By Christa Martin, Senior Vice President of Marketing at Partners in Leadership
At the beginning of every fiscal year, corporate leaders keep a close eye on their annual and quarterly goals, projecting expenditures and revenue into the future and setting benchmark cash flow forecasts. And once a strong budgeting strategy has been established, leaders need to ensure that every employee is on board. This buy-in--exemplified by high levels of organizational accountability--is necessary to ensure the successful execution of any budgeting strategy.
Maintaining high levels of workplace accountability can not only keep an annual or quarterly budget on course, but can also guarantee the high performance of an organization. Read on to learn why accountability is the keystone of successful budgetary compliance -- and how you can bolster accountability to boost results and ensure the financial success of your company.
How Low Accountability at Work Derails Effective Budgets
According to the New York Times bestseller The Oz Principle, accountability is the "personal choice to rise above one's circumstances and demonstrate the ownership necessary for achieving desired results."
If your team is consistently missing the mark on benchmark targets, failing to deliver at the speed and quality necessary to achieve desired results, or falling into a pattern of finger-pointing and creating excuses when things go wrong, you have a workplace accountability problem.
The consequences of low accountability in the workplace are multifold. If your team can't perform at a high level, you may be forced to sacrifice the quality, speed, or cost-effectiveness of critical projects. While you may be able to reasonably deliver on two of the three, you will not be able to deliver on all three counts effectively without employees who are unified around your organization's needed Key Results.
As a result of low performance, you will be forced to allocate additional resources to fill in the gaps -- throwing your predetermined budget off course. You may have to hire external consultants, secure more vendors, or waste time overcoming communication and execution problems in order to help your current team perform at a higher level. What's more, if you elect to hire additional talent or pay for external help rather than training your existing team, you hurt not only your budget, but also your leadership development strategy, since current employees will have fewer opportunities for upward mobility within the company.
How High Accountability Can Drive Budgeting Success
Teams that consistently demonstrate high levels of personal and organizational accountability reliably deliver results with quality, speed, and cost-efficiency. Not only do they always know who is accountable for delivering on what, but they have anticipated potential areas of cost overrun early. As a result, these teams naturally remain within the 3-5% of the budget that many experts recommend.
On accountable teams, when a potential problem arises, the need is identified early and the team proactively collaborates to solve the problem. For example, if a leader asks his or her team to respond to a competitive threat that is not on the company roadmap, team members will be able to quickly assess whether they have adequate time and resources to effectively fulfill the request. If they decide they do not have the proper skill set or enough bandwidth, they will feel confident in approaching the leader with a plan of action to secure additional resources in order to deliver high-quality results quickly and on budget.
Backed by an organization comprised of highly accountable teams, your budget will be able to withstand a variety of hurdles throughout the year, including increased speed to market and change fatigue. This is because highly accountable teams pinpoint stumbling blocks quickly, take ownership of these problems, develop creative solutions for them, and deliver on their promise to achieve critical results on time.
How to Build a Culture of Accountability at Work
How can companies achieve this level of accountability in the workplace and ensure they keep all projects on-budget for the duration of the fiscal year?
First of all, leaders must conduct regular culture/skill appraisals of all teams within the organization -- at least annually, if not biannually. These should not be approached in the same way as personal performance assessments; rather, these appraisals are opportunities for leaders to pinpoint disparities in skill sets based on company culture and accountability so that they can begin to close these gaps as soon as possible. After a cultural assessment, leaders should have a clear picture of the areas in which low performance likely indicates a lack of accountability.
While many are inclined to view accountability as a natural personality trait or a "soft skill", accountability is actually a learned skill that demands training and discipline. As such, it's crucial that leaders allocate adequate resources for accountability training to ensure their workforce is accountable for and committed to meeting budgeting goals throughout the year.
What All Successful Budgeting Professionals Know
Let's go back to the three elements of successful project execution: quality, speed, and budget. All three can be honored with an accountable workforce. Quality happens when a high level of accountability delivers promised results. Speed happens when there is a high level of resiliency and agility within an organization. And finally, budget integrity happens when communication, promised results, resiliency and agility all come together.
Evidence-based training that teaches the steps to positive, principled accountability (seeing a problem, taking ownership for solving the problem, proactively developing a solution for the problem, and delivering on promised results) allows leaders to successfully build a culture of increased accountability -- and thus, stay on budget.