federal public agencies as its government wide accounting program is tasked with “the critical responsibility of maintaining the federal government’s accounts, and serving as the repository of information about the financial position of the United States government. This agency closely monitors the government’s monetary assets and liabilities through its oversight of central accounting and reporting systems.”

Due to the economic and financial restraints, it has become a quandary in finding ways to make all employees happy with fewer incentives and less rewards. Because of this, it takes some critical and creative thinking on the part of management. In their 2008 book, Classics of Organization Theory, Shafritz, Ott and Jang discuss a concept known as organizational economics theory. This theory asserts that a “fundamental and universal problem of organizations is how to induce managers and other employees to act in the best interests of those who control ownership or, in the case of government agencies and nonprofit organizations, those who have the authority to control policy and resource allocation decisions.” In other words, getting employees to buy-in to the mission and intrinsic value of the agency without the expectation of rewards is key to successful fiscal and budgetary management, specifically for public agencies. This coincides with a very important public service concept, servant leadership.

In closing this column, the importance for top management to think both critically and creatively to ensure effective fiscal management and future success of their agencies must be reiterated. Doing more with less is the name of the game, especially with the economic crisis we have faced in the last six years. Since employees may not be enjoying their “normal” recognition in terms of monetary performance awards or other cash-like rewards, public organizations must look beyond their pocketbooks for satisfying their employees’ commitment to fiscal responsibility and the organization itself.

I would suggest some simple yet powerful implementations in asking public agencies to invest in those incentives that will produce long-lasting benefits for not only the employees but also the agency. Three top implementations include establishing professional development and training opportunities, creating that “right kind of culture” that Edgar Schein described in Organizational Culture and Leadership mentioned earlier, and above all encouraging employees to buy-in to the agency’s mission and objectives. With such implementations, public and nonprofit agencies alike will have a greater chance of sustaining the test of present and future economic uncertainties.

 

Author: Tosha Wilson-Davis is an adjunct professor of political science and faculty mentor at Georgia Military College. She is also an adjunct professor of criminal justice at Bainbridge State College. She has served as a faculty mentor for over a year at Georgia Military College and an adjunct professor both classroom and online for over three years. She is currently finishing her second masters degree in criminal justice at Troy University. Tosha also served as a former Civilian Contract Specialist (GS-11) for the Department of Defense at Robins AFB where she worked on several spares and services acquisitions, was selected to work a GSA Unique Large-Dollar acquisition and a Firetruck Overhaul Source Selection.  She was nominated for and received the Notable Achievement Award at Robins AFB in 2011 and a 10-Hour Performance Award in August 2013. She holds a Masters of Public Administration with a Government Contracting Specialization from Troy University and two Bachelor of Arts degrees, one in Sociology and the other in Criminal Justice. She has been an ASPA member since 2010. To contact Tosha, email her at [email protected] or[email protected].

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