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Budget : Get clear on the year ahead

What would you like to achieve in 2024?

What do you expect to achieve?

What didn’t you achieve that you wanted to?

It is time to plan ahead for success so grab yourself a coffee and have a read of this article giving you some of our top tips for making the budget season a time of reflection of what happened in the past and a time of excitement of the endless possibilities for the future.

Top down…bottom up!

Everyone has a target they need to achieve but quite often the activities and plans are based on achieving the top line target. Herein lies a problem!. Potentially you will have a whole plan of action which is unrealistic! Or is at most wishful thinking.

We suggest doing a detailed bottom up plan from what everyone believes is achievable and then once you compare this to the top down plan you can see if there is a gap. Your action is then to fill any gaps with other stuff rather than just increase the plans that have already been put in place.

Don’t forget:- not everything you put in your budget will happen. Always have a separate set of actions or initiatives that can sit in your “stretch” budget which will act for a filler for anything that does not go to plan or in the best case scenario allows you to overachieve your targets.

We find a “stretch” budget gives huge confidence to stakeholders in most businesses demonstrating that you intend on fighting hard in the year ahead.

It’s all in the detail

It is so important to detail as much as possible so that every action, key product, new initiative, new target customer has a financial figure attached to it so that you can easily see why you are falling behind. It’s worth doing the detailed number crunching now and it will save you difficult conversations, head scratching or lengthy analysis during the year.

Have a clear direction of travel

It is easy to lose sight of the long-term goal, when your work flow is focused on the next 12 months. We find using a T-Map or something similar (see image) a great way to map out your milestones and key initiatives for the next few years on one page. You should review this with your team every quarter.

Tracking, tracking, tracking

We are strong advocates of a simple 90 day plan. Map out all your quarterly, monthly and even weekly actions and have the next 90 days in more detail. This document needs to be continually reviewed and brought out at every team meeting. This process will keep everyone focused, spot times when you have a lot to do, and will alert you to activities that are slipping. As one business executive said to us "I didn't think I could learn much after 40 years in business, but the correct use of this simple tool has made such a big difference. I will always use it now"

Sample T-MAP....

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