Articles

Is There a Better Way to Zero-Based Budgeting?

Zero-based budgeting is a process of budgeting that requires managers to build their budgets from zero on an annual basis. It employs a complex methodology wherein finance breaks costs into decision packages, assigns each package to two owners with differing perspectives, and requires decision-makers to force-rank priorities. ZBB’s focus on exposing and eliminating unproductive costs and understanding cost drivers has earned it a renaissance of late, particularly among executives seeking more sophisticated value-creation tools. So, what is the best approach to this concept?

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