Best Practice Budgeting Tips

FP and a guy here today I'm going to share with you 10 budgeting and forecasting best practice tips. These were created by Ron Monteiro and they were used as part of our FP and a 101 course or budgeting section. So I'm going to jump right into this. Number one, complete a high level straw case. So it's always good to start with at least having a back of the envelope idea of what you think the plan is going to be for next year. If you're not doing rolling forecasts, which should give you that idea, then make sure you're doing it prior to the budget. Understand some of the scenarios and sensitivities before you go into that first meeting to kick off the budget cycle. Align with management. Do that up front. Don't wait till the end of the process and then management comes back and hey, those aren't the targets we had in mind. Why did you present this number? Align with corporate. If you're in a business unit with any assumptions, headcount, benefits, merit bonus, etc. Make sure you have all that figured out. Number three, develop both a high level, so kind of high level up here and a detailed calendar. Have one for each of the different business units, departments, cost centers and share it and make sure you hold them to those dates. Be beholden to the calendar. We'll talk more about that in a minute. Number four, book a kickoff meeting to align on those targets, assumptions and calendar with everybody. So you met with the executives, now have that meeting to filter that down for everybody will be part of that budgeting process. Don't assume people will know or that they'll just figure it out as they go. Always make sure you involve everybody up front. Number five here is follow the calendar religiously, right? Don't make exceptions. Don't let people be late. You really need to push them. Give them reminders throughout the entire process. Put it into your calendar. Put it into your reminders. Next one here is number six, have frequent check ins. I've had situations where I had daily check ins. Maybe people didn't show up every day, but every day during the crunch of the budget we had a meeting where anyone could attend. Ask questions like hey, I need to understand headcount or what are you expecting for revenue? And we could talk through each of those items. Number seven, highlight issues and gaps early. Don't wait till the end and tell management, hey, we're 10 million short of the target. Make sure you're communicating throughout the process. That will save you time in the end, it will make you look better. Business leaders don't want to be surprised. No surprises. Number eight and this is a big one. Utilize technology and align on this early. Anyone who's gone through Excel hell planning a huge business with versions, with links, with broken links knows the importance of having good technology. That's an area I can always help. Feel free to reach out. You can also find things on my website about the FPA landscape. There are lots of tools, more than there's ever been before, so there's no excuse not to have good tools. Number nine Start your presentations early. Last mile is critical. Don't do the whole budget and then the night before try to throw your presentation together. Because if you don't have a good presentation, you're not able to influence the business. And that's what it's about. Even with the budgeting process, you want to influence. Provide recommendations, your thoughts of how to improve. And then number 10, last one here, and I love this one. Couldn't give better advice if I said it myself. Stay calm. As the process involves, it never goes according to plan. So when you're building that detailed calendar, put a buffer in there and if you follow this process, you follow these 10 steps, I can promise you the budget will go better. May not be perfect, but this will definitely help. Let me know in the comments. What did we miss out? What would you add to these 10 steps? Thanks again from the FPNA guy. Have a great evening.