Group projects. A uniquely painful experiment that many of us try to avoid at all cost…
- Two-way communication between team members is often a challenge.
- Someone (or several “someones”) are perpetually behind and need to be coaxed along.
- There’s always formatting variations in the final document (no matter how clearly you established guidelines up front).
- And perhaps worst of all – usually half of all group members have an entirely different interpretation of the assignment’s original objectives or goals.
Admittedly, we’re being a bit obvious in the metaphor. But for many finance teams involved in a multi-participant budgeting process – it can feel like a highly dreaded and never-ending group project. The good news is there are ways to avoid (most of) the pains of multi-participant budgeting…
And even better, there are fantastic benefits – both qualitative and quantitative – for organizations that engage their staff in the budgeting process. Here are just 5 of the top benefits for your bottom line:
- Cost Containment: As the executor of the budget, the manager is likely better able to control the costs than anyone else in the company. 1
- Accurate Forecasting: Managers who are doing a job on a day-to-day basis have a better idea of what is achievable and what is prone to happen. 1
- Proactive Oversight: Managers are ideal candidates for continually monitoring progress against the budget and identifying necessary mid-course corrections. 2
- Increased Ownership: Bringing employees into the process and giving them accountability leads to greater ownership and engagement. 3
- Alignment with Strategic Objectives: Multi-participant budgeting fosters proactive communication and an improved understanding among staff of the organization’s strategic plan and their role in achieving that plan. 2
For more on the research behind these benefits, download the eBook: “When Budgeting is a Team Sport”
For more on avoiding the pains of multi-participant budgeting, check out the article in the AFP Magazine.
References:
1 http://managerial-accounting.blogspot.com/2012/11/participative-budgeting-and-its.html
2 http://www.principlesofaccounting.com/chapter21/chapter21.html
3 http://www.inc.com/resoources/leadership/articles/20070801/musselwhite.html
