Exercising financial leadership in the 21st century.

• Author: Riordan, Timothy H.
• Position: Editorial

When historians write about this period 50 years hence, they will talk about a period similar to the start of the industrial revolution. They will view it as a period in which major discontinuities in the normal way of doing business occurred and caused innovation, dislocation, and a rearrangement of winners and losers.

The winners and losers will be individuals, organizations, communities, and companies. As participants in these major events, we do not always clearly see them that way. Today does not look that different from yesterday. Tomorrow will be only slightly changed from today. The forces of technology, knowledge, and money will continue to change the way public finance professionals do business.

The successful financial leader of the next 20 years will demonstrate time-tested personal characteristics and use those characteristics to manage the four major forces affecting public financial management.

1) Character. The first requirement for successful financial leadership will be strength of personal character. The values and virtues of honesty, integrity, trust-building, and common sense have always served financial leaders well. They will continue to serve as the cornerstone of financial leadership.

2) Technology Skills. The second challenge for a successful leader will be to harness the raw power of computer and telecommunications technology. Technological change has influenced the finance field for several generations and it will continue to influence it. The challenge becomes harder as the technology becomes more powerful and benefits of productivity improvements become more significant. Successful use of technology can cause significant differences between winners and losers. But the real productivity gains are yet to come.

3) Economic Development Skills. The third challenge for the successful leader is the understanding of the shift to the global marketplace. Global markets, the easy movement of capital, and the rapid spread of ideas are changing the economic playing field throughout the world. The rearranging of economic reality caused by these forces affects communities and their economic and revenue base. This changing reality will pull the finance professional out of the comforts of city hall into the more uncomfortable and changing external world of economic development and deal making. Many finance professionals already work in this zone, but that part of the job will only grow.

4) Human Resources Skills. The fourth challenge to the financial leader will be the significant competition for recruiting and retaining quality people. Technology will decrease the number of people needed and change the nature of their needed skill base. The global economy will change the sources of people available to work for the community. The...