There are three elements that every person working in a public management role must know. Firstly, how to create value. Secondly, how to build a sustainable and robust team. And thirdly, how to analyse the finances of the organisation. This last point is particularly important, with budget slashes rumoured to be as high as 40% hanging overhead and a strain on resources. Now is the time to make sure that the non-finance managers have all the tools they need to protect the bottom line.
Excellent financial management
Being able to manage finances effectively is a critical skill working in the public sector and the Civil Service. Doing so keeps you and your team out of trouble and able to perform the necessary tasks you need to do. Understanding financial management means understanding the following:
- The latest financial tools
- The latest financial techniques
- The knowledge needed to allow your staff to be financially efficient, confident, and informed
Fortunately, with improvements in technology, managing business finances is becoming infinitely easier. Nowadays, automation and accountancy software does most of the heavy lifting for you. You can quickly analyse your finances to contribute to the business success, even with little financial training. All you will need to understand is the financial terminology used and be familiar with the types of financial documents produced for analysis.
What financially informed managers can do differently
The combination of technology and a reasonable level of understanding puts you on the path to creating accurate and effective budgets. You will also be able to allocate resources effectively. Understanding the best ways to manage your finances gives you a strategic edge. If you can analyse and apply financial information practically, you can assess the impact of policy decisions. You can support external reporting and confidently aid in decision making.
If you are a manager with knowledge of financial management, you instantly improve your chances for a higher salary, more diverse career opportunities, greater job prospects, and career growth. Understanding the basics isn’t only beneficial to your organisation, it’s also helpful for your personal development.