D x V x F Rc

1
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
2
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 dont know where youre going, youre
  going to get there anyway Anonymous
• If you dont change directions, youre going to
  get where you are going -- Anonymous

3
Have you ever used an anonymous opinion gathering
device such as this?

• No
• Yes

4
Have you ever driven more than 30 MPH over the
speed limit?

• No
• Yes

5
Did you ever lie to Mom?

• No
• Well, it wasnt exactly a lie
• Yes

6
What is the role of the Budget Office?

• The non-budget person might say
• The budget office translates an organizations
  plans and policies into financial terms

Starting with this definition
How has the role of the Budget Office evolved
over the past 10 years?
7
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
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Change Model 1

• Pull Change

9
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?

• No
• Yes

10
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?

• No
• Yes

11
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?

• No
• Yes

12
Pull Change
Communicated
Accepted
13
Change Model 2

• Starting Change

14
Have you ever had a really messy office, garage
or closet?

• No
• It wasnt really messy
• Yes

15
D x V x F gt Rc

• Starting Change

enVision a Better Future
Resistance To Change
Dissatisfaction With Present
First Steps
16
Change Model 3

• Adoption of Innovation

17
Which of the following best describes you and an
Apple IPod?

• One of the first to buy it
• Bought one early on, but only after talking with
  someone who already had one
• Bought one, but waited until the technology and
  access to songs were proven
• Am still investigating buying one, but not ready
  yet
• Really have no interest

18
Budget AI is a new software product combining
artificial intelligence software with a national
local govt 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?

• Sign me up for the Beta version. I want it now
• It sounds great but let me talk with someone who
  has it up and running
• Show me that it really works in the real world
  and Ill consider it
• Not interested now, but send me updated
  information periodically
• Really have no interest

19
Adoption of Innovation
Chasm
Sources Everett M. Rogers, Diffusion of
Innovation, 1962 Geoffrey Moore,
Crossing the Chasm, 1991
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Change Model 4

• Grow or Die

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Growth Curve
4. Limits
7. New Early Growth
3. Late Growth
6. New Startup
2. Early Growth
5. Decline
1. Startup
Time
Source George Land, Grow or Die, 1973
22
Where is the China on this growth curve?
4
7
3
6
5
2
1

• Startup
• Early growth
• Late growth
• Limits
• Decline
• New startup
• New early growth

23
Where is the U.S. on this growth curve?
4
7
3
6
5
2
1

• Startup
• Early growth
• Late growth
• Limits
• Decline
• New startup
• New early growth

24
Where is YOUR Budget Office on this growth curve?
4
7
3
6
5
2
1

• Startup
• Early growth
• Late growth
• Limits
• Decline
• New startup
• New early growth

25
Change Model 5

• Linking Strategy to Action

26
Change Linking Strategy to Action

• WW

Where now
/Where future
WH
What
How
WW
Who/When
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Change Model 6

• Setting Priorities

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Focus on the Whats
Lets say you have developed a list of Critical
Success Factors (CSFs)the Whats that will help
you get to Where you are going

• Aaaaa aa aaaaa aa
• B. Bbbbbbb bbb bbbbbb
• C. Ccc ccc ccc ccc
• D. Ddddd ddddd ddddddddd d
• E. E eeee eeeeeee eeee
• F. Fffff ffff ffffff ff ffff fff
• G. Ggggg gggggg ggg gggggggg
• H. Hhh hhhhhh h hhh
• I. Iiiiiiii iii iiiiiiiii iiiiiii
• J. Jjjjjjjjjjjj jjjjjjj jjjjjjjjjjjjjj

How do you assess which ones are more important
how do you determine what to focus on?
29
Focus on the Whats
High
IMPORTANCE
Low
High
CURRENT PERFORMANCE
From Option Technologies Interactive, 1980s to
present
30
Assessing the Whats
High
Opportunities
C
Strengths
IMPORTANCE
F
A
G
J
Emergents
H
B
I
E
D
Maintainers
Overkills
Gripes
Low
High
CURRENT PERFORMANCE
From Option Technologies Interactive, 1980s to
present
31
Change Model 7

• Action Planning

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Focus on the Hows
Whats (CSFs)
Hows (actions)
C
F
A
G
J
H
B
Impacts

• Target key markets

2

• Engage in P.R.

1

• Train collections staff

2

• Install new equipment

1

• Install cost software

3

• Use cost information

4

• Reduce turnaround time

3

• Develop incentive plan

1

• Generate new ideas

1

• Determine what works

1
From Hardaker Ward, Getting Things Done,
Harvard Business Review, 1987
33
Change Model 8

• Creating an
• Adaptive Organization

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Which of the following would you prefer? Have
someone

• Tell you what to do
• Ask your opinion about what should be done

35
Organizational Change

• Traditional

• Participative

AUTHORITY
LEADERSHIP
MANDATE (Telling)
INFLUENCE (Asking)
COMMITMENT (Want To)
COMPLIANCE (Have To)
TIME
TIME ENERGY
PERFORM (Meet Expectations)
PRODUCE (Minimum Standards)
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Time
Universal