Smart cuts?: Strategic planning, performance management and budget cutting in U.S. cities during the great recession

Abstract

Periods of fiscal decline present an opportunity for city officials to transform their local government into a leaner and more effective organization by targeting cuts to non-essential programs and services. However, the political nature of the fiscal retrenchment process means that such opportunity is often squandered. Could the application of strategic planning and performance management in cutback management lead to a more focused and targeted budget cutting? Advocates of rational management believe that information gathering, analysis and use in decision-making can help local governments adapt to a fiscal crisis by facilitating targeted cuts in expenditures that preserve administrative capacity, and avoiding across-the-board cuts that trim both the organization's muscle and fat. The results of this research show that rational analytic techniques do matter in budget cutting.