The promise of the new year lies ahead. One way to help ensure that it will be a profitable one is to re-evaluate your company’s pricing strategy. We recommend devising an approach that...Read more »
2016 Budget? …Don’t Forget to Feed it!
How do you make 2016 look just like or worse than 2015? You slap together a “budget” in an hour or two and declare it complete and don’t look at it again until Q2 ’16.
A budget is only useful if it is developed with three primary ingredients:
- Care and Feeding
Buy-in doesn’t mean that the management team or key leaders have veto power over the final set of goals. Buy-in does mean that key employees are given a chance to provide input and a point-of-view prior to a plan being published. Employees must feel like they are part of the process and have been heard if you want them to take ownership over the results.
“Stretchiness” is that delicate balance between a budget having easy-to-reach targets vs. out-of-reach targets. As a leader, you want to establish a budget that represents revenue and expense goals that are attainable, but won’t be easy to achieve. Folks should be excited when the budget results are met.
Care and Feeding is probably the most often neglected ingredient to having a useful budget. The budget must live and breath as part of the monthly conversation within the business. Key employees should know what incremental actions they need to take today, tomorrow, next week, etc., to advance the business towards it’s growth and profitability goals.
The budget is only useful if it is alive – build it soon and take care of it. It can be an awesome management tool when cared for properly!
Greg Owens – With over 25 years of finance experience, Greg brings a bold, practical mindset to financial leadership in companies of all sizes. His experience working in businesses from formation to multi-billion dollar enterprises provides him valuable perspective when engaging with owners and leaders of businesses. He is an expert in strategic planning, budgeting, financial modeling, reporting and many other areas of finance and accounting and engages with management at the ground level and build momentum to achieve growth targets. CONTACT GREG: d: 804.823.3915 | c: 804.517.0419 | e-mail: firstname.lastname@example.org