Many companies see budgeting as a time-consuming exercise of limited value. Some are resorting to a radical fix: getting rid of the budget.
Russ Banham, CFO Magazine
September 1, 2012
I agree that the budget process is flawed, at times even counterproductive especially in large organizations where meeting those target goals equals receiving a large incentives or going empty handed. However, the process of setting goals and tracking your progress towards those goals is crucial for any size business, from the small one man operation to the multinational corporation. Without goals a company would not be able to define their direction and chart a course to success, Therefore I think having a budgeting meeting is still important as a ?check in? process to evaluate where a business is in comparison to their original objective. I am just not sure that the incentives created around reaching goals especially for sales people are very effective. Joseph Serrone
Posted by JOSEPH SERRONE | June 17, 2013 07:00 pm
It is time for organizations to move beyond this time consuming low value add model. I look at IT in most cases you could do the budget or beyond a budget on the back of a napkin. Headcount, Hardware, software and Professional services. Depending on capitalization you can prioritize the project and execute. The best in class use Balance Scroecards and Activty based costing but for those yet to get to that level. The above might take a month consider exectuive engagement and strategy translation.
Posted by Earl Butler | September 18, 2012 07:44 pm© CFO Publishing Corporation 2009. All rights reserved.