Time is money. You never want to seem as though you’re wasting time because that would implicitly mean that you’re wasting money. Not your money either; someone else’s money. Your boss, your co-workers, your company, your customers. No one understands this dynamic more than project focused organizations that acquire revenue through the billing of time.Still, when comes time to complete the budget, it’s a bridge that has to be crossed. Getting your management behind a change in budgeting strategy can really come in handy when you’re trying to make the case for time saved. Time saved is money saved; when you’re using your time the right way, everyone wins.Here are a few tips to make sure you’re proposing this new budgeting system in just the right way.
Break Down Costs
One of the first questions for anyone in executive management when any kind of a change is proposed is: “What will my costs be; and what will we get out of this change?” That’s just fact that’s got to be dealt with right away or your project will simply be shut down. You need to be able to show an ROI (Return On Investment) by showing how costs will be reduced or revenues will be increased. Start with the cost of doing business today. Include time spent on the process and by whom (don’t forget anyone that might spend even an hour or two contributing to the process or maintaining the tools) and the tools they use today (i.e. Excel spreadsheets or a “home grown” application). It will surprise you to realize how much a it cost to produce a budget, forgetting the desire to re-forecast regularly.
Assess the Risk/Opportunity
If you are like many organizations today, you undoubtably have spreadsheets in use today at some level of the organization. How are these being handled? Is the data within them secure or vulnerable? Is the data accessible when an executive wants to understand the detail behind a particular line item? What could your highly skilled workforce be doing instead of spending hours/days/weeks tending to manual spreadsheet consolidations and tying out numbers over and over.
Time Saved / Enlightenment Gained
In the case of a new budgeting system, the bulk of the ROI is in the time savings. Introducing as much automation to the process of rolling up budget information from across the organization can save hours of chasing down contributors and manual consolidations. But don’t forget to account for the ability to re-allocate resources to more valuable tasks, such as analyzing product line profitability or determining additional areas in which to cut costs. Now you will have the insight to understand more aspects of your business and make decisions grounded in enlightening analysis v. gut feeling.
Time is money. However, budgeting for project focused businesses is an important aspect of monitoring the health of an organization. So when you’re considering a change in your budgeting system, consider the whole thing – what are the cost, what are my risks/opportunities, and what will I ultimate gain from making the change. Business Enlightenment.