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This past year, CompassPoint set out to take on our budgeting season in a different way: using principles from participatory budgeting to inspire new practices for distributing power.
As a new finance leader with a community organizing background, being tasked to organize people to co-create a budget with a distributed leadership model aligned with my values, utilized my organizing skills, and helped me grow as a nonprofit finance director. It’s been both an exciting and suitable adventure for someone interested in the intersection of social justice values and financial systems. If you’re that kind of leader too, I want to share with you my takeaways from this year’s process in hopes that it can inspire you to reflect on your own organization’s approach.
Disclaimer: While we drew ideas and inspiration from Participatory Budgeting Principles, this wasn’t fully a participatory budgeting process. Instead, we looked at what was possible and needed in our current context and drew on some ideas from this framework that we thought would be useful for cultivating shared ownership of a budgeting process across our organization.
Wins: What Went Well with This Experiment?
Financial operations are often secretive enclaves in nonprofit and social justice organizations. Even when budget reports are shared with staff, they are usually cryptic and a surefire way to turn the listener off. Not only does finance work easily create a wedge between those in the financial know and the rest of the organization, but financial decisions are also historically made by people furthest from the work. This is not only true for budgeting but for the majority of financial systems. To combat this, as part of CompassPoint’s 2022 budget process, Co-Executive Director Shannon Ellis and I acted as Budget Coaches who could help increase staff voice and participation in the budgeting process and help everyone grow their financial literacy together.
As Budget Coaches, we identified Budget Managers across the practice–people leading circles or key projects who had a strong knowledge of priorities and who were also tasked with gathering staff input. Notably, these Budget Managers weren’t just “department heads,” but people who have been stewarding important bodies of work and who were positioned to gather other key perspectives.
We also created accessible learning avenues to expand everyone’s finance knowledge and vocabulary. We facilitated team discussions where team members weighed the financial implications of budget items and modifications. These were spaces to dream, but also to grapple with each other and find points of alignment and disagreement.
Working with teams in this way helped to increase participation, create more transparency in the process, and helped everyone walk away with new or deeper knowledge about budgeting and finance.
What Were Some Key Challenges?
Money is woven into our everyday lives. Money decisions shape the possibilities and limitations of our work in very real ways!
Opening up conversations about resource allocation will often surface challenging conversations that need to be had— and greater participation in a budgeting process means opening the doors to more of these conversations. There were moments in the process in which I couldn’t see a way forward and worried that we couldn’t make a decision about a team’s budget.
What helped to move the process forward and come to a resolution was partnering with a team lead to sort through which parts of a conversation might directly impact the budget, and which are bigger conversations about overall strategy and direction that need a different structure and process in order to be resolved.
For 2022, we flexed the budget timeline in order to give space for pertinent conversations. For the upcoming year, I will touch base with the teams to surface any conversations that need to happen and strategize about when to have them, before the process begins.
So What? Ideas and Lessons to Draw on for Your Own Budgeting Experiments
Lastly, here are some takeaways that I hope help you as you move forward with your budgeting processes.
1. Have some guiding strategies for learning together.
We used these strategies to guide our work:
- Getting involved OVER Getting it “right”
- Trying it on OVER Thinking it all the way through
- Developing shared knowledge OVER Getting it done quickly
- Trusting teams’ processes OVER Agreeing with the outcomes
Just think of these strategies as ground rules. Ground rules set the tone for a meeting or process and allow everyone involved to be on the same page about expectations. That is exactly the support these strategies offered our budgeting season. They may change as the years go on, but this was a good place to start.
2. It’s iterative for the organizers and participants!
As you will be doing something more participatory, it’s important to give yourself and the participants grace. Remember to build more time and space to mess up. Our budgeting process kicked off in September of last year and wrapped in January of this year. We were hoping to have everything done in December but, as mentioned earlier, we needed to flex our timeline to make space for necessary conversations. Keep track of what you are learning and solicit feedback along the way. This way you can apply it as you go and systematize it next year. Release the expectation that the first time trying on a process will be perfect and complete.
3. Make it fun and supportive!
To paraphrase a co-worker: “Wow, I can’t believe the finance meetings are the not-to-be-missed meetings in the practice.” Finance can be scary and boring, a terrible combination. I remember from my own time pursuing my MBA—if it hadn’t been for the instructors who broke things down in accessible and fun ways and made themselves available to answer questions, I don't know if I would have made it through the program.
Some things we did at CompassPoint to make things more engaging were choosing a theme, badminton to be exact, and using that as an analogy throughout the process. You can choose your own cheesy (or not) metaphor that speaks to your team! Using everyday analogies helps people contextualize larger financial concepts.
We also constantly reminded people they could reach out for help, created drop-in hour spaces, and are thinking of ways to offer support in more proactive ways this year.
Finally, there were constant reminders that it’s okay if people didn’t understand everything right away; they would understand it after applying concepts more than once. Ultimately, we created a can-do atmosphere. Don't think you can do it? Reach out to someone in your personal or professional networks that you think of as a “fun person.” Have a chat with them about ways to make the content approachable and interactive. It can be done.
4. Engage everyone as teachers and learners.
This is sort of a continuation of point number three. Treat your meetings like you are preparing for a popular education workshop, meaning there is an expectation of participation from everyone involved. Teachers and learners aren’t two distinct groups. Instead, learners make decisions and there are opportunities for them to bring their personal financial histories and experiences into the mix. Think about ways to make things engaging and more interactive than a lecture or report. Prepare so that you can bring financial information to life!
One of my favorite things to do is just ask people what is working about a meeting, what they would like to see improved, and any ideas they have for how they would like to see those improvements happen. You could take a sampling from your organization of people who are versed in nonprofit finances and those who are newer to it to shape agendas. Feedback is key!
Also, there are some rad groups out there working to distribute finance knowledge in a fun and interactive way. CompassPoint has our Finance Fundamentals: Understanding Key Language, Concepts, and Practices training (a great way for your team to start developing some shared foundational language). A Bookkeeping Cooperative also has a new Budgeting with Values training.
Continuing to Learn
CompassPoint's recent budgeting process drew inspiration from participatory budgeting processes, but more closely mirrored a definition of collaborative budgeting. “Although it’s the finance team’s responsibility to manage a budget, the budget itself belongs to every department within the organization. It’s a member of the communications team who determines how to spend the communications budget, and the tech coordinator to best manage IT investments. This means that budgets must be managed from the bottom up, rather than top down, and that buy-in is essential.” (Definition adapted from “What Is a Collaborative Budget and Why Is It Worth Working Towards”). Those who manage the budget get to play a key part in creating the budget, with the added responsibility of reaching out for key input! In future iterations of a more participatory budgeting process, we could lean more into shared revenue planning and build an even stronger collective picture of how we’re managing resources together.
How does all this help us distribute power? We intentionally challenged the assumption that a small executive and/or financial team holds all the answers and hands down a budget to the rest of the organization in this process.
If you’ve read this far: what’s something you’d like to hear more about when it comes to drawing inspiration from participatory budgeting practices? Drop a comment below or write email@example.com to help us develop future reflections on this topic.