6 Ways Great Leaders Evaluate Budget Spending!
After more than four decades of personal involvement, in almost everything related to leadership, from identification and qualification, to training, development and consulting of thousands of real and / or potential leaders, I have reached a strong point I think leaders need to take budgets and the budget process more seriously! Very few of these individuals either do not know, or do not care enough, why this is important and how to proceed, effectively, using a budget, in a more meaningful way, and actually knowing how, to , truly, evaluate the budgetary expenses of a group. With that in mind, this article will try, briefly, to consider, examine, review and discuss, 6 ways, the great leaders, proceed, in your search, to effectively evaluate, in depth, the budgetary expenses, etc.
1. Look back at the proposed budget, versus actual expenses, for a minimum of 3 years: Too often, those who created this document look back at past budgets, rather than what actual expenses may have been. Knowing what was spent and how helps in the process, but, unless / until, the emphasis turns, yes, it was spent, in the most productive way, in the best way, and, yes, there may be better options, in the future, the best interests of a group, are not being served / satisfied!
2. Differentiate between fixed / contracted expenses and other expenses: When trying to create a valuable document, you must separate / differentiate between costs, which can be fixed / contracted, and others! Some of the former include: rentals / leases; contracted wages; certain public services; etc. While some of these may have some leeway, most of the focus / emphasis should be placed on the other types.
3. Consider options / alternatives: Avoid the, My way or the highway attitude! Always look at all expenses and ask if there are other viable options and alternatives that can serve the group better and more effectively!
Four. Think out of the box: It is important to proceed with an open mind and think outside the box. Is there a way that your organization can improve, perform, effectively, prioritize, differently, etc.?
5. Relevant and sustainable ramifications: Every action, or failure, to take action, when necessary, and indicated / necessary, has some potential, relevant and sustainable ramifications! Looking at the proposed expenses does not simply mean reducing costs, but rather achieving the best, the most productive, the best investment!
6. Review, by line item, based on: Do you know how to eat the elephant? One bite at a time! When it comes to budgeting, this means that each item, not fixed, needs to be considered and thoroughly reviewed, rather than what we often witness, which is a generalized approach.
Even when the expenses, the need, the reduction, how and, in – what, these cuts, are often made, difference, between, groups, who, survive, in the future, and prosper, and the rest – of – The package! Are you ready, willing and able to be a better, more prepared and focused leader, especially when it comes to creating a more meaningful and relevant budget?