CIO Tips – budgeting
It’s coming around: budgeting time. For some people it comes as an annual surprise but it shouldn’t really. If you are not able to keep the pulse on your expenditure on a daily basis then the annual budget review can be a good time to sharpen pencils for next year.
- Delegation : Let your staff do the work, delegating responsibility to your team managers for preparing the budget gives them the opportunity to come up with new ways of shaving money off their costs, or even considering completely new ideas. Giving them a challenge to reduce the costs by 10% and demonstrate the savings leads to some interesting insights.
- ZBB : Consider zero based budgeting. The Wikipedia entry neatly describes ZBB but you don’t always need to do it for every part of the budget. It certainly make you or your department heads think a little harder if they have to start with a blank piece of paper and say why they need continue the maintenance on the piece of hardware that will be phased out before the year end.
- Finance is your friend: Your finance team are your friends, and if they aren’t they need to be. Understanding the pressures that they are the business are under in the next year is critical to the stability of your budget. Understanding what the drivers are for the following year is important, is a drop in sales forecast, are budgets likely to be cut the following year. Actually having the conversations with Finance around these areas can be very useful.