No matter the size or sector of your organisation, you will have to deal with budgeting. Putting together a concrete plan on where and how money should be spent is the only way you can function in the modern economy.
The tricky part of budgeting is that there is no single way this has to be done! Every organisation is different and as a result their needs are in different areas. No two budgets ever look the same.
Having a strong budgeting process is an essential part of good governance. You need to ensure the capital your organisation acquires is going to the right places and not going to waste. After all, your stakeholders want to know their investments have a purpose!
With this in mind, we’ve put together a guide for better budgeting.
- Understand Your Organisation
The starting point for a good budget is a strong understanding of your organisation. This will help you decide what form your financial plans should take and which framework for budgeting will work better. For example, you have to choose between top-down and bottom-up budgeting, and the answer all depends on the nature of your organisation.
Top-down organisation is where the senior executives set the budget and departments work inside these expectations. Alternatively, a bottom-up budget is one which relies on the requests of the departments. Bottom-up budgeting is generally considered to be more accurate, as different areas of the business have the best knowledge of the work they do.
The type of structure you implement here will depend on the nature of the organisation. By understanding your organisational structure and the elements which inform it, you can take a more coherent approach to the budgeting process.
- Use Financial Data
Data is absolutely essential to moving forward with the budget. Your organisation functions on data – whether or not you use it! Making the most of the figures going in and out of the organisation will help you maximise your budgeting potential.
Consider the previous budgets you have implemented and the results – paying particular attention to KPIs. From this, you can learn even more about the needs of your organisation.
- Enhance Flexibility
Flexibility is essential in strategic planning, and budgeting is an essential part of this. Allowing space for some change will make it far easier to adapt to changes in the economy.
Since the Covid-19 pandemic, many companies have moved towards flexible planning, and this is always something to keep in mind. One approach to this is introducing hybrid working - which has an inevitable impact on the budget!
- Evaluate Performance
Making changes along the way is an essential part of budgeting. Hopefully, the flexibility you have introduced will allow you to do this. Now it’s time to make the most of it!
As you continue in your financial journey, make sure you evaluate the performance of your endeavours. This means if certain areas are not functioning as they should, you should have the freedom to make changes.
Performance evaluations include monitoring hard data, but also looking at qualitative measures of success. Talk to your staff and gain consistent feedback on how the budget is being implemented. This will help gain an all-round picture of what changes need to be made.
No matter the type of budget you implement, your team will be able to offer perspective on different issues. Communication starts at the planning stage and runs through to the final moments of application. Consult staff at every level of the organisation to ensure the budget meets everyone’s needs (and ideally surpasses them!)
- Streamline The Process
Make budgeting simple by introducing clear, consistent internal processes. When everything functions as it should, constructing an efficient budget will seem easy. You will naturally take the data and feedback you have gained and build it into the structure of your organisation.
Convene is an award-winning Board portal designed to improve efficiency and communication within your organisation. From creating an agenda to establishing a strong admin trail, every step of the process should be as smooth as possible.
Convene is now also available fully integrated with Microsoft Teams, so more than just your Board can benefit from Convene's features. The software simplifies remote, in-person and hybrid work for your whole organisation. With Convene in Teams, budgeting has never been easier!
Our comprehensive meeting management software is trusted by professionals around the world and includes features such as:
- A Document Library with role-based access to ensure your sensitive documents are protected.
- A built-in Audit Trail, so you can be sure you are compliant with all regulations.
- Integrated Video Conferencing, so you can make the switch from remote to hybrid working seamlessly, whilst still viewing your Board Pack all on one screen.
- Surveys, with the option for anonymity, so you can be sure you are aware of your employees' opinions.
- Accessibility Features, including text-to-voice, which makes us the leading accessible Board Portal.