While knowledge loss during staff transitions is a challenge for any organization, it’s especially impactful for local government finance departments. The specialized nature of the work requires deep institutional knowledge that’s often held amongst a few long-tenured employees. Add to that the reality of leaner staffing resources, a single departure can create gaps that disrupt workflows and reduce efficiency. The good news? With thoughtful planning, these gaps can be minimized, and new hires can hit the ground running. Here are eight strategies to bridge knowledge gaps and set your team up for success.
#1. Preserve Institutional Knowledge
One of the greatest risks when an employee leaves is losing the “how” behind the work. If one person has always been responsible for preparing the budget book, for example, the process can feel like a black box to others. That’s why it’s critical to maintain detailed Standard Operating Procedures (SOPs) for core tasks that spell out each step so anyone can follow along.
Visual workflow maps can also help clarify roles, tools, and dependencies – giving a clear picture of who handles each part of the process and what is required. Organizing historical records (i.e., budgets, audits workpapers, and ACFRs) in a shared location ensures that context isn’t lost. Leadership plays a key role here since department heads should model documentation habits, prioritize knowledge capture in team goals, and allocate time for training. These practices protect institutional knowledge and reduce operational risk when new staff step in.
#2. Build an Onboarding Program
New hires anecdotally have their best chance at success when they’re given the right tools from the start. Replace static binders with digital, role-specific guides, walkthroughs, and video tutorials. These can range from a word document that can be easily updated as processes are updated or recorded screen captures of less intuitive or highly critical job functions.
When possible, pairing new hires with experienced staff for shadowing and gradual handoff of responsibilities is ideal. It accelerates learning and builds confidence through real-time exposure to processes like bank reconciliations or grant closeouts. However, in many departments, staffing shortages make this kind of mentoring difficult to sustain. In those cases, documented work product becomes critical.
Even if full mentorship isn’t feasible, department leaders should prioritize structured onboarding touchpoints. Assigning a point person—someone who can introduce the new hire to key team members, explain the systems and tools used across finance and other departments, and provide context for how the work fits into broader public service goals—can dramatically improve assimilation. This kind of cultural onboarding helps new staff understand not just what to do, but why it matters.
Beyond tasks, onboarding should include cultural orientation: What does public and customer service mean in your department? What values guide the local government? Heping new hires understand the why behind the work, such as internal controls, audit readiness, and public trust helps build great employees.
#3. Maximize Technology to Your Advantage
Technology can serve as a “second brain” for your department. Many local governments already have ERP systems or digital tools that go underutilized. Recording tutorials for recurring tasks and training staff on built-in features like reporting and approvals can reduce reliance on paper and manual work.
When budgets are tight, maximizing current tools is the easiest win. And when requesting additional investments, like automation or knowledge management systems, your case is stronger if you’ve demonstrated efficiency gains and error reduction.
#4. Cross-Training and Collaboration to Reduce Risk
It’s risky when only one person knows how to complete a critical task because that person can walk out with valuable institutional knowledge. Rotating responsibilities ensures no one becomes the single point of failure. Even short term rotations build familiarity and resilience. Recurring rotations for routine duties (e.g., purchase orders, vendor payments, cash receipting) every quarter, semi-annually, or annual for a week can give staff enough familiarity to step in during an emergency. These formal job duties are often a great way to build moral and belonging in a finance department too. Creating a sense of team and providing opportunities through exposure to areas that would not be in the normal list of duties.
Create space for informal knowledge-sharing: lunch and learns, roundtables, or quick demos. These habits reinforce that knowledge belongs to the department and not the individual and help surface improvement organically. Knowledge gaps are not just operational but they’re risk exposures.
#5. Assess Skills Regularly
You can’t address knowledge gaps you haven’t identified. A simple survey or checklist once or twice a year to assess comfort level with key tasks (e.g., preparing grant reimbursement requests, capital project reconciliations). These “pulse checks” only take a few minutes to complete but help managers target training, resource gaps, and support where it’s needed most.
Pair assessments with performance reviews or team meetings to uncover deeper needs. This proactive approach reduces risk exposure and ensures employees are equipped for evolving responsibilities. Leadership should treat these assessments as strategic tools to guide training and succession planning.
#6. Offer Ongoing Professional Development
Learning shouldn’t stop after onboarding. In government finance, rules, regulations, and reporting requirements change frequently, and staff need regular updates to stay compliant. Regular updates on GASB standards, Uniform Guidance, and audit preparation keep employees current and confident in their work.
Professional development can take many forms like lunchtime webinar or virtual trainings hosted by your independent auditor, state government finance organization, or GFOA. It could also be sending staff to conferences where they can dive deeper into technical sessions and network with peers and other thought leaders. Conferences are also a great environment to boost morale and connect with other agencies in the larger professional community.
Support certifications like the Certified Public Finance Officer (CPFO) or Certified Government Financial Manager (CGFM) which build expertise and exposure to technical topics relevant to local government finance. These are investments in time, and potentially funding if depending on your local agency, but can build technical depth, boost morale, and strengthen your department’s credibility. Ongoing development also support succession planning in the long-term and in the immediate prevent knowledge gaps.
#7. Plan for Smooth Transitions
Turnover is ultimately inevitable. When there’s notice, use a handoff checklist to capture SOP updates, document key deadlines, key contacts outside the finance department, and unwritten rules (i.e., workarounds, tips and tricks). Paired with any shadowing or recorded tutorials to give successor a strong foundation.
Depending on your organizational rules, you may be allowed to perform an exit interview to capture insights before an employee walks out the door. Rather than revisiting process details that should already be covered in the handoff, use this opportunity to ask reflective questions:
- What are your successor prioritize right away?
- What culture strengths should continue in this department?
- What’s one thing you want the next person to know?
These insights can uncover practical priorities and surface areas worth carrying forward—helping you preserve the work and the spirit of the team.
When transitions are sudden, lean on cross-trained staff or interim consultants to maintain operational continuity. Succession planning should be proactive. Even short-term vacancies can lead to a backlog that quickly escalates into larger compliance or operational risks. Temporary support and early preparation help prevent disruption and keep critical work on track.
#8. Build a Strong Network
Your department doesn’t have to solve every problem alone. Peer groups within state organizations, like California Society of Municipal Finance Officers (CSMFO), or a national group like Government Finance Officers Association (GFOA) offer templates, sample policies, and real-world advice from their members. For example, if you’re preparing for your first Single Audit, another agency might be willing to share their checklist and talk through what their auditors looked for.
Consultants can provide targeted support and additional resources to ensure matters are handled efficiently and effectively. Outside support can be scaled to your needs and bring perspective of experiences resources who already accomplished what you’re seeking. Sometimes that means stepping in during peak periods like budget season or year-end close to take pressure off staff. Other times, it’s more focused: training new hires, assisting with grant compliance, or streamlining a process that always seems to cause bottlenecks.
For departments looking for higher-level guidance, a consultant can even serve as a Fractional Finance Director. In this capacity, they can help navigate new GASB standards, advise on debt issuances, strengthen budget presentations, or provide strategies for long-term financial planning. Because many consultants have previously served as finance directors themselves, they bring the perspective of someone who has walked in your shoes—balancing compliance demands with limited resources while answering to council, auditors, and the community.
Whether it’s a short-term engagement or a leadership-level partnership, outside support can give your team breathing room, accelerate learning, and keep operations moving forward. Strong external relationships—both with peer networks and trusted advisors—can be just as important as the systems you maintain inside your department.
Food for Thought
Equipping new hires isn’t just about surviving turnover but building resilience. The real question is whether your team is ready for the challenge that hasn’t yet arrived?
Think about it this way:
- If your most experienced staff left tomorrow, could your department keep moving forward without disruption?
- Do new hires understand the why behind the work to make decisions in addition to the routine steps?
- Is your team prepared to pivot after a sudden departure, or would additional support help prevent disruption and backlog?
Closing the knowledge gap means creating a culture of learning, sharing, and preparing for what’s next.
How LSL Can Help
At LSL, we partner with government finance departments to preserve institutional knowledge, strengthen processes, and train staff for long-term success. Whether you need short-term support during a transition, training for new hires, or higher-level guidance from someone who has walked in your shoes, we’re here to help. Contact us today!
Plus, go to the guides page to download the guide to save as a resource for you and your team: GO TO GUIDES TO DOWNLOAD
