The strategic financial management of the police
New competences and new strategic financial management is changing the Danish police, which will manage more precisely and efficiently. Transparency regarding resources and costs are an important step along the way.
"We can, of course, only prioritize resources and become more efficient if we have knowledge in place. And if we are to make better decisions, we have to have much greater insight into what the effects are of a given activity. Therefore, we are building more precise and detailed financial management," - explains Rigspolitiet. The first step is system-supported budgeting and accounting follow-up, and here the police have already made great advances. The second step is activity-based financial management, which is well on the way, and the third step will be when the police will manage more using performance management. The police cooperate with SAS Institute on system support for strategic financial management.
We can, of course, only prioritize resources and become more efficient if we have knowledge in place. And if we are to make better decisions, we have to have much greater insight into what the effects are of a given activity. Therefore, we are building more precise and detailed financial management.
The effects must come first
The salary expenses for 16,000 employees, of which there are approximately 11,000 police officers, comprise up to 80 percent of the total budget of DKK 9.3 billion. Strategic financial management is, therefore, dependent on detailed time registration of the various tasks the police have. In fact, the police will distribute all costs on task types and activities. This is where the long-term opportunity for being able to manage the use of resources by the police better is, and thus create the greatest possible efficiency for the money.
"Until now, the police have managed by allocating resources, setting performance goals and planning activities. We want to gradually reverse this chain. Our goal is a future in which we, to a larger extent, first set targets for effects and then define the required activities and, finally, allocate resources". In the assessment, this strategic management of the police will be helped on its way by the tendency of politicians to refrain from managing the police down to the smallest details of their efforts.
Peter Nyborg, Department Manager
Change of culture
"We have started a major change of culture in the police. One of the most important changes is that in recent years we have been obtaining new competences in the police. Previously, lawyers and police officers dominated the organization, but in recent years we have hired economists, HR specialists and other academic groups both in the districts and in the central organization".
The strategic financial management must replace previous management processes and the police's managers must, over time, get used to the fact that they can obtain strategic and more detailed management information. This overview will become better and better as more people use the new systems, and this is major change of culture.
"We are building transparency in our use of resources. This means that comparable districts can suddenly benchmark themselves with each other, and we can use this to learn from each other and have a different dialog in the organization," says Peter Nyborg Rasmussen from the police's financial department. He is a graduate in political science and a good example of the new financial expertise in the organization. From the beginning, Peter Nyborg Rasmussen's task has included introducing tools to support strategic financial management and, after an analysis, the police chose to cooperate with SAS Institute on developing tools to support activity-based budgets, follow-up, etc.
"Back in 2011, budgeting and account analyses involved a lot of spreadsheets in all areas of the organization. It was time-consuming, uncertain and risky. At the same time, we lost some coherence in our data," says Peter Nyborg Rasmussen.
"It had a negative management effect to show up at a meeting with different truths, and this was something that took a lot of time.
Now budgeting and budget follow-up take place in a single, total SAS solution. The historical background was that in August 2012, the goal of having the next year's budget in the financial solution, SAS® Financial Management, was set. Many employees shook their heads at this apparently unrealistic goal, but after some intense months, the mission was accomplished." In hindsight, Peter Nyborg Rasmussen is satisfied with the professional efforts on the part of SAS Institute's consultants, who were crucial for the police's success with quickly abandoning spreadsheets and meeting the critical deadline without creating an IT fiasco.
Professionalization of the management culture
"Now we have all of the data in one place, and this provides a simpler process. Now it is time to ensure that managers at all levels use this machine room of data. One could say that we are moving toward having some of the same management opportunities that we know from private companies. But we also have to use them if they are going to be worth anything," says Peter Nyborg Rasmussen.
"It is clear that benchmarking between the districts and transparency about our efforts, activities and effects will professionalize our management culture," says Peter Nyborg Rasmussen.
The system landscape of the police will also move toward strategic financial management and support the change in this way. A data warehouse already collects data from Navision Stat, time registration, the case management system Polsas, other professional police systems and personnel on-duty scheduling. The police have also made major advances in connecting data about activities and finances using SAS® Activity-Based Management. Peter Nyborg Rasmussen, one of the architects involved in this development, is aware that the systems are not perfect from the start, but the data becomes more precise as the systems are used and the organization becomes better at understanding and learning from the new information. Strategic financial management is a journey, and the Danish police have already traveled far.
Budgeting and accounting analysis previously took place using many different spreadsheets, which was time-consuming and risky.
Now, financial management takes place in a single SAS solution with an underlying data warehouse, which combines data from many systems. The police have also made major advances in connecting data about activities and finances using SAS® Activity-Based Management.
Transparency, precision and one truth to tell. The police will use this for strategic financial management focusing on creating efficiency.