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Leadership in the government finance profession: a Texas perspective.


A version of this article originally appeared in the July 2010 issue of the Government Finance Officers Association of Texas Newsletter, available at

Many finance officers never contemplate what type of leader they are. Many of us think of ourselves as good supervisors and managers, but do not equate those roles with leadership. We do not always ask ourselves what leadership means to being well-rounded finance directors who bring value to the organization we serve. What constitutes effective leadership skills? Should finance officers, so concerned with maintaining the integrity of city's finances, give much thought to leadership? Also, what style of leadership do city managers expect of their finance directors? This article outlines the results of a research project that sought answers about what leadership means in the government finance profession.

It was not until I took a course in leadership, early in my pursuit of a doctorate in public affairs at the University of Texas at Dallas, that I began considering these questions and, as a result, decided to adopt the study of leadership in the finance profession as the topic of my doctoral dissertation. In addition to studying the literature of leadership and the published research pertaining to this field, I wanted to conduct my own survey of how finance directors in Texas perceive their leadership skills. I also wanted to gauge what Texas city managers felt about how well their management teams demonstrate leadership and how they evaluate the leadership skills displayed by their finance directors. My review of published studies indicated that this survey would be the first of its kind. Very few studies have been conducted on leadership in the finance profession, and none have focused on municipal finance officers. Also, most leadership surveys have concentrated on how subordinates perceive their superiors' leadership skills; this survey would be among the first to solicit the opinions of superiors.

After obtaining the endorsement of the Government Finance Officers Association of Texas (GFOAT) and the Texas City Management Association, I distributed e-mails to a sample of 201 Texas municipal finance directors and their city managers, inviting them to participate in an online survey. Responses were received from 134 finance directors and 94 city managers, response rates of 67 percent and 47 percent, respectively. The goal of the survey was to test a number of hypotheses related to leadership. Is effective leadership correlated with personal traits? Are finance directors' leadership skills affected by the field of study or the extent of leadership training they receive during their careers? Human behavior is influenced by so many variables that there is no single key to how a person will act under varying circumstances, but the survey results did reveal some interesting aspects of government finance officers in Texas and how they are perceived by Texas city managers.


Neither the Government Finance Officers Association nor the GFOAT maintains demographic data on their membership. Assuming that the survey respondents are representative of the profession in Texas, analysis of the survey results provides some idea as to the demographics of the profession. The majority of finance directors in Texas are women--54 percent. Anecdotally, 20 years ago, many more finance officers were men, probably close to two-thirds the association's membership. So our profession has become more diversified by gender within a generation. This diversification does not appear to extend to ethnicity, however. More than 80 percent of respondents indicated they are white, and 13 percent, Hispanic/Latino. Three percent of respondents are African American, and the remaining three percent comprise other backgrounds. This composition is not representative of the state's population, which is 35 percent white, 35 percent Hispanic/Latino, 12 percent African American, and 18 percent other. These results might indicate that the government finance profession should invest more effort in selling the benefits of the vocation to minority college students.


The average age of the respondents is 50, and the men are slightly older than the women (see Exhibit 1 for a breakout of ages). This average is not particularly surprising, since finance directors are at the zenith of their careers. However, knowing that 57 percent of respondents are older than 50 and probably within 10 to 15 years of retirement means that we need to train and mentor younger professionals to take the reigns of leadership within the next few years.


The finance directors who responded to the survey were from cities of various sizes. Men tend to be finance directors of larger cities, with the median population of 23,903, while female respondents were with cities with a mean population of 13,682. When simple regressions were run on salary with other factors, including gender, the strongest correlation was size of city. That fact may be of little comfort to women, however, since their average salary is 88 percent that of male finance directors. (See Exhibit 2 for breakouts of cities' populations and salaries by gender.)


Before reporting the results of the survey dealing with leadership, it makes sense to define the term. The study of leadership has been the focus of scholarly pursuit for some time, and a number of leadership theories have been postulated, reviewed, debated, and, on occasion, rejected or deemed irrelevant. However, most theories have coalesced around the idea that "leadership can be defined as the process by which an agent induces a subordinate to behave in a desired manner." (1)

The survey questions were structured in a way that addressed the leadership question indirectly. Simply asking finance directors and city managers whether leadership is important would elicit the obvious response--yes. To find out how leadership was perceived, as compared to other qualities, the survey first asked respondents to rate various characteristics of a generic finance director position. The survey then asked respondents to rate themselves personally and, in the case of city managers, the finance directors they supervise. Exhibit 3 summarizes the results.

The responses of both finance directors and city managers indicate that knowledge and experience are the most valuable characteristics for the position. Interestingly, finance directors and city managers both gave incumbent finance directors lower scores for leadership skills than they indicated for the generic position. One can infer from these results that finance directors and city managers believe there is room for improving the leadership skills of the person appointed to the director's position.

To obtain a fuller perspective of how city managers value leadership in their organizations, the survey asked managers to rate the extent to which four positions in their organization require attributes that are associated with good leaders. As in the earlier exercise, the city managers were first asked to rate the attributes for the ideal police chief, planning director, finance director, and public works director or city engineer. The results are shown in Exhibit 4.


On average, city managers rated each attribute as being fairly important for each of the four management positions they supervise. The two positions that are deemed to be more technical in nature, the finance and public works directors, were rated the highest for leadership attributes. However, as with the previous exercise with finance directors, incumbents in these positions are rated somewhat lower, as shown in Exhibit 5.

Police chief incumbents exceed expectations with the development of long-term plans, but in every other case, incumbents on average fall short of their city managers' expectations concerning leadership attributes. Considering the high expectations placed on finance directors and public works directors, it is not surprising that the variances between expectations and actual performance are greater for these two positions.

Once the results from the two surveys were compiled, simple and multiple regressions were run to determine the extent of correlations between leadership skills as perceived by the finance directors and their city managers, and different demographic and employment variables. None of the variables--including gender, age, type of education, extent of leadership training, rapidity of advancement, or compensation--yielded any significant correlation. The lack of correlation in this study supports the findings of other researchers. As mentioned earlier, identifying one key to leadership would have been an exceptional finding.


The research on Texas finance directors and city managers revealed that city managers do place a great deal of emphasis on leadership skills for their finance directors and other members of the management team. When asked whether they thought leadership was more important to them now than when they first entered the city management profession, 70 percent of the respondents said it is. The study also reflected that finance directors consider themselves to be fairly good leaders. This perception was confirmed by city managers, although their ratings indicated that finance directors fail to meet the high expectations placed on them by their executive officers. These perceptions will be further examined by the second phase of the study, which involves finance directors and their respective city managers completing a specialized leadership questionnaire. The results of that study will be the topic of a future article.

The information gathered in the survey suggests that the government finance profession needs to emphasize leadership training for members. The study revealed that most finance directors have had little training during the course of their careers and no formal training when attending college. Colleges should also be encouraged to include leadership training in their core curriculum. In summary, government finance professionals should at least begin thinking about the characteristics they demonstrate among their superiors, peers, and subordinates, and work on enhancing their leadership skills so that they can further contribute to their organizations and their communities.



(1.) Warren G. Bennis, "Leadership Theory and Administrative Behavior: The Problem of Authority," Administrative Science Quarterly 4: 259-301, 1959.

RANDY MORAVEC is chief financial officer for the Town of Addison, Texas.
Exhibit 3: Perceptions of Job Skills

Job Skilis--Finance
Directors' Perceptions General Personal Difference

Intelligence/Intellect 20.6 percent 20.4 percent -0.2 percent
Knowledge/Experience 25.0 percent 24.9 percent -0.1 percent
Responsible/Dependable 18.9 percent 21.1 percent 2.2 percent
Communication Skills 15.3 percent 14.9 percent -0.4 percent
 Skills 20.2 percent 18.7 percent -1.5 percent

Job Skills--City Managers'
Perceptions General Personal Difference

Intelligence/Intellect 22.6 percent 23.5 percent 0.9 percent
Knowledge/Experience 24.9 percent 26.5 percent 1.6 percent
Responsible/Dependable 20.7 percent 22.2 percent 1.5 percent
Communication Skills 14.6 percent 13.5 percent -1.1 percent
 Skills 17.2 percent 14.3 percent -2.9 percent

Exhibit 4: Ideal Leadership Attributes

Emphasis on Tasks--Ideal (Average Scores)

1-Not Important/ Police Planning Finance Public
5-Very Important Chief Director Director Works

Development of Long-Term 3.6 4.3 4.5 4.2
Communicating Goals and
 Enlisting Support 4.4 4.1 4.3 4.4
Adapting to Changing
 Environments 3.9 3.9 4.5 4.0
Developing Innovative
 Approaches 4.3 3.8 4.2 4.5
Motivating Employees 4.7 4.3 4.4 4.6
Demonstrates Admirable
 Behaviors 4.7 4.5 4.5 4.6
Total 25.6 24.9 26.4 26.3

N = 85

Exhibit 5: Perceived Leadership and Variance between Expectations
and Performance

Emphasis on Tasks--Perceived (Average Scores)

1-Fails to Meet Expectations Police Planning Finance Public
5-Greatly Exceeds Expectations Chief Director Director Works

Development of Long-Term Plans 3.7 3.7 3.8 3.7
Communicating Goals and
 Enlisting Support 3.8 3.5 3.7 3.7
Adapting to Changing
 Environments 3.7 3.5 3.9 3.7
Developing Innovative
 Approaches 3.8 3.5 3.6 3.5
Motivating Employees 3.9 3.4 3.6 3.6
Demonstrates Admirable
 Behaviors 4.1 3.6 3.9 3.8
Total 23.0 21.2 22.5 22.0

N = 85

Emphasis on Tasks--Variance (Average Scores)

 Police Planning Finance Public
 Chief Director Director Works

Development of Long-Term Plans 0.1 (0.6) (0.7) (0.5)
Communicating Goals and
 Enlisting Support (0.6) (0.6) (0.6) (0.7)
Adapting to Changing
 Environments (0.2) (0.4) (0.6) (0.3)
Developing; Innovative
 Approaches (0.5) (0.3) (0.6) (1.0)
Motivating Employees (0.8) (0.9) (0.8) (1.0)
Demonstrates Admirable
 Behaviors (0.6) (0.9) (0.6) (0.8)
Total (2.6) (3.7) (3.9) (4.3)

N = 85
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Author:Moravec, Randy
Publication:Government Finance Review
Date:Dec 1, 2010
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