Budgeting touches every corner of the organization, and if you’re involved in it you know the “exposure” you get (some people think of it as over-exposure). And if you consider that budgeting hits people where it counts (the wallet) then you know you can wind up being the most loved or hated person in the organization.
So from a career standpoint, being told “Congratulations, you’re in charge of the Budget process!” is often met with mixed reactions. Do a good job, and it could make your career. But do a bad job…
The question is how can you mitigate the risks involved of running the budget process, while maximizing the opportunities for your career?
First, the risks. There are many of them but here are some obvious ones:
- D’oh! Spreadsheet errors happen all the time, and your personal credibility can be shot if a formula error isn’t found in time.
- Messed Up Roll Up/ Reporting. This is the classic problem of linked spreadsheets that feed reports. One broken link and the report can be off by a country mile.
- Communication errors. This happens when someone in Finance doing a budget on behalf of a department doesn’t hear something correctly, or misinterprets what someone says. Usually winds up badly…”That’s not MY number.”
- You become the bad cop. The senior executives decree that all budgets must be cut by 10% and turn to Finance to make it happen. And that usually happens a day or two before a Board meeting. With no time left to intelligently figure out where those cuts can be made – surgically – you wind up taking a hatchet to the budget. This does not win you friends.
Now some opportunities:
- You help managers actually think through and justify their budget requests, which win you friends.
- You help senior executives identify areas of strategic spending, which wins their respect.
- You work with individual managers to build a budget in their terms, in a way that they think actually about the business – rather than in accounting-speak. And you become a partner in the business.
- You build budgets grounded in strategic and business rationale, so when cuts need to be made, they can be made with a scalpel instead of a chain saw. This optimizes the resources of the organization.
- You find ways to reduce points of friction in the process, unburden people from the mechanics of getting a budget done, which makes the process more efficient.
- You find ways to reduce or eliminate all varieties of errors (formula, roll up and communication) which safeguards your credibility.