Nolberto Delgadillo, CFO of Tulsa Public Schools, took on a budget shortfall in a way that few others have done: by bringing the district community into the budgeting process. We spoke to Nolberto about the experience during an interview in May 2020. Now, with the start of the 2020-21 school year behind us and looming budget cuts ahead, we're sharing his advice and reflections on how to approach this difficult process. We hope this interview can help district leaders as they face the challenges posed by COVID-19 and make tough decisions while listening to and learning from their communities.
What are some key takeaways from your team’s decision making process? How did you build shared understanding, delegate roles, and engage in idea generation?
We approached our overall process through a three-phase framework:
There is clear intentionality in doing it in that order. Although each phase could have its own framework or engagement protocol, it is super important that the team (and eventually relevant stakeholders) be engaged in this order to keep the narrative of the work cohesive so that when we arrive to the point of making decisions, we will have all arrived together.
Building understanding is not just an opportunity to share data, but also allows for questions and relieves the team of having to make uninformed or rushed decisions. As the team builds and solidifies their knowledge, we can have ideation discussions around choices, with no commitment to making decisions but with a commitment to refining our ideas. During this second phase of shaping our decision, we approach refinement with explicit boundaries/guidelines. These can be tied to guiding principles, a fiscal metric, holding an initiative harmless, and/or whatever is necessary to keep ideation structured towards achieving the objective. Finally, the final decision-making protocol is also important because not only do we want to be clear about how a decision will be made (e.g. fist to five, default to yes and defend no, unilateral Superintendent's discretion, etc.) but also leave little doubt as to why.
The expectation is that the engagement during phases one and two have provided a throughline towards the “why,” creating consensus and support on the final decision. I have also found it helpful to break up a decision into smaller (micro) decisions to alleviate complexities that may be surfacing as barriers.
How does your team foster strong cross-functional collaboration and decision-making? How have you increased transparency to allow for full group engagement?
Using the framework discussed above requires a huge emphasis on building understanding, which also means building trust. One of the best ways to build trust is to address specific misconceptions or areas that lack clarity within the budgeting process. You can be completely transparent, but without the explanation of what you are being transparent about, it’s difficult to get collaboration and buy-in. It’s also difficult in any situation to reach a decision if team members do not feel confident in the underlying data, leaving them with doubts on the fidelity of the problem or accuracy of the solution. In my role, I listened to learn where teams needed further assistance in understanding the budget and then worked to specifically clarify those areas (e.g. fund balance fluctuations, underspend usage, worker’s comp, etc.). While increasing understanding, there was also an intentional cultural shift on Team Finance to being more of a strategic investment partner and less of a compliance & spending enforcer: fewer conversations about expenses and more conversations about investments.
Our conversations began to shift from not only talking about the traditional finance items (e.g. how are we handling fund transfers, coding for the chart of accounts, etc.) which are important because many of them are driven by board policies and legal statutes, but also enhancing the conversations to help align the budget into a strategic investment plan. Our feedback was no longer limited to “Yes, that is an allowable Title I expense” but shifting towards, “Yes, that is an allowable Title I expense. Help me understand how that ties into your school’s (or district’s) strategy.” And as Team Finance continues to evolve, we are helping to engage in those conversations in situations where there isn't a clear strategy or an alignment towards the broader vision.
Ultimately, getting to a place of greater transparency is going beyond explaining the technical aspects of the budget; it is also ensuring that transparency serves to actively promote engagement regarding the strategic rationale for how funds (and resources) are being invested.
How does your team engage your community in understanding district finances and budget processes? What work went into developing these relationships?
This is one area where I am excited for Team Finance. During our recent budget redesign process, community engagement was a critical component to not only get feedback on initiatives the community cares about, but also to build community understanding on how the budgeting process works.
From a high-level perspective, our key strategies for community engagement were getting everyone on the same page about the numbers; identifying key stakeholders (e.g. Supt, Board President, Cabinet, PTAs, Union, etc.); and asking ourselves, do they understand not only the numbers, but also the narrative behind why the numbers are what they are? Do they know how we manage cash flow, underspend, and why have we used or not used fund reserves in the past? Once there is alignment on the math, we then attempt to shift the frame of the conversation from expenses to investments. Our goal is to determine, how has that been reconciled with students and community?
To help with that reconciliation, we created a Finance 101 deck, revamped how we displayed our key budget data on our website, created a new FAQ section to clarify misconceptions, released an online survey requesting feedback on reductions, and used a phased approach to in-person engagement.
The first phase of the in-person engagement was holding broad community meetings at each of our nine high schools to inform the public of the situation, answer questions, and share and collect data. We created a specific cafe protocol where those in attendance prioritized investment initiatives (and then were asked to make reductions).
The second phase of the in-person engagement were smaller meetings, run as workshops, with key stakeholders, such as PTA members, teachers, principals, and union members. We asked the groups to dive deeper into the data collected from the survey and initial meetings, then mock up budget scenarios. Lastly, we created a budget advisory group made up of key community members, including business leaders, faith leaders, educators, parent advocates, and others, to help reconcile and be a sounding board for the budget plan we were designing. Our plan was based on what we knew as academic and pedagogy best practices and what we learned during the first two phases of the in-person community engagement.
Engaging the community went beyond solely a conversation about balancing the budget; it was also about prioritizing investments, and that is a key difference to note. Of course, there will never be 100% agreement, but the more that ideas and information are exchanged, the less of a “blackhole” it is to explain the choice of one investment strategy over others. Even more important, one becomes either more confident in the plan or at a minimum, made aware of gaps and blindspots.
What are the most important things your office does to support principals throughout the district?
There are many things my team does to support principals, from solving procurement challenges to getting federal dollars claimed properly. But one area I am extremely excited for is how we are enhancing our strategic support for principals during the annual school planning process. To do this, we recently introduced the role of the School Strategy Partner (SSP). The SSP is a finance team member that serves as a strategic bridge between the instructional and fiscal branches of school leadership. The end goal is for the SSP to support, guide, and enhance conversations that align people, time, and money to identified objectives — and when objectives have not been identified, they help in the identification process.
The role of the SSP was intentionally tied to the revamping of our school planning process, which included moving closer to a network model, releasing enrollment projections earlier in the year, getting all of our funding sources in one budgeting tool, and working with our school leaders to further refine their strategic planning. This involved enhanced data inputs/reporting, plus countless other shifts to improve our planning; all that work involved several cross-functional teams (including phenomenal support from ERS!) and the SSP will continue to be key in the evolution of the process to ensure our principals continue to be extraordinary leaders for our students and community.
What is one piece of advice you have for CFOs who are managing a challenging financial situation?
To take care of yourself! That may sound cheesy and even unrealistic (and not the expected answer to the question!), but it’s so important to try. Over the past decade, I have learned that if I am not exercising, playing video games with my kids or taking whatever few moments to practice self-care, I will not be functioning at my best. At some points in my career, I have gone as far as blocking out time in my calendar specifically for a self-care activity (e.g. play soccer with kids, call brother, etc.). Just like we aim to manage our work calendars and respect our time, give your mind and body the same courtesy. Ultimately, I, like many folks, don’t back away from a challenge — but to take on a challenge, be it financial or not, you need to be at your best! So ask yourself, what energizes you and what replenishes your energy? Once you know the answer, be intentional about acting on it.
What are your top three dad jokes?