I spent the afternoon yesterday with one of my favorite clients going over budget reports. There must have been 6 or more reports we reviewed about their programs, everything from income statements to balance sheets. There were sub reports, special project reports and even service metric data to review. We were able to interpret all of it but towards the end of our meeting, I commented that the data was “informative but not really helpful” for the team to improve the management of their department.
Part of the reason for that may be due to the fact that the reports are geared to meet the finance departments requirements for reporting or that the team I was working with does not know what they need or how to ask for reports that address specific questions they have such as costs per site where production is done (which was not a report that was available).
So here are my top 3 quotes you will hear from staff that the data you receive my be informative but not particularly helpful.
- “So what does this budget report mean in terms of how we can improve our services.”
- “We get these reports every month but then we are told that they are just make believe because we are so far off from our actual budget.”
- “Can we get together with the CFO so that he/she can explain this to us and what it means to our department?”
Now before we beat up on the finance department too much, we should recognize that many staff are not budget savvy but I would probably build the case to say that both parties should meet half-way and that is where the use of dashboard reports with red, yellow and green markers can help point out where things are going well or poorly. Taking that information and then translating it into actionable steps is often times where the gap is the largest. So in order to improve the friendliness and usefulness of reports, I encouraged my colleagues yesterday to take 3 actions:
- Review and write down the questions they have about their budget report so we can make sure everyone understands what the data means.
- Think about the challenges they have with their program and see if there is some indicator or marker in their budget report that supports their perception…It could be that turnover of staff is high and that they are 10% below a full staff…or that the programs with the weakest leadership are the programs that are performing poorest financially.
- Come up with 3 steps they can take to better understand and address specific actions related to the interface of their budget and program information.
It is an art and skill to learn how to use data and reports effectively. Oftentimes, people in the field are not exactly sure how best to data but it really begins by looking at both the data and the programs and look back and forth between each to help find explanations for successes and opportunities