Improving organizational performance, not financial performance, is the goal of management in government. But better financial performance can lead to better organizational performance. Increased revenue can help hire more police officers to fight crimes, improve roads, or hire better teachers. How can financial performance help improve organizational performance in general? The Government Finance Officers Association recommends the following steps:

1. Determine how much money is available. The budget should be built on expected revenues. This would include base revenues, any new revenue sources, and the potential use of fund balance.

2. Prioritize organizational outcomes. The outcomes that matter most to citizens should be defined. Elected leaders should determine what programs are most important to their constituents.

3. Allocate resources among high-priori ty outcomes. The allocations should be made in a fair and objective manner.

4. Conduct analysis to determine what strategies, programs, and activities will best achieve desired outcomes.

5. Budget available dollars to the most significant program s and activities. The objective is to maximize the benefit of the available resources.

6. Set measures of annual progress, monitor, and close the feedback loop. These measures should spell out the expected outcomes and how they will be measured.

7. Check what actually happened. This involves using performance measures

to compare actual versus expected outcomes.

8. Communicate performance outcomes. Internal and external stakeholders should be informed of the outcomes in an understandable format.

Use examples to discuss the role of financial performance monitoring in the above steps of organizational performance improvement.