Like many Americans, I have been watching the government shutdown and the debate about raising the debt ceiling with interest. The recent vote to increase the debt ceiling is a temporary measure that fills me with questions and concerns.
Can the government continue to raise the debt ceiling without serious repercussions?
In my business courses, we discuss several concepts that can be applied to government to bring about positive changes.
First, the government should engage in strategic planning.
Through strategic planning, governmental leaders can see the impending shutdown before it happens and act immediately to prevent problems. Smart business leaders engage in both internal and external analyses, identify strengths and weaknesses, and anticipate opportunities and threats. Businesses evaluate risks to determine the most appropriate course of action. Businesses continuously engage in planning and evaluation. They also have contingency plans to guide them in times of trouble. As I ponder these concepts and the tools used in strategic management, I ask the questions:
- Should the government take unnecessary risks?
- Should the governmental leaders have engaged in planning and foresight before this crisis began?
- What will happen if government bonds are downgraded?
Second, the government could benefit from a Balanced Scorecard perspective.
The balanced scorecard is a management tool that focuses on four key areas:
- internal business perspective
- learning and growth
The Balanced Scorecard tool allows managers to monitor progress on various metrics and to put into place an action plan if something is not on target. One area of the balanced scorecard can influence other areas. For example, in terms of the financial perspective we could consider cost reductions but these reductions would not be so low as to harm customer satisfaction, product or service quality or new product exploration.
Again, I am filled with questions such as:
- Should the government re-evaluate the services they provide, the satisfaction of the people they serve (the tax payer and the citizens), and the expenditures they are making?
- What will happen if the government continues to increase spending without regard for performance measures and accountability?
- What the government shutdown again in January or February? If so, what will this additional shutdown do to the livelihood of the American people and to businesses in general?
Government entities can learn many things from successful American businesses.
Tough decisions must be made in the future or perhaps the government may shutdown again, our debt may be downgraded, people may lose their jobs, businesses may go under, the credit system may fail, and our freedoms, pursuits, and existence may be put in jeopardy. Our future is impacted by governmental decisions just like the lives of customers, employees, suppliers, and stockholders are influenced by the decisions businesses make. As a country we could borrow learn from business and begin to revive our country’s position as a stable, innovative, land of opportunity and growth.