Is your company’s budgeting process still stuck in 2010? Clinging to outdated budgeting rituals might be holding you back. Here’s how you can radically improve your planning and budgeting by adopting three key changes.
We see many firms struggle with their annual budget. During this moment of the year, we try to predict the unpredictable. In the end, the effort leaves us frustrated and directionless. This is why we advocate for a more continuous approach to budget planning. One that isn’t about perfect forecasts but about adaptability. It helps to:
1. Shift the purpose
2. Embrace strategic focus over financial precision
3. Plan faster, more often
Traditional budgeting often centers on hitting precise financial targets, but the real focus should be on achieving key milestones and improving outcomes for all stakeholders. Instead of obsessing over accuracy, we should define success by how well we serve our customers, employees, and communities. It’s time to allocate resources based on strategic priorities, not just numbers on a spreadsheet.
Ask the tough questions:
→ What could be the potential of our business in 2030?
→ Which milestones/outcomes drive our strategy?
→ Where should we invest to make the most impact?
When adjusting your approach, please consider funding to be directed toward customer-focused activities, not just (siloed) departments. This shifts the conversation from cost to value creation. In short: the world moves fast, and so should your planning. Revisiting and adjusting plans quarterly or even monthly can ensure you’re not tied down by a rigid, outdated forecast. It’s like staying within strategic “swim lanes”, allowing for movement but keeping you aligned with long-term objectives.