Posted by Hannah Erdman Posted on
By: Scott Wallace, Managing Director
Is your budget ready to go and able to guide your company for the upcoming year, or is it already out of sync with reality? Many companies work through their budget process, only to find their budgets become obsolete within the first six months of the fiscal year.
Is your company in a similar situation? Many organizations struggle to address this disparity when their choices are either to reallocate valuable resources to update the budget or continue to operate without financial guardrails.
Let’s face it—Neither of those options are appealing, especially when the budget cycle can typically last 3-5 months, require multiple iterations and take a toll on team relationships, resulting in undesired behavior and political gaming.
So what is the solution? According to a 2016 study by The Association of Financial Professionals¹ top performing companies complete their annual budget in less than 30 days and their forecasts in less than 5 days. Achieving this level of performance is a journey that requires commitment of time and resources, and it begins by understanding your company’s capability versus leading practices.
Here are some steps for getting started:
- Identify the gaps—what gaps does your company have versus leading practices? Where are there roadblocks in your process?
- Prioritize the gaps you want to close—it can be tempting to want to fix everything at once, but what can you realistically tackle with your time and bandwidth? How can you proactively plan to address the gaps?
- Seek additional resources—optimizing your budget process will take time and resources. If your team is overloaded, find a partner to help you through the process and support your team along the way.
Not sure where to start? Let us help. Salo can help you identify gaps and partner with your team to develop a solution that is custom fit for your company. Click here to connect with Salo.
Scott Wallace is Managing Director in our Minneapolis office.
Click here to connect with Scott.