Rachel is the Coordinator of Holy Brook Associates and a fan of planning ahead and budgeting. Here she suggests 5 actions you can take now to get the most out of budgeting.
Many organisations will currently be setting or have just agreed their budget for the next year.
It’s a lot of work for everyone involved and it can be tempting to tick it off the to do list and move on. But given all the work you’ve put in shouldn’t you try to maximise the benefits?
Here are some tips that I often share with my client
- Start making your budget reflect your other plans – and vice versa!
On my training courses I tell my students that your budget is just a plan with numbers, and the best organisations recognise this and use their budget as a key part of their planning cycle.
2. Start talking about it
Your budget is no use if no one knows about it. A key benefit of a robust and relevant budget is that it can be used to co-ordinate people’s efforts and ensure you’re all pulling together. For example knowing that your small charity can only afford important refurbishment work following successful fundraising or grant applications can focus the mind and the efforts of the fundraising team on that project.
3. Create reports on your progress
Sharing the differences between your budgeted and actual figures widely within your management team, your board of directors or your trustees can help to ensure that you are able ot properly evaluate performance.
I recommend to most of my clients that as a minimum quarterly reporting of their budget vs their actual income and spend. However where cash is tight or there are substantial changes, for example a growing business monthly reporting is likely to be helpful
4. Hold yourselves accountable
Each part of the budget should belong to someone to deliver, and the delivery of the whole budget should be a collective target. Taking control of the budget and knowing your part in it ensures that you can all take responsiblity, and rather than debating whether there’s an overspend on paperclips be focused on getting results.
5. Celebrate your successes
The satisfaction of deliverying your targets can be really satisfying, whether that’s acheiving the sales your business needs to grow, increasing the number of people your charity helps or keeping your costs down so you can reinvest. Celebrate your successes and share good practice. It will help to motivate your team and build your collective determination to continue to create something special.