City of Tempe's Performance-Led Budgeting Team.

AuthorLudwig, Katie

In 2016, the City of Tempe, Arizona, started down a path to connect its budgeting and strategic planning processes. Known internally as "performance-led budgeting," the initiative is entering its fourth year and is transforming the way the city approaches its financial decision making, according to three of the members of the city team responsible for implementing it. The performance-led budgeting process is a team effort involving the city manager's office, directors, and city staff throughout the organization.

The three team members participating in the interview--Rosa Inchausti, director of strategic management and diversity; Mark Day, municipal budget director; and Ken Jones, deputy city manager and chief financial officer--recently explained how the city implemented performance-led budgeting and how it is benefitting the organization.

Rosa Inchausti heads the city's Office of Strategic Management and Diversity, which leads the development of the city's strategic plan and then completely operationalizes it. The strategic plan outlines the city council's five high-level priorities and identifies performance measures to help advance those priorities. "Working with all 14 departments, we not only identify how to achieve those priorities, but also identify what we want to benchmark against in terms of a target," Inchausti said. "And then more importantly, we identify strategies for how to achieve that performance target. We have about 106 performance measures that help advance the five high-level council priorities. We then work with the budget team to help make resource allocation decisions with that data."

Mark Day is responsible for the administration of the operating and capital budgets for the city. To put the budget together each year, his position requires a great deal of coordination with executive management as well as with the operating departments. Day's office is also responsible for long-range forecasting; he and his staff produces two forecasts per year. In addition, his office monitors the budget and keeps tabs on the economy throughout the year.

The third person on the team is Ken Jones, who oversees the Strategic Management and Diversity Office and the Budget Office, in addition to all of the internal service departments, including Finance, Human Resources, and IT. The government relations officer also reports to Jones, and he has responsibility for the municipal utilities--the water, wastewater, and solid waste.

Together, this team has developed a system connecting the city's strategic plan to its financial decision making. In the process, they are also transforming the organization's culture from competition among departments for scarce resources to a more...

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