1. Metro Washington GFOA Conference Washington, D.C. November 7, 2018
How to Build a Finance Office: Case Study in Organizing For & Sustaining Excellence
Metro Washington GFOA Conference
Washington, D.C.
November 7, 2018

2. Jurisdiction Snapshot
Population: 1 MM
Total General Fund Revenues: $2.9 BB
Total General Fund Expenditures: $2.8 BB
Number of Governmental Funds and Business Funds: ~30
Elected Executive/Council Form of Government
Decentralized operating environment

3. Start as Finance Director 7/2011 Post ERP Go Live 7/2010
Context for Change
Start as Finance Director 7/2011
Post ERP Go Live 7/2010
Best Practices and
Change Management
Emerging from the Great Recession
Position Cuts
Hiring and Procurement Freezes

4. Organization Background
Department of Finance
Information Technology
Cash &
Debt Management
Controller
Treasury
Risk Mgmt
Chief Operating Officer

5. Context for Change The ERP “Retirement Incentive Program” –
Over 25 vacancies out of 114 positions including key positions
Chief Information Officer
Debt Manager & Investment Manager
General Accounting Manager
ERP Project Manager
The CAFR will be late…really late
Reconciliation and Transaction Processing issues
Controller’s Division & ERP Office Communication

6. Assessment, Triage, and Planning
Establishing the Tone and Setting Expectations
Department Wide Meeting with Focus on:
Customer Service
Problem Solving
Collaboration
Identification and understanding of the issues

7. Assessment, Triage, and Planning
Assessment of Issues
Who are the customers: Internal & External
Meeting with Customers
Meeting with Managers and staff
Evaluating & Planning

8. Solution & Implementation
Solution: Re-staffing and Culture Change vs. Reorganization
Dealing with the “4 Masters”: Human Resources; Budget; Procurement; & Legal
Relationships and anticipating concerns
Looking for help in all the right places
Hiring: “No one reads the Washington Post anymore”
Don’t forget to “fly the plane”
Maintaining operations while addressing a crisis and
Making sustainable improvements

9. Case Study: Controller’s Division Reorganization
CHALLENGES
Implementation of ERP was a much greater change management and knowledge transfer challenge than anticipated
New and revised business processes: Cash Management; Bank; Reconciliations; Accounts Receivable; Supplier File Maintenance
Lack of reports at go live
Ongoing system modifications and stabilization, turnover in ERP and Controller’s staff
Communication between project office and “home office”
Changing GASB standards: Pensions; Fund Balance reporting
Existing staff levels not sufficient to maintain current on workload, close out funds, prepare reports, and adequately exploit full system capabilities

10. Case Study: Controller’s Division Reorganization
CONSEQUENCES
Material Weaknesses and Significant Deficiencies: Cash Management and Bank Reconciliations; Housing Loans; Journal Entries
3 Month Delay in CAFR Production
Disclosure Issues
Ongoing vulnerabilities with transaction processing
Delay in reimbursing General Fund for advances to the Capital Projects Fund and other activities
Staff Turnover/Retention
Highly competitive market for Accountants and employees with ERP skills
Morale and ERP Adoption
Failure to fully exploit reporting, analytical, and process efficiencies in new system

11. Case Study: Controller’s Division Reorganization
SOLUTION
Get the right people on the bus, the right people in the right seats, and….
(“Good to Great” – James C. Collins)
Staffing: Address gaps: skills; workload; vulnerabilities
Staffing where the workload and vulnerabilities exist with the right staff with the right skill set
Transition from heavy reliance on contractors to staff. Reduced costs and build up institutional knowledge and capabilities
Use contractors for special studies/business process reviews, time sensitive responses
Change the culture from complaining and reactive responses to problem solving, technology oriented, independent, and pro-active through staffing selection, leadership, and training.

12. Case Study: Controller’s Division Reorganization
WHAT SUCCESS MEANS
Clean Audits
Reduced SD & MW in next year and eliminated by 2013
Stronger, reliable internal controls for payments, cash management, other financial transactions
Instituted internal AP audits Conducted and implemented Treasury Risk Assessments
Exploiting system capabilities to implement enterprise wide improved business processes
Robust and timely enterprise wide financial reporting capabilities
Consulting and collaboration with other departments to improve financial analysis and understanding of County’s financial position & processes
“Roadshow”
Greater financial transparency
Reduced overtime in all Divisions

13. The Other Divisions
A similar approach was used for the other core Finance functions
Treasury: Cross Training and Documentation
Risk Management: New Third Party Administrator & improved audit results
Banking & Investments: Moved from Single Threaded to a full cross trained team
Debt Management: Build depth; Training; and support for transactions
Next step is improved communications and networking

14. Moving Forward
Identify the most critical needs as understood by the customers and understand what is needed to address the needs
Work through the bureaucratic process… just quickly and creatively
Look for the solution
Measure it and Communicate it
Tax Compliance Report
Small Business Report

15. Feedback and Continuous Improvement
Secret Shopper
Customer Service Survey
Reinforcing the Message
Communication with Managers and Employees
The Open Door
Periodic Staff and Management Retreats
Trusting Managers to take the initiative and take calculated risks in staffing changes and problem resolution

16. Transition from Crisis Management
Trusting Managers and staff to:
Take the initiative
Take calculated risks in staffing changes and problem resolution
Encourage & reward creativity, innovation, success