All tribal governments are faced with the same conundrum – provide more services with what seems to be shrinking or stagnant federal dollars. The situation can be further stressed by either a lack of, or dwindling funds from enterprises. Gaming profit distributions that were once projected to grow in perpetuity are now slowly shrinking away with increased competition.
Tribal Governments Must Focus on Lower Costs Through Increased Efficiency
Lowering costs is the one of the most viable options that will allow tribes to sustain their program budgets and maintain or increase service levels.
For most tribes, a primary impediment to lowering cost ties back to antiquated IT systems. It’s not always obvious how outdated systems are a source of lost revenue. Limitations of the system can require numerous, manual activities because they do not communicate with other systems causing redundant data entry, causing both time and money to be wasted.
To survive and flourish, forward-looking tribes must transform their operations to lower their cost and adapt to the changing environment. Replacing those old, limited computing systems can result in significant cost savings and more robust access to crucial data. Greater access to crucial data means more effective management and better stewardship of funds.
Start with the End in Mind
Caution: don’t optimize sub-optimal processes. What do we mean by that? Technology might not be the only problem. Another impediment to lowering costs may be (and frequently is) inefficient processes and workflows. Investing in the automation of inefficient workflows isn’t the best solution. The savvy CFO understands that optimal best practices executed with the latest technology is preferable to throwing new technology at sub-optimal processes.
You must ask yourself, where are we today and where do we want our tribal operation to be going forward? The ideal solution involves leveraging the right technology, but it also involves designing and implementing best practices. At JOSEPH EVE we call this holistic approach “Finance Transformation” – a phased approach to ensure that your tribe has the best of all worlds – the best financial practices, the best workflows, and the best technology.
A simple summary of our formula is:
Current State + Assess + Institute Change = Future State
What are your goals? Another way of asking the question is, “What would you like your Future State to look like? The finance function of your organization should be run as a carefully mapped process with clarity of vision. The JOSEPH EVE Finance Transformation process can help you define these goal and then select and implement the software solution that will best help you meet the objectives of your goals – accelerate the journey to your better Future State.
The key to finance transformation for Tribal Governments is a phased, circular, on-going approach.
We’ve seen the best results involve a cycle of six phases of actions (along with a plan to revisit the cycle on a periodic basis to re-assess, refine and deploy in order to maintain an environment of continuous improvement).
In this phase each and every process is documented in both a narrative form and mapped out in a flow chart. This provides you with a complete view of current activities and the reason, underlying motivation, or objective for each activity.
Phase 2: Analyze and Evaluate
Once your broader value stream of current activities and their objective are defined, the next step is to compare them against industry best practices as well as the framework of internal controls. At this stage, activities are categorized as “value-adding” or “non-value adding”. The purpose of this phase is to identify the improvement opportunities for your department and organization to achieve greater efficiencies.
Phase 3: Agree on Improvement Opportunities
Now that we have created a thorough, accurate picture and documentation of current activities, the process narrative, flow charts, and improvement opportunities, Phase 3 is the point at which stakeholders can view the presentation to validate and gain consensus.
Phase 4: Define and Map the Future State
The opportunities are then ranked by level of effort versus potential organizational value to map and define the future state. Now, there is a clear understanding of where your process is currently, what the future state looks like and the actions necessary to get there.
Phase 5: Implement Change
Working from the list of priorities and action items to reach the Future State, it’s time to begin implementing change. When possible, the “quick win” improvement opportunities are acted on immediately. For longer-term items, a project plan (with specific action items) is created and tasks are assigned to specific individuals.
Phase 6: Model, Deploy, and Document
New process and systems are tested to ensure future state goals are accomplished. New processes documentation is created and comprehensive training occurs.
What can you expect as you complete the six phases? Your tribal government can expect:
- Improved Quality – Increase the quality controls at the source of transaction to reduce re-work and increase compliance with applicable laws and regulations.
- Simplification – Reduce complexity and increase standardization of process and technology.
- Timeliness – Reduce wasted or sunk time and improve cycle times.
- Lower costs – The combination of better technology and improved processes will mean you no longer have to waste valuable time compensating for outdated system limitations by resorting to manual processes.
Fitness guru Jillian Michaels says, “transformation is not a future event, it is a present activity” and we couldn’t agree more. Whether it’s your individual physical fitness or the financial fitness of your organization, transformation has to begin with a present activity. It all starts with that first step in the right direction. JOSEPH EVE can partner with you to guide you at every stage of a Finance Transformation.
To take the first step in your transformation, give us a ring 406-752-5225 or Email Us.