Risk management and municipal elections

By Jack Kruf, Founding President PRIMO Europe

In 2009 it were the banks, in 2010 it are the countries, in 2011 it will be the municipalities. The global financial crisis eventually will fully hit our streets and neighbourhoods. Although, one week before the Dutch municipal elections there seems to be no real and focussed political thoughts about the where and how. As if the near future is a virtual one. To be frank and straight we should manage the incoming risks properly. Also new risks attached to on one hand cost cutting in plans, projects and activities which are dear to us and risks around necessary new approaches and innovation in public management. For that we will have to renew or even to re-invent ourselves.

What can we do for the new elected council? First we need to set the financial playing field very clearly and frequently bring up-to-date analysis with facts and figures of the ‘state of the city’ to the board table. Second, we need to line out the most efficient way of working by skipping bureaucracy, reconsider and renew products and services, check and evaluate our contracts with closely related partner-organisations and public private partnerships, and do cost cutting in the overhead.

Third, we need to formulate new targets with implementable scenarios for restructuring with the investments needed for that. In the fourth place we need to start new alliances for more cooperation with other municipalities, which of course lead to a more stable management and less costs. Rocket-science? No, but on one hand we need smart thinking (which is not as easy as it seems, because there are so many stakes to hold) and in the other hand cutting edge management technology, i.e. advanced risk determination and management on political programs. Which is also not easy, because of the different angles of perception of true risks.

In fact we should manage the incoming risks on both sides of the spectrum: translate innovation and new political targets in efficient and implementable processes and projects. On the other side carry out enormous cost-cuttings (20% of the budgets) without harming the system, knowledge and people and from the perspective to secure what is valuable. And all this within the frame of “rebuilding trust” for our citizens. Yes, we should find a new balance between political ambitions, needed cost cuttings and the capacities of our organisations on short and longer term. City managers and politicians are expected to show leadership and make firm decisions, communicate properly and stand for them. Risk management will help them do this job.

The decision should bring no harm to the balance within the city as a whole, as a community.  This is the true holistic approach. For this we need a vision on which public values should be maintained or served and which can be ranked lower, so to speak. This is of course within the very heart of politics. And will not be easy because of huge differences in political backgrounds. But it will eventually lead to sustainable and implementable decisions. For each council a challenge, a new challenge. They should be aware of the necessity to act as a collective. On the other hand, we do not have much time for visions and so we often act at once. This is a risk on its own. Let us not make the same mistake as we made before by ‘our behaviour to minimise problems and make promises that will be over soon, which is a major cause to our crisis’ (quote from Robert Shiller, leading economist).

Management of future public risks will demand an open attitude and the application of all our skills over the full spectrum and in a very short time range. This is like the Olympic Oval. Yes, and we will need each other on this. We all face the same challenges, don’t’ we?