From control to collaboration ... finance shifts its focus.

• Author: James, Perry

Everyone would likely agree that the most successful organizations are those that see change coming and respond in ways that meet the needs and the desires of their customers. A recent example can be seen in the fast food industry. Many customers' fast-food consumption patterns were set when the first chain restaurant saw the public demand for electronic payment and put VISA, MasterCard, or other logos on its doors and drive-through windows.

While government finance offices have a different mission than do fast food restaurants, public sector organizations face many of the same challenges as firms operating in the competitive marketplace. The role of finance in achieving a public mission continues to evolve as the need for quick, accurate, and relevant financial data becomes a prerequisite for good decisions. The dilemma faced by finance professionals is how to be that type of responsive, continuously improving force while also staying on top of the compliance and control-oriented rules that have long characterized public financial management's objectives.

This article will compare a finance office whose traditional focus has been on transactional operations with the newer finance office that emphasizes decision-support capabilities. Through contrasting these approaches, the article will examine changes that a finance office has to consciously consider as it bridges the roles of control and collaboration to be successful in meeting the evolving objectives of public sector organizations they serve.

THE WAY WE WERE

To help understand how the traditional finance office is evolving in response to new decision-support needs, it helps to look at some of the roles that are now changing. The characteristics described below reflect the traditional finance office, which did a good job in meeting largely transactional objectives but did not have the ability to respond to rapidly expanding decision needs within the organization.

Fiscal Police

Over the years, many of our stakeholders saw the finance office as the "fiscal police" because of the emphasis on complying with financial rules and regulations. The rules often had negative tones to them, including references to what one could or could not do. As a result, it is not surprising that finance office personnel were trained in how to prevent those exceptions, typically returning paperwork that did not comply with the stated rules. In my own unit of government, as an example, employees at one point were equipped with preprinted check-off lists of reasons for rejecting documents sent to the accounting office. The lists were attached to any documents having errors and returned to the originating department for correction and resubmittal. Clearly, as we look back at that "return to sender" style, we see that it had negative implications for other roles of the department.

Information Custodian

As with anyone entrusted with something valuable, our finance office personnel often were trained that the finance office was the expert in dealing with the organization's financial information and, therefore, information was not to be shared indiscriminately As a result, financial reports were run only at set times of the month, were sent to personnel in other parts of the organization only on a limited basis, and provided little explanation. Concepts like fund balance, budget variances, and accrual accounting were understood by only a few higher level managers, even in the finance office.

Holder of the Purse Strings

Because the finance office was the information custodian, it followed that it also was typically the area in the organization that could...