Recovery Leaders and Elected Officials

The popular image of a private-sector “turnaround” leader is one of a dashing, high-powered, highly visible executive. Such a person would run into trouble in most local governments because, as democratic institutions, local governments have a less centralized power structure. In a financial recovery, it is possible to have a “behind the scenes” leadership style - however, it is better and often necessary to have a hands-on and visible style. Below is a checklist for how the leader can be visible and hands-on while working cooperatively with elected officials.  

Make a personal commitment to work with and protect elected officials. This mindset will make the recovery leader a real ally to the elected officials rather than a potential political risk. Some tactics to help finance officers and elected officials work better together include:
  • Establish a five-year forecast and update it regularly (e.g., quarterly). Explain variations between the forecast and actual results. Strive for a dynamic forecasting process.
  • Have high level discussions of financial strategies as early as possible in order to learn of concerns about a given strategy and begin shaping more specific strategies. The strategy development process with elected officials is often gradual and organic.
  • Give credit for ideas and recognize constructive suggestions from participants.

Alter politics. Noted authority on government reform, Bill Eggers (et al), recommends developing political mechanisms that create shared decision-making for hard choices and sharing of the resulting blame and credit. Some of his recommendations include joint committees to evaluate proposals for cost-cutting and revenue enhancing strategies, independent “blue ribbon” committees, and priority-driven budgeting.

Leader Image
Show that it is not all pain. Eggers (et al) also recommends showing benefits from the recovery process and strategies besides just financial benefits. For instance, perhaps changing the way a service is delivered will improve services. Eggers points that at least some on-going savings could be used for one-time infrastructure investments or to cut taxes.

Develop and adopt financial policies. Financial policies set the baseline standard for financial stewardship and crystallize the strategic intent for long-term financial management. Financial policies are a great way for elected officials to exercise governance and clarify expectations for staff. Some important financial policies to consider for recovery include:
  • Fund balance. Define the target amount the government believes it needs to hold in reserve to mitigate the risks it is subject to, such as extreme events and natural disasters and revenue fluctuations and cycles within the year.
  • Debt burden. Define the level of debt the government is willing to take on, both in terms of impact on the government’s budget and in terms of affordability to the community.
  • Fees. Define the extent to which services will be subsidized by general tax dollars. For example, public safety will likely be heavily subsidized, while recreation may be much less subsidized. This helps identify where fees and costs are out of alignment.
  • Long-term financial planning. Commits the government to taking a long-term perspective on financial strategies and guards against reliance on strategies that have short-term benefit, but long-term costs.
  • Performance review. Commits the government to regularly and systematically examining the way in which it provides services and the reasons behind providing the service.

Don’t play the blame game. This only makes others defensive and reduces their receptivity to new approaches at a time when new approaches are sorely needed. Especially when there is fear of blame at a public meeting, all participants will become more defensive, thereby slowing progress towards the goal. The CEO and finance officer must model this principle at board meetings and may need to work with elected officials to come to an agreement for everyone to live this principle.

Engage elected officials in the solution.
Listen carefully to elected officials and reflect back to them recommendations that incorporate their own good ideas. Take their good ideas and work those into the recovery strategy, and give credit where it is due. Soon, the recovery strategy will become everyone’s strategy.

Help elected officials deliver key messages. Elected officials are the organization’s natural leaders in the public’s eyes. Assist elected officials in filling that role by supporting them with background information and helping them deliver key messages and describe solutions to public. Provide elected officials with simple charts and easy talking points regularly. Look for the messages that elected officials want to take to the public and prepare them to deliver these with concision and accuracy.

While the staff leader may have a more visible role inside the organization than outside, elected officials should still have an important role in communicating with the employees. Many of the same ideas apply to helping elected officials deliver key messages to staff.

Create roles for elected officials in the recovery process. Elected officials have a unique set of skills. Find a way to use those skills in the recovery process. For example, elected officials can provide a perspective that differs from staff’s when developing recovery strategies, can provide input and feedback on strategies as they come together, develop policies to guide recovery (like spending limits), work with the media, and recruit expert citizens to advise the government.

No surprises.
No one likes unpleasant surprises, least of all elected officials in a public setting. Use private or one-on-one meetings with elected officials to give bad news in advance of it going public. If staff and council have worked together closely throughout the recovery process, then individual meetings can be used to inform elected officials of new information, rather than to “sell” any particular recovery strategy or policy.

Go on to Communication 

Return to Step 10 - Recovery Leadership