While most municipalities post their organizational chart, or at least job titles on their contact us page, you’d be forgiven for not knowing every position in the organization by their initials. But the post of CAO, or Chief Administrative Officer, is one that you should know. And it helps to know a bit about how the position came about.
Historical Development
We didn’t always have CAOs in municipalities. Some still don’t. Historically, the mayor and/or council provided administrative oversight over municipal staff. In municipalities that only have a handful of staff, that’s still sometimes the case. A small number of people with limited responsibilities do not require a lot of oversight, so it made sense to allow the same people responsible for giving them strategic direction to also provide them with some general oversight.
But over time, the Clerk often became a de facto head of staff: they have a central and coordinating role in the administrative staff, the most interaction and expertise with legislation and bylaws, and the most contact with council. While it’s possible that a clerk could perform all of those functions and still keep their head down, their placement in the organization is perfect for at least informal leadership. Many municipalities today have a Clerk/CAO position for this reason.
Similarly, the Treasurer (sometimes called a Director of Finance) keeps a bird’s eye view on municipal finances, preparing and maintaining the budgets. This gives them contact with every department, and the budget is prepared at the strategic direction of council. Council may communicate their vision and ideals for the community, but it’s the budget that determines what gets done. As such, there is inherent leadership in the Treasurer position, and it’s not uncommon to see a Treasurer/CAO position today.
Also, historically it was common for small municipalities to have a Clerk/Treasurer position; such a person virtually had to be the lead staff position. But in such a configuration council usually had a strong role, that may have included some administrative functions, in order to preserve the democratic nature of the local government.
The Rise of the Manager
A century ago, Canadian municipalities started embracing an American invention: the City Manager, sometimes called the Council Manager (and today, the CAO). The introduction of this position sharply separated the strategic leadership function of council from the administrative function of staff. The Manager became a go-between, keeping council up to date on the activities of staff and directing staff according to the vision of council.
There’s a lot of value to that separation. Politicians come and go, and having stable leadership in the form of a long-term manager is important for staff. And politicians embody the feelings of residents, which means that politicians who direct staff can be volatile and critical; a manager can shield staff from the volatility of politics while still providing direction on matters of resident concern. And ultimately, having a full-time staff person to coordinate administrative activities is helpful, allowing the clerks and treasurers to focus on their primary function rather than the growing demands of leadership.
While several Ontario cities had enacted private legislation to appoint a manager position (starting with Guelph in 1919), the Municipal Act did not give all municipalities the authority to do so until 1970.
Particularly in larger municipalities, the Commissioner model provided a variation on this by appointing several commissioners, senior staff each representing several departments, to report to the CAO or Council Manager. For example, a Commissioner of Hard Services would report on matters related to Public Works, Transportation, Engineering, Water/Wastewater, and Fleet and Facilities. It’s worth noting that all of those functions are included in our Public Works department, making our Director of Public Works quite similar to a Commissioner of Hard Services. But if our municipality was so large that each of those functions was the size of an entire department, with numerous staff working on a large scale and scope of projects, not even Mr Whiteman could keep up with it all. So these kinds of systems are largely a function of scale.
The Business Approach
In the 1980’s, the Western world took a sharp cultural turn toward business as the ideal model of organization. The “Reagan-Thatcher era” was a time of reorienting the public sector toward the approaches of the private sector. Thatcher famously said “there is no society,” and described government as a service provider to citizens, who were equated to consumers. Businesses were lauded as being lean, agile organizations, while governments were denigrated as being bloated bureaucracies. If governments could be run more like businesses, it was suggested, the taxpayer could pay less taxes and still get higher quality services. This mindset was the driving force behind the New Public Management system.
I can’t emphasize enough just how much I dislike this approach. The stereotypes that it’s based on are clearly untrue: there is nothing inherent to a business that makes it efficient, and nothing inherent to a government that makes it inefficient. Efficiency and inefficiency are outcomes of system dynamics, which make no distinction between the public and private sectors. Whatever model an organization follows, it should be based on their actual function, purpose, resources, and needs. Trying to impose a business lens onto a government is a recipe for disaster; they’re inherently different organizations.
The NPM approach reorganized municipal departments into “business units”, awarded funding competitively based on “key performance indicators” or KPIs, and sometimes even prioritized departments that were profitable over those that were not.
This era saw a major rise in user fees for municipal services, and the Masters in Business Administration (MBA) degree being seen as a key credential for the CAO. Even the term CAO is imported from business. Thankfully, these things are all that remain of the NPM experiment; the “business unit” organization of municipalities is very uncommon now.
The CAO Today
While every municipality has its own structure, most today have a CAO who provides organizational leadership to staff and serves to operationalize the strategic direction of council. They are a conduit for staff reports to council, reporting to council on all matters on staff’s behalf (or at least signing off on staff reports); and serve as the only employee of council, with all other staff being employees of the corporation of the municipality. As such, they’re the only member of municipal staff that council has any role in hiring or firing.
Many elements of leadership and management have changed over the years. The days of the “City Manager” were dominated by a top-down approach to management that today is seen as archaic and, frankly, infantilizing to staff. Today, leadership is seen as empowering staff to take full responsibility for their work, rather than serving as extensions of their managers. There’s even a movement toward flat organizational structures (no hierarchy), and self-management. As with NPM, we need to be cautious about importing ideologies from the private sector, but some of these changes in mindset are finding their way into the way municipalities operate. The ability to work from home is revolutionizing offices everywhere, and how things like that impact municipalities is largely a function of the policies and norms of the CAO.
Brighton is currently hiring a CAO, and should be able to announce a hire by the end of 2023. It has been a very interesting process, and I’m confident that we’ll end up with someone whose skills, experience, and attitude are a benefit to our staff and residents.