Open-book management influences unexpected places

Nearly a quarter-century after its formal publication, SRC Holdings Corp. CEO Jack Stack’s “The Great Game of Business” is being adapted by local government, educational outreach and nonprofit organizations – and meeting with some success.

The model, outlined by Stack in his 1992 book, is patterned after open-book management and engaging employees in the budgeting process. Greene County Presiding Commissioner Bob Cirtin has taken to calling the county’s adaptation as “The Great Game of Government.” With a 2016 general revenue budget of $42.2 million, an increase of nearly $4.4 million, the county realized savings from casting a critical glance at line items and their effect on the county’s cash balance.

“The key to government is allowing employees that knowledge and that they have buy-in,” Cirtin said. “They’re interested in it and, ultimately, they’re affected by it.”

Adopting the Great Game isn’t the only factor. Cirtin said revenue generated by the county’s 1.25 percent sales tax rate increased 3.86 percent last year, and the budget still came up roughly $8 million short of fulfilling other much-needed requests,  including $2.5 million for federal and state mandated stormwater infrastructure updates and expansion of the Greene County jail. For the first time since 2008, county employees received raises and the 2016 budget accounts for a 2.5 percent cost-of-living increase.

For representatives at The Great Game of Business Inc., working with the municipality has presented unique challenges.

“It’s been interesting and frustrating working with them because they are such a different animal,” said Rhonda Alexander, the Great Game’s event, coaching and training manager. “For one thing, they can’t say the ‘p’ word – profit – they have to say ‘net income.’ At the end of the day, they can’t go out and sell more product to raise money – they’re relying on the taxpayers.”

In the past two years, Alexander said the company gave Greene County, Big Brothers Big Sisters of the Ozarks and Missouri Southern State University in Joplin pro bono training and assistance as case studies to see how the model might be applied outside of traditional businesses.

The effort, Cirtin said, has given county staff members a better understanding of their influence on expenditures, which ultimately should reap long-term benefits in the form of saving money.

Play by the rules
County Program Director David Burton said nine months into its run at the Great Game, the Greene County University of Missouri Extension office is seeing results.

Serving 17 counties in southwest Missouri, the office finished 2015 in the black by roughly $9,000 – ending five years of losses. Burton credits certain aspects of the practice, such as holding weekly team meetings and adopting a financial scorecard, with pushing employees to make an impact on the Extension’s financial health.

“There’s more business-type thinking: what can we do to generate additional income, what do we charge for a particular program or helping people understand what those revenues are,” Burton said. “People weren’t really in that mode before. It was always assumed but never really happened.”

In 2015, the effects were tangible. Tests on soil samples, which reached an eight-year high of 345 after the collective push, generated $3,100 for the office. As the Extension’s biggest moneymaker, Burton said it’s an important number to watch.

The 2016 budget is up nearly 33 percent to $84,930.

“We’re speaking the same language with the county commission,” Burton said of the $36,000 county contribution to the budget, up from what was traditionally the state-mandated minimum of $10,000 the past several years. “As they see us paying more attention to that, they probably feel the money is being more wisely used.”

Last year, Big Brothers Big Sisters of the Ozarks Inc. also set internal records during its first full implementation of Great Game financial huddles and scorecards. CEO Katie Davis said the nonprofit’s revenue grew 22 percent to nearly $1.2 million, and the number of matches between children and adult mentors was up 17 percent to 257 on the year.

“The more you know about something, the more you can affect it,” Davis said, noting a heightened awareness among staff members of the organization’s inner workings.

The 2015 focus was to improve recruitment through increasing responses to volunteer inquiries before beginning the interview process. During a 90-day minigame designed to move a critical number in the fall, Davis said staff made 284 follow-ups – a 173 percent increase compared to the same time a year ago – by changing their tactics. Instead of asking friends and family for referrals, staff gave presentations at businesses with employees who had volunteered.

“It took a lot of trial and error to figure out that was the right thing, but since 14 employees were trying different strategies we were quicker to react,” Davis said. “We have a marketing person in charge of recruitment, and if we left that to one person we never would have made as much progress.”

The next moves
At the Extension office, Burton looks ahead to 2017 in anticipation of filling a 4-H specialist position cut from Greene County in 2012.

With a conservative growth plan of 10 percent this year, the litmus test will be producing enough revenue to add back the position.

“What we’ve tried to avoid in both budgeting and fundraising is a situation where we’re fundraising to keep the door open,” Burton said. “We didn’t set a budget that projected a profit – we’re planning to spend everything we bring in.”

Meanwhile, the county is receiving interest from other municipal groups. Most recently, officials from the city of Fulton and the Callaway County Chamber of Commerce & Visitor’s Center have reached out to learn more about the Great Game, according to Greene County Auditor Cindy Stein.

Big Brothers Big Sisters of the Ozarks’ Davis said other chapters in similar sized markets – those serving more than 500 kids with $500,000-$2 million in annual revenues, which represents a fourth of Big Brothers Big Sisters’ national roster – could benefit from her group’s example. She plans to give a presentation at the Mid-Large Agency Alliance’s annual meeting this year.

With “Dream Big” as its mantra in 2016, the group’s goal on the home front is to beat the record numbers set in 2015. Davis said the nonprofit seeks 474 matches by the end of the year, with an eye toward forming an advisory council of board members, donors and program partners to create a five- to 10-year plan.

“The Great Game calls that high-level planning,” Davis said. “That’s the only step we’re missing right now.”