Financial Strategies for every stage of the life cyle

1. Financial Strategies for every stage of the life cyle Critical Transitions • Doug Hering – Charter School Management Corp.

2. Life Cycles in Charter Schools

3. Planning and Gateway

4. Financial Strategies for Planning and Gateway • Determine cash sources and schedule of flows • Get accurate start up costs • Focus on necessities, not nice to haves • Don’t over promise • Get start up grant • Produce accurate (and safe) student enrollment estimates • Create a facilities plan • Activity – five necessities for start up • Five things you can do without at start up

5. OPENING

6. Financial Strategies for Opening • Begin to adjust for the surprises carefully • Are they permanent • One time • Use consultants or outsourcing for positions that may not need to be permanent • Develop consistent monthly reporting for leaders and the board • Educate board members in both • How to read financial reports • Their responsibility for the financial oversight of the school • How the finances of the school operate • Make sure you have a way of getting financial information into the CDE required account code structure • Activity – Financial Account Codes • Percentages of expenditures

7. The First Crisis: Leadership • From volunteers to employees • Outgrowing the founders • Professional managers • Generalists must specialize

8. GROWTH

9. Financial Strategies for Growth • Begin building a budget without volunteers (or as many volunteers) • Begin educating new board members in financial management • Make sure new school leaders understand the financial operations of the school • Begin looking at areas that need more specialized staff, programs, supplies • Revisit facilities plan, begin exploring what it might take to issue bonds • Create a financial picture of the school at maturity • Not just a P&L and Balance Sheet • Hire or outsource to qualified financial management people • Begin planning or saving reserves

10. The Second Crisis: Delegation • Decentralization • Autonomy vs. Accountability • Capacity over Quality

12. Financial Strategies for Stability • Begin reviewing past decisions about the budget • No sacred cows • New five year strategic plan • Make reserves a priority

14. Financial Strategies for Stagnation • Set aside a portion of the budget for change efforts, even if you don’t know what they are right now • Set aside money for organizational or cultural consulting and analysis • Develop budget for new curriculum/programs

15. The Third Crisis: Red Tape • Procedures over productivity • The “Headless Giant” • An “Entrepreneurial Exodus”

17. Financial Strategies for Decline • Priorities become • Reversing enrollment trends • Rebranding • Marketing • New leader • Restartup • Budget to “break things up” • Budget for development of new traditions or revamp of old traditions • Budget for • Facelift

18. The Final Crisis: Survival • Renewal or death? • Tradition or existence? • Control or freedom? • Declining Enrollment

20. Strategies for Renewal • Budget for turnaround consulting help • Create a five year turnaround financial plan • Eliminate fatty positions • Budget for new “leaders”

22. Managing Cycles through “Fit to Phase”

23. Resource Needs of Specific Phases

24. Leadership Needs of Specific Phases

25. Program Needs of Specific Phases

26. Systems Needs of Specific Phases

27. Life Cycles Resources

28. Critical Transitions Life Cycle Renewal for Charter Schools • Doug Hering • dhering@csmci.com • Presentation available at Slideshare.com • Visit charterinsights.blogspot.com for more on charter school lifecycles.