Dear colleagues,

I’m writing to you from the peaceful shores of Lake Balaton, Hungary, where I’m taking a break before diving into our own internal budgeting process. I know many of you are in the same boat, gearing up for the annual budgeting and planning season. Are we ready for it? How can we overcome the usual headaches and make this a less painful exercise?

In this digest, I’ve gathered some insights on alternative approaches like Zero-Based Budgeting, Beyond Budgeting, Shadow Budgeting, and Rolling Forecasting. These methods, especially when paired with the right technology, can offer the flexibility that traditional techniques sometimes lack—and maybe help you get through this season with a little less stress. It’s worth reflecting on what Jack Welch, the legendary former CEO of General Electric, once said: “It (budgeting) sucks the time, energy, fun, and big dreams out of an organization.” However, he also emphasiіed that budgeting is the backbone of any management system. Getting it right—and perhaps doing it a bit differently—can make winning much easier.

I hope this digest helps you recognise the benefits of these approaches and inspires you to implement them in your organisation.

Kind regards,

Larysa Melnychuk, CEO and Founder
FP&A Trends Group & International FP&A Board

By Stanislav Stoyanov, Head of Finance, EMEA at Oriflame Cosmetics

Reset, Review, Restart! These three core principles encapsulate the essence of Zero-Based Budgeting (ZBB), a strategy that has captured the attention of FP&A professionals for years. By justifying every expense from the ground up, ZBB ensures that resources are allocated efficiently and in line with current business priorities, making it vital for maintaining financial health and strategic alignment.

Read this article by Stanislav Stoyanov, Head of Finance, EMEA at Oriflame Cosmetics, to explore how ZBB can transform your financial practices, enhance flexibility, and support your organisation's goals in navigating economic uncertainties.

By Bjarte Bogsnes, Founder of Bogsnes Advisory

The traditional budgeting process continues to frustrate managers and finance professionals worldwide. Despite its widespread use and teaching in business schools, it’s seen as a time-consuming, outdated ritual that hinders organisational performance. The dissatisfaction goes beyond the annual grind, revealing deeper issues like poor strategic alignment, unethical behaviour, and flawed decision-making.

Read this article by Bjarte Bogsnes, a popular international business speaker and seasoned expert in Beyond Budgeting, to uncover the serious flaws of conventional budgeting and why it's time to move beyond it. Discover how the Beyond Budgeting approach offers a tested and refined alternative that can revolutionise your management processes, improve performance, and align your organisation more effectively with its goals.

By Ken Fick, Director of Finance & Administration at Maryland Department of Housing and Community Development (DHCD)

Imagine having a secret weapon in your financial toolkit that could expose hidden risks, validate assumptions, and fine-tune your forecasts with precision. That’s the power of a shadow budget — a parallel financial model that runs alongside the official budget, providing deeper insights and greater clarity. This tool enables FP&A professionals to sharpen their financial strategies, ensuring that every decision is backed by data-driven analysis and foresight.

Read this article by Ken Fick, Director of Finance & Administration at Maryland DHCD, to learn how a shadow budget can be effectively leveraged to enhance the accuracy of financial models and ensure that your organisation is prepared for any financial scenario.

By Nitu Agarwal, Vice President of Finance at Thomson Reuters

Rolling Forecast is revolutionising financial planning with its dynamic and flexible approach, offering a stark contrast to traditional methods. This forecasting method adapts to real-time business conditions, industry trends, and global events, making it crucial for maintaining a competitive edge. By focusing on current data rather than past trends, Rolling Forecast enables efficient resource allocation and swift responses to change.

In this video, Nitu Agarwal, Vice President of Finance at Thomson Reuters, demystifies Rolling Forecast and shares essential tips for successful implementation.

FP&A Trends digital events are vendor-agnostic and complimentary. If you are not able to join the live session, you can register to receive the recording later.

25 September 2024

Nowadays, traditional planning practices, where there is only one future, are no longer viable. FP&A Scenario Management becomes a game-changer that equips organizations with the ability to foresee and respond to multiple future scenarios and to achieve the short- and long-term goals.

Register for this webinar to unveil the potential of FP&A Scenario Management. A panel of senior finance practitioners and thought leaders will share their practical insights and real-world experiences on moving to the FP&A Scenario Management

9 October 2024

Harmonizing strategic, operational, and financial planning processes is crucial for best-in-class FP&A. This holistic approach, known as Extended Planning and Analysis (xP&A), transforms FP&A by integrating planning horizontally across departments and vertically throughout organisational levels. How can your FP&A department achieve this integration?

Register for this webinar to learn how the FP&A Trends Maturity Model can help with this. Developed over eight years by hundreds of senior practitioners and International FP&A Board members, this benchmarking and transformation tool offers a balanced approach to transforming your organisation and achieving xP&A.

Please refer to our Privacy Policy regarding the usage of your data by FP&A Trends. Contact us at privacy@fpa-trends.com if you have any questions or concerns.

All referenced trademarks are the property of their respective owners.