Annual budget cycle hurts
Do you remember last year’s budgeting process– how time consuming and detailed it was?
After the financial crisis, things may have changed. Your budget and plan are now more like wishes than reality. But you may still have the same plan.
Is the annual budget cycle the right way to plan and allocate resources in a business environment characterized by constant change? The discipline of making budgets was invented in an era of stable conditions. Nowadays companies experience major changes, and it is time to see if there are other ways to allocate resources. I have been looking into what the Beyond Budgeting movement are doing in this field and I am impressed. They refer to dynamic resource allocation. Learn more at www.bbrt.org
In the meantime I will save my back this year, and drop the annual budgeting process.