Data data all around, but not a bit that’s useful

It’s that busy time of the year for people in finance in local government –  ‘close down’.

A magical time when every last ounce of energy goes into the exercise.

There is a target date to meet and everything must add up, balance and be filed for inspection by the dreaded external auditor.making efficiencies

Life and death for accountants: like watching paint dry for everyone else.

During ‘close down’ it’s very difficult to get any useful information out of accountancy, as they are ‘too busy’.

So whilst the business goes on spending millions of pound a week managers run blind on what’s actually happening with cost, until they get an update at the end of the quarter. That’s when the fun starts again.

One persons view of a budget and spend profile is different to another. As the manager of the budget you often have limited say in what get reported to the many meetings that purport to scrutinize the detail only to nod it through.

It’s claimed that only the accountants really understand what the figures mean. In practice I wonder if even that it true.

The slight of hand that goes on to churn money in the system means that it’s difficult for anyone to know what the true picture is. By the time it gets reported, and audited the game has moved on.

Every year as a manager you do you best to manage and profile your spend to get value for money.

Now let’s not get started on VFM that will come up in a later blog.

A while ago in quarter two I was told that I was going to over spend by the end of the year by £2M (I was naturally quite worried) at the end of the following quarter I was going to underspend by £550K (now I was even more worried, did anyone know what was really going on?)

You could not make it up. What are you supposed to do!

Experience says keep your own information, so most of us keep our own spreadsheets just in case. They obviously sit outside of the main financial system, possibly even on memory sticks, but don’t tell IT as its against the policy to stick anything dodgy into your USB port.

At least having your own records gives you something to argue with when the accountant tries to manage your codes and your budget for you, and gets you in to hot water.

Ironically the latest accountancy system was introduced to remove the need for all those spreadsheets, but I am really glad that I secretly kept mine. It’s duplication of effort, but you cannot be too careful.

Another thing that bugs me is that fact that you are accountable for the budget and its spend, but the accountants mysteriously have secret powers to enter the system and move numbers around, seemingly at will, to balance things out for that all important financial report.

Overspends of course remain the managers problem.

This can be hugely frustrating when the overspend is cause by a cock up in accountancy when a Zero or the comma in the wrong place. Opps sorry these things happen!

Can you give me an explanation of the reasons for the overspend, and what you intend to do about it for the Management Team report. Oh and by the way the Director of Finance needs it by tonight.

The irony is that the budget is pored over and used as some amazing tool that informs our decision making.

In truth it’s a lagging measure, historical information regurgitated at various meetings to show everyone that we are in balance for the year against the agreed allocation of spend.

This whole exercise is an arbitrary judgement made largely on the basis of rolling forward previous years spent plus or minus a percentage.

It has little relationship to community or customer need, and gives us little if any information about true end to end operational cost of the services being delivered.

Why?  Because budgets are apportioned to hierarchical structures and further subdivided into functions and cost centres causing the system to sub optimise.

In practice this means that individuals manage the money that they have been allocated and spend it on the part of the organisation for which they have responsibility.

Simple really.

The issue is that each of us looks after our bit and has little, if any, focus upon the impact this has upon the customers that we are all here to serve. This in fact drives massive inefficiency and therefore cost into delivering essential services.

The result is that the organisation runs very inefficiently, but few people realise that this is the case because they are focused on their bit. The drive for efficiency only compounds the problem faced by many organisations.

Salami slicing or prioritisation of spend via a lottery causes individuals to act in a territorial way to protect spend in their area. It’s human nature.

The true cost of the system is in the flow – how things actually move around the organisation, not in unit cost.

Only by studying the organisation as a system can you begin to understand where and how to act to improve service and reduce operating cost.

Confessions of a public sector director

I have missed my deadlines!

I should have completed all my end of year reviews by the end of last month.

I am late putting the final touches to my business plan, and the performance team wants to know the reasons why my numbers were down for quarter 4.

It seems to be getting harder each time. The last management review removed three of my colleagues and I inherited two extra reports to go with the six that I already have.

The performance objectives that had been set for the new guys have been passed on to me together with the outstanding objectives from two of the managers that did not survive the last jobs cull.

Everyone seems to me to be trying really hard, but according to the latest guidance from HR I need to score three of my team as under performing. This means that they will miss out on a bonus, and I will have to fill in a detailed improvement plan with each of them, which I have to monitor on a monthly basis.

If I fail to do this then my boss will put me on to an improvement plan! I am drowning in paperwork; well I tell a lie some of it is paperless.

We have a new on line web based portal to update our performance metrics on each week.

Honestly I spend more time staring at my computer screen up dating forms and scorecards than I do actually trying to do my job. Is this what I joined this business to do? I talked down the pub with a few of my mates and they mainly seem to be caught in the same trap.

The end of year reviews are all based on the revised competency framework, revised again this year by HR, and also have to link into the business plan targets for the team.

Mine are linked to the team and to my boss, and so on.  It’s a maze. I am not sure that anyone really understands what it all means.

The online guidance and video blogs don’t help much with explaining what we need to know, I just need someone to talk to in person, but the HR team now operate out of a contact centre 400 miles away.

The game at the end of the year is to come up with smart words to show how what we ended up doing looks like it fits with the original plan. I have become pretty skilled at making things look ok.

In truth what we actually do and what we put into the plans are very different, but as long as the right boxes are filled in and we can come up with a sensible reason why we missed target we can usually get away with it.

What a way to run a business!

I sometimes wonder whether everyone is up the same trick? Is the MD also spinning the numbers with the board? He must be! As long as the board is happy then we live to breath another day.

As for this years business plan, well everyone else seems to be rolling forward last years ideas and adding a bit at the margin on performance targets.

You have to do it to survive, but it feels like cloud cuckoo land to me. It feels more and more like a losing streak when betting on the horses. A few of my colleagues have let all this get to them and it has starting to impact upon their home lives.

One of my colleagues had her longstanding partner walk out on her the other week, because she was hardly ever at home. The culture of presenteeism means that we have to be seen to be at work crunching the numbers.

Two of my colleagues are off with stress, and I am not sure that one of them will ever come back. Maybe it’s for the best, at least he will end up with some sort of deal to keep him quite and the company out of the courts!

I have to sit down later this week with one of my reports,  to talk to him about his performance this month.

It’s going to be a difficult conversation you see because he is very good at his job and brings in great results; in fact he is ahead of target. The problem is he is ahead on the wrong target.

Let me explain a bit further – the powers that be have decided that we need to review ten clients a day, and this is the target that we get measured on.  Well Alan has only been hitting around five a day for the last three months, so things are not looking too good for him.

The problem is that he has actually converted more of his reviews in to new business than any other member of the team, but the other team members regular hit their target for reviews.

How can I explain that one to him? The business needs new business to survive, but the target is for numbers of completed reviews. The big bosses don’t seem to realize the implications for the business.

I wonder if it has anything to do with the bonuses they are due at the end of the financial year?

However, I am not sure that it has to be this way. I was reading an interesting article the other day by a chap called John Seddon. In it he talked about that fact that targets always drive the wrong type of behaviour in organisations.

When I reflected upon my own experience I could see what he meant. He also argued that business planning, and annual performance reviews were a waste of time and energy. Well I agree with him there! He argues that such processes are entirely arbitrary and add no value to the business what so ever.

So, why I am finding myself having to doing more and more of this stuff?

The article says that as a manager I need to connect with the work and my team and to understand what my team is about through the eyes of the customer and then to work with them to design and manage the work on the basis of what matters to the customers.

It sounds simple enough; I would love to find the time to have a go.

Thanks for taking the time to read my blog.

Welcome to themushroomfactory

I started blogging a couple of years ago as a way of expressing my views about leadership, organisations, and my experience as a consumer of services.blogging-image

My blog aims to be a reflection of what I have learned so far about leadership and management, both as an operational leaders and as a result of working with others to help them on their own journey.

I have come to realise that most of what we get up to as organisational leaders does in fact get in the way of good performance, Inhibits innovation; and adds cost to the business.

Above all it often means that the customer/service users suffers as a consequence –  not that we would ever admit it, or in some cases even realise it.

Indeed many of us would not even realise that what we do as leaders actually has a negative impact.

There will be lots of performance data around in the organisation to show how well we are doing. Such information will be used to justify our strong performance in plans and appraisals.

My blog aims to reflect upon the impact of mindsets and behaviours in the work, and expose some of the myths about the impact of leadership and management as I see them.

Hopefully, this will encourage others to comment or start to blog themselves. I am learning as I go!

We help individuals and teams to purposefully reflect upon their current challenges, and identify practical and pragmatic ways of getting balance back into the demands upon your life, and delivering positive results in life and work.puzzle solved

Our one to one support will help you to cut through to the nub of your personal, and organisational challenges and help you to facilitate a way forward that will give you: –

  • Clarity around the key business issues that you are facing and a clear plan to tackle them
  • New capabilities, and capacity to meet future challenges 
  • Greater personal job satisfaction
  • Strategies to deal more effectively with difficult people or situations in your working life

To find out more about how I work with leaders in organisations please follow this link to my websitehttp://philbadleyconsulting.com

Thanks for reading.