Fiscal Discipline

May 1, 2018

 

My 35 years in the Air Force offered me different perspectives on fiscal discipline.  On my first deployment to a warfighting exercise our entire squadron (Maintenance, Operations, Admin) had to share a very small number of vehicles – most of them were AF vans; there was an additional small number of rental cars. I’m certain there was some arcane formula that allocated vehicles based on how many people were deployed but I can promise you it did not factor in mission requirements.  We were all on different schedules, staying in different lodging, trying to get from our squadron area to the flightline, access to meals, etc.  Eventually, a few of us chipped in personal funds to purchase “our own” rental car in an effort to offer more options to accomplish all of our tasks.  It was a classic representation of an organization trying to save every dollar it could – and putting mission accomplishment at risk.

 

Much later in my career I oversaw multiple budget exercises in which we attempted to balance requirement against available funds…basically the same standard that was applied during the example I just reflected upon.  Now I was the one making decisions on what made it above the line and what fell below.  When I was at the Pentagon we were discussing programs worth hundreds of millions of dollars.  As the Vice Commander of US Air Forces in Europe, it was hundreds of thousands – but no less complicated a process.  I never forgot my experiences as a young officer and sought to prioritize mission success over “stretch the dollar”.  I wasn’t trying to pad budgets, but I never wanted mission success to be jeopardized in an attempt to fund “one more item”.  Here are a few thoughts on how your own organization might benefit from that approach.

 

  1. Prioritize your requirements based on your mission…and that probably changes every year. That sounds trite but I was continually disappointed to see items in a budget that were there simply because “that’s what we did last year” or “we’ve been trying to get this funded for several cycles”.  Times change and that usually means your mission changes as well; your budget should reflect those changes. Don’t accept a hastily prepared, lazy submission to an annual budget.  It’ll lead to an inefficient application of your limited resources…and your folks will know (and suffer).

  2. Make your subordinate departments defend their budgets.  Pick an amount (your amount will vary based on the size/budget of your business) above which every expense gets listed and a short defense is submitted.  I’ll admit, I was vigilant about scrutinizing the lists and asked the staff tough questions about items that didn’t make sense to me.  Sometimes it was simply a matter of poor writing – not explaining the need well enough on paper – but there were more than a few times when the defense simply didn’t sway me as I tried to prioritize the requirements of the entire organization.  If you’re not paying that kind of attention you run the risk of funding things that really aren’t adding to mission success.

  3. Remember the impact your decisions make on your workforce – and their commitment to the mission.  I can’t tell you how many times we “ran out” of copy paper, printer ink, pens, or other admin supplies we needed to get the job done.  Inevitably I’d go purchase something on my own, but each time I did it reminded me that someone above me seemingly didn’t care enough to give me the supplies I needed to do the job they assigned me.  In retrospect, that was narrow thinking because I have no remembrance of what kind of fiscal straits we were in, but it’s a reasonable conclusion for a young workforce who are not trying to solve organizational budget challenges.  Don’t squeeze your folks so tightly that they lose their commitment to success.

 

Bottom line: organizations mirror leadership.  If you show attention to the budget process, so will your workforce – they have to. Prioritize your critical items and align them with mission success.  Trying to stretch the budget too far winds up with 6 people trying to fit into a compact rental car.  I’ve been there; you can do better.

 

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