Tag Archives: Budgeting and Planning
“Despite these uncertainties, CFOs and other C-suite executives, who strive to stay ahead of price changes and supply shocks in global energy and commodities markets, can find insights and analyses for their planning and budgeting needs. Four sets of indicators to watch below can help executives identify vulnerabilities and find alternatives, possibly giving organizations an added layer of flexibility against sudden market shifts.”
“But “Excel is not a good tool when you’re seeking to coordinate the operation of a multinational company,” said Bruce Lynn, managing partner of The Financial Executives Consulting Group (FECG). “I have my spreadsheet, you have your spreadsheet, everybody else has their spreadsheets, and none of them talk to each other.”
Still, many finance departments are reluctant to let go of Excel even when more powerful purpose-built applications are available.”
“But there’s a paradox, as Adrian outlined. Budgeting takes place within the context set by the strategic plan. The point at which the budget is set is the same point at which executive and shareholder expectations are put in place. Now circumstances change. And in a flexible planning environment so too does the strategic plan. What happens to the budget?”
“What is new in ZBB?
- ZBB is not a cost-cutting exercise. It is part of every line of the planning process.
- It is also a method to identify key drivers, so it is linked to driver-based planning.
- It is a rethinking of the traditional budgeting process.
- It is improving Business Partnering due to collaborations and the use of modern technology.”
“Rising prices for months have disrupted CFO budgeting, risk management, forecasting and pricing, and show no signs of easing.”
“The real power of ZBB is not in achieving cost-cutting benchmarks; it lies in combining digital budgeting tools with greater cost accountability and a process that links budgeting discipline to future growth.”
“It starts with finance being a business partner across the organization. For us, the finance organization isn’t on the sideline, waiting to be called in to the game; they’re on the field, part of running the plays that are called. And with that, there’s a clear partnership with our operations, commercial, and technical colleagues, which makes it a lot easier to inform the decision-making process.”
“Based on data from more than 3,900 organizations in our Open Standards Benchmarking survey for Planning and Management Accounting, APQC finds that top performers complete the annual budget in 25 days or less — half the time it takes organizations in the 75th percentile.”
“Driver-based budgeting links real resources and activities to your budget, and most FP&A organizations are striving to achieve that. From my perspective, it really acknowledges that the budget is the articulation of a series of operational items or activities. It’s different from traditional budgeting in that it shifts the focus to outcomes, and that’s ultimately how you drive your annual budget.”