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A question for all you experts- What is the best way to link our city budget with the Balanced Scorecard Objectives on our Strategy Map and associated Strategic Plan? It would be great to know how our revenues and expenditures relate to our strategy map- both for understanding how our finances connect with our focus areas, but would also be very helpful as the executive team updates our plan to reflect our priorities for the upcoming year. And while I am really interested in examples linking city budgets and city level balanced scorecards and strategy maps, other nonprofit examples would be great too! |
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John, A simple way to do this would be to look closely at your strategy map and attempt to do some basic Activity Based Costing (I know this suggestion is butchering the phrase, but I use it for simplicity purposes). For example, if your map has three themes in it, you should allocate your budget by where the expenses are supporting the themes. Thus if someone is working on city services, link them to a specific theme, and if someone is working on finances, link their salary there. Where there is no clear linkage or someone truly is supporting all three themes, then just split their cost evenly. If you can do this simply, then you will see how your budget is supporting the strategy. Other organizations will take their flexible spending in their budget (for projects and initiatives) and then align that by theme and show how they are spending their flexible dollars on the strategy. This is typically less than 15% of a budget. I find this a cleaner and more defensible approach to linking the strategy and budget, but I wanted to give both options. |
