Best in Class Finance Functions For Police Forces

Background

Police funding has risen by £4.8 billion and 77 per cent (39 per cent in real terms) since 1997. However the days where forces have enjoyed such levels of funding are over.

Chief Constables and senior management recognize that the annual cycle of looking for efficiencies year-on-year is not sustainable, and will not address the cash shortfall in years to come.
Facing slower funding growth and real cash deficits in their budgets, the Police Service must adopt innovative strategies which generate the productivity and efficiency gains needed to deliver high quality policing to the public.

The step-change in performance required to meet this challenge will only be achieved if the police service fully embraces effective resource management and makes efficient and productive use of its technology, partnerships and people.

The finance function has an essential role to play in addressing these challenges and supporting Forces’ objectives economically and efficiently.

Challenge

Police Forces tend to nurture a divisional and departmental culture rather than a corporate one, with individual procurement activities that do not exploit economies of scale. This is in part the result of over a decade of devolving functions from the center to the.divisions.

In order to reduce costs, improve efficiency and mitigate against the threat of “top down” mandatory, centrally-driven initiatives, Police Forces need to set up a corporate back office and induce behavioral change. This change must involve compliance with a corporate culture rather than a series of silos running through the organization.

Developing a Best in Class Finance Function

Traditionally finance functions within Police Forces have focused on transactional processing with only limited support for management information and business decision support. With a renewed focus on efficiencies, there is now a pressing need for finance departments to transform in order to add greater value to the force but with minimal costs.

1) Aligning to Force Strategy

As Police Forces need finance to function, it is imperative that finance and operations are closely aligned. This collaboration can be very powerful and help deliver significant improvements to a Force, but in order to achieve this model, there are many barriers to overcome. Finance Directors must look at whether their Force is ready for this collaboration, but more importantly, they must consider whether the Force itself can survive without it.

Finance requires a clear vision that centers around its role as a balanced business partner. However to achieve this vision a huge effort is required from the bottom up to understand the significant complexity in underlying systems and processes and to devise a way forward that can work for that particular organization.

The success of any change management program is dependent on its execution. Change is difficult and costly to execute correctly, and often, Police Forces lack the relevant experience to achieve such change. Although finance directors are required to hold appropriate professional qualifications (as opposed to being former police officers as was the case a few years ago) many have progressed within the Public Sector with limited opportunities for learning from and interaction with best in class methodologies. In addition cultural issues around self-preservation can present barriers to change.

Whilst it is relatively easy to get the message of finance transformation across, securing commitment to embark on bold change can be tough. Business cases often lack the quality required to drive through change and even where they are of exceptional quality senior police officers often lack the commercial awareness to trust them.

2) Supporting Force Decisions

Many Finance Directors are keen to develop their finance functions. The challenge they face is convincing the rest of the Force that the finance function can add value – by devoting more time and effort to financial analysis and providing senior management with the tools to understand the financial implications of major strategic decisions.

Maintaining Financial Controls and Managing Risk

Sarbanes Oxley, International Financial Reporting Standards (IFRS), Basel II and Individual Capital Assessments (ICA) have all put financial controls and reporting under the spotlight in the private sector. This in turn is increasing the spotlight on financial controls in the public sector.

A ‘Best in Class’ Police Force finance function will not just have the minimum controls to meet the regulatory requirements but will evaluate how the legislation and regulations that the finance function are required to comply with, can be leveraged to provide value to the organization. Providing strategic information that will enable the force to meet its objectives is a key task for a leading finance function.

3) Value to the Force

The drive for development over the last decade or so, has moved decision making to the Divisions and has led to an increase in costs in the finance function. Through utilizing a number of initiatives in a program of transformation, a Force can leverage up to 40% of savings on the cost of finance together with improving the responsiveness of finance teams and the quality of financial information. These initiatives include:

Centralization

By centralizing the finance function, a Police Force can create centers of excellence where industry best practice can be developed and shared. This will not only re-empower the department, creating greater independence and objectivity in assessing projects and performance, but also lead to more consistent management information and a higher degree of control. A Police Force can also develop a business partner group to act as strategic liaisons to departments and divisions. The business partners would, for example, advise on how the departmental and divisional commanders can meet the budget in future months instead of merely advising that the budget has been missed for the previous month.

With the mundane number crunching being performed in a shared service center, finance professionals will find they now have time to act as business partners to divisions and departments and focus on the strategic issues.

The cultural impact on the departments and divisional commanders should not be underestimated. Commanders will be concerned that:

o Their budgets will be centralized
o Workloads would increase
o There will be limited access to finance individuals
o There will not be on site support

However, if the centralized shared service center is designed appropriately none of the above should apply. In fact from centralization under a best practice model, leaders should accrue the following benefits:

o Strategic advice provided by business partners
o Increased flexibility
o Improved management information
o Faster transactions
o Reduced number of unresolved queries
o Greater clarity on service and cost of provision
o Forum for finance to be strategically aligned to the needs of the Force

A Force that moves from a de-centralized to a centralized system should try and ensure that the finance function does not lose touch with the Chief Constable and Divisional Commanders. Forces need to have a robust business case for finance transformation combined with a governance structure that spans operational, tactical and strategic requirements. There is a risk that potential benefits of implementing such a change may not be realized if the program is not carefully managed. Investment is needed to create a successful centralized finance function. Typically the future potential benefits of greater visibility and control, consistent processes, standardized management information, economies of scale, long-term cost savings and an empowered group of proud finance professionals, should outweigh those initial costs.

To reduce the commercial, operational and capability risks, the finance functions can be completely outsourced or partially outsourced to third parties. This will provide guaranteed cost benefits and may provide the opportunity to leverage relationships with vendors that provide best practice processes.

Process Efficiencies

Typically for Police Forces the focus on development has developed a silo based culture with disparate processes. As a result significant opportunities exist for standardization and simplification of processes which provide scalability, reduce manual effort and deliver business benefit. From simply rationalizing processes, a force can typically accrue a 40% reduction in the number of processes. An example of this is the use of electronic bank statements instead of using the manual bank statement for bank reconciliation and accounts receivable processes. This would save considerable effort that is involved in analyzing the data, moving the data onto different spreadsheet and inputting the data into the financial systems.

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Finances Can Make or Break a Marriage

Most first marriages start with high hopes and dreams that the uninitiated lovers share in boundless enthusiasm. Such optimism often includes an assumed trust and faith in one another. At the beginning of a new life together it can be easier to share assets and debts equally. As the marriage progresses and years are added to the relationship there are many factors that contribute to a decline in enthusiasm for sharing the money equally such as egos, selfishness, varied ideas about necessities versus wants, etc. Adversity sets in, as it does for all of us. Perhaps there are problems holding a job, or health issues arise, or maybe accidents occur or maybe it is as simple as mistakes which are made while balancing the checkbook. As troubles tax a couple’s finances resentment might build as one or both partners look back and wonder if they could have been more prosperous by staying single. If finances are kept separate the chances of working through such adversity together are lessened. Isolated into whats yours is yours and whats mine is mine people feel alone and disheartened even though they share life with another person through marriage. On the other hand, if finances are shared both partners are equally responsible for the successful financial outcome of the union. By jointly holding the money each spouse seeks the inputs and wisdom of the other to manage the accounts for maximum profit. What challenges one faces both face together. What success one achieves both enjoy together.

“When you get married you become one.” “Money is a key area that helps bring unity.” David Ramsey, Financial Expert. “… spouses should combine all finances and work together towards common agreed upon goals… Separate money equals greed. The bottom line is this: couples that plan their lives and finances together are much more successful financially and with their relationships.” –Marriage and Money – Dave Ramsey vs. Suze Orman, March 20, 2012

The old saying goes ‘There is no I in team’. Is marriage a contract between me and me, I and I, or is marriage about we, our, us? Going into life together can be tremendously beneficial to both partners. When two become one in all things each becomes more than they are by themselves. Math changes from 1+1=2 to 2 together = anything is possible. Many families have a tradition of saving their nickles and dimes to use to go on vacation. It strikes one as ridiculous to consider each family member saving to go on vacation separately. Mom saves to go see Grandma and Dad saves to go camping and Marsha saves for Disneyland while little Johnny saves to go to the ice cream parlor down the street. Agreeing upon a mutual activity takes negotiation and more effort than going on separate vacations, but it also builds shared memories that are held precious later.

This is not to say that one partner should demure in passiveness and yield to their spouse all financial opinions and decisions. Often there are stark differences in the perspective each companion uses to view resource usage and risk management with. One spouse may be analytical in nature and the other might make their decisions from more of an emotional base. Such dissimilar viewpoints can make it challenging to reach an equilibrium both are comfortable with. It may seem easier just to separate finances. However such a decision can result in grave consequences. “Divorce attorneys have told me that when money is the issue that brings a couple in to see them, as it often is, the specific issue is usually that the husband and wife were living separate financial lives. Want to mess up your marriage? Live separate financial lives.” How to Mess Up Your Marriage, Monday, December 12th, 2011, Matt Bell, author of Money and Marriage.

Is there more to a union of two souls than that of corporate mergers? Ironically, finances are often merged in shared business arrangements yet there are some who recommend the opposite approach for couples as if married companions are “… Independent Operators, my term for pairs who keep their accounts entirely separate.” Jessica Crouse.

Healthy marriages are built upon compromise, respect for each other, and the willingness to entertain the thought that together you are smarter than you are separately. Nature witnesses to the efficacy of sharing the resources- even birds and animals bring home the bacon to be shared with the whole pride. Think about the survival rate of any animal species that behaved as if each was responsible separately for their maintenance and subsistence. “Life is not 50:50, nor should it be… when did this degrade from a marriage to a micromanaged contractual partnership?… I see a continuum from the first bit of separate money in a marriage to basically living as roommates.” Evolving Personal Finance: The Slippery Slope of Separate Money.

Sometimes we might find ourselves wondering why some people make the financial decisions they do. During the recent housing crisis many opinions were expressed via twitter, internet forums, and even talk shows about where the responsibility rested for so many foreclosures. Terms like ‘predatory lenders’ and ‘irresponsible borrowers’ were bandied about. It is natural to become couch quarterbacks and passenger seat drivers when viewing problems others encounter, especially when we had no contribution to such problems. How easy it becomes to do the same with a spouse when married partners hold the finances separately. Harboring criticism instead of openly communicating about financial troubles does little to foster unity in marriage.

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Here’s Why You Need to Charge Your Electric Vehicle At Home

It is no wonder BMW is at the forefront in making both stylish and functional vehicles that never compromise safety. Charging your electric vehicle with a home charging station has more benefits compared to public charging stations. With BMW’s electric model ranges, you will experience an entirely new driving experience. No feeling is better than gliding silently through urban and rural traffics. All of this is free of fumes and harmful emissions that impact the planet. Going electric with BMW is one of the best things you can do for you.

While BMW iX3 Charging Station is available in many places and shopping malls in Australia, it is a good idea to invest in home BMW charger as it offers a plethora of benefits. In fact, charging your electric car with a home charging station has benefits compared with public charging stations.

Here’s why you need to install BMW home charging station:-

Save money

Instead of buying battery power from a third-party source every time you need to charge your BMW, it is a good idea to pay a flat fee for a residential BMW charging station and have unlimited energy from the same source that keeps your house warm and other electric appliances running. Of course, you would see a spike in electricity bill. But, you’ll save money by saving yourself from frequent trips to the public station and paying for recharging your car. Home charging stations pay for themselves in the long run.

Finding your home charger is affordable too. There are many electric vehicles charging station providers in Australia from whom you can buy and rely on them for support. There are three different types of home chargers, including level 1, level 2, and level 3. Based on the type of charger you buy, the cost will be anywhere between $300 and $2000.

Convenient

On average, it takes anywhere from four to six hours to fully charge your BMW with a level 2 charger. Let’s imagine that you need to drive 50miles to attend a meeting and your EV is running low on battery. If you have to wait the whole night, take your vehicle to the nearby charging station, recharge, and then drive. Wouldn’t that consume your productive hours? The same scenario is much more manageable if you have the home charger installed. All you need to do is, plug the car in and go to sleep. By the time you wake up, you’ll have a fully charged BMW ready for the drive.

Safe

Charging at home is much safer than public charging stations for a range of reasons, including the safety of you and your vehicle. You’ll have to wait for a long time in the public charging stations to charge your EV, and there’s no safety, especially if you are in the middle of high way.

As you see, they’re less expensive, more convenient and completely safe as long as it is installed properly.

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