Author Box
Articles Categories
All Categories
Articles Resources

Budget Using The ABCDEF Method

April 20, 2012 | Comments: 0 | Views: 230

In well over thirty years of working closely with hundreds of not- for- profit organizations, and hundreds of more for profit businesses, I have observed that one of the major weaknesses is in the area of effective and meaningful budgeting. Far too many organizations look to the budget process as a tedious exercise, if not a nearly total waste of time and effort. They have observed how their organizations have treated previous budgets, and question whether the effort is worth it. However, those organizations that use budgets and the budget process in the appropriate manner, develop a stronger, more responsive organization, that is more efficient, more relevant, understands its direction including its strengths and weaknesses, and therefore more capably prioritizes its efforts and expenditures. One of the best formulas for this budget process is what I call the "ABCDEF" Method.

1. The "A" is for acknowledging the need to go through the budget process in a meaningful manner. That means committing to examine all aspects of both revenues and expenditures, and budgeting based on needs and prioritizes, instead of merely continuing the status quo. Part of this commitment must be using zero- based budgeting, which includes examining each line item on its own merits and then determining what it is worth to the direction the organization needs to go in, and the group's needs.

2. "B" is for making the budget one that is benefit based. Budgets must be designed to provide the most value to the organization, its vision and mission, and its constituents, members and supporters.

3. "C" represents creativity. Budget molders must look for alternatives, and sometimes creative outside- the- box alternatives must and should be considered.

4. "D" stands for driving down waste. Only by properly developing a budget and utilizing it effectively is it possible to examine each and every expense area, and to objectively look for waste and/ or inefficiencies that need to be addresses and corrected. There must be no sacred cows, but eyes must be focused at the goals, vision, mission and needs of the organization.

5. "E" should be obvious, but is often overlooked. This process, to be done correctly and in a meaningful manner, requires effort, experience and expertise. Just because someone states that they want a meaningful budget does not necessarily mean they will do, or are capable of doing, what is needed.

6. "F" represents fiscal/ financial reality. Budget creators cannot get bogged down in the past, and refuse to make changes because that's the way it's been done in the past. What are the financial needs of the organization, and what are the financial obstacles being faced? Are they short- term or long- term? Is this only a temporary hiccup or a trend?

I urge all organizations to take a serious look at how they approach their budget process. Do they follow a protocol? Do they heed the approved budget during the course of a year? How serious are they?

With over 30 years consultative sales, marketing, training, managerial, and operations experience, Richard Brody has trained sales and marketing people in numerous industries, given hundreds of seminars, appeared as company spokesperson on over 200 radio and television programs. He's negotiated, arranged and organized hundreds of events.

Richard's owned businesses, been a COO, CEO, and Director of Development, as well as a consultant. His company Website is, and he can be followed on Twitter @rgbrody. For great information on many topics, visit PLAN2LEAD's Facebook page and LIKE ( )

Source: EzineArticles
Was this Helpful ?

Rate this Article

Article Tags:

Budget Process


Abcdef Method


Previous Budgets


Zero Based Budget


Fiscal Responsibility



In India, employment opportunities are set to grow by a good margin in the coming year, a phase which was started in the turn of the second decade of the 21st century. organisation, candidates with

By: Sarkariexam l Business > Careers Employment l April 01, 2013 lViews: 11709

Sometimes it is amazing to see that certain jobs can precipitate huge turnouts in the recruitment drives. It is as if thousands of people were waiting for the vacancy advertisements and the moment

By: Sarkariexam l Business > Careers Employment l December 30, 2012 lViews: 690

In recent times, jobs in healthcare segments have grown tremendously. It is anticipated that this growth curve will continue for the times to come. Various factors are responsible for this

By: Sarkariexam l Business > Career Advice l December 27, 2012 lViews: 448

Are you in a dilemma whether to choose web based CRM or not? If yes, don’t worry. You aren’t the sole person having this doubt.There are numerous firms trying to make out whether investing in a

By: Reneta Vasileva l Business > Customer Service l December 23, 2012 lViews: 409

If you think about it you will realize the fact that each business has its own set of risks that are involved in it.The trade secrets that you have and the information related to the business is what

By: brumbrum1 l Business > Risk Management l December 23, 2012 lViews: 263

As the time is changing, concierge management services are now growing despite the slowing economies of the world. The main reason of it is the need that is highly specific to the people who like to

By: willsmith10 l Business > Management l December 23, 2012 lViews: 334

Many small communities and cities have much to offer to residents and visitors alike, yet they often find it difficult to appropriately and efficiently advertise the city's unique qualities. When a

By: Blake H Alexanderl Business > Non Profitl April 17, 2012 lViews: 177

Change within any organization, whether it's a result of internal or external factors, is inevitable. The ability to seamlessly adapt to change is an important key in maintaining sustainability,

By: Matthew Bowesl Business > Non Profitl April 17, 2012 lViews: 221

Faced with stretched budgets many nonprofits have turned to partnerships in order to provide services or programming for their constituents. When done correctly, partnerships are a very effective way

By: Michael V Sclafanil Business > Non Profitl April 15, 2012 lViews: 194

You know you need a fundraising plan, but if you're like most, you don't know where to start.  Although planning can seem overwhelming, it's not really a difficult process, yet it makes all the

By: Sandy Reesl Business > Non Profitl April 12, 2012 lViews: 180

Like the rest of our society, finger-pointing and blame are often a part of the culture at social service agencies. This needs to change to an emphasis on truth-telling as a way of getting to the

By: Larry Wengerl Business > Non Profitl April 11, 2012 lViews: 184

Located in the mountainous region of Jammu and Kashmir, Ladakh with its divine monasteries and rich cultural traditions is an exceptional place for volunteering. The volunteering opportunities

By: Karmmy Palll Business > Non Profitl April 07, 2012 lViews: 230

While there may not be anything wrong with being common, it certainly is also not a sign of distinction or achievement. However, it often appears that many have as their primary goal and objective

By: mml Self Improvement > Positive Attitudel July 26, 2012 lViews: 176

We have all heard the many adages about how winning or being a winner is dependent on persistence and perseverance. However, most of us treat that adage as empty rhetoric, and simply avoid situations

By: mml Self Improvement > Positive Attitudel July 26, 2012 lViews: 235

We all get angry at one time or another. Some people permit that anger to control them, and they get so absorbed in being angry that they suffer some sort of action paralysis, while others use that

By: mml Self Improvement > Anger Managementl June 15, 2012 lViews: 174

Positive leadership does not mean leading with blinders on, or being a Polyanna personality, or refusing to accept reality, or refusing to recognize, perhaps, that something needs improvement.

By: mml Self Improvement > Leadershipl June 14, 2012 lViews: 181

Having successfully negotiated many hundreds of contracts over more than the last three decades, I have often observed numerous negotiating techniques and philosophies. Perhaps the poorest model has

By: mml Business > Negotiationl April 27, 2012 lViews: 233

Regardless of one's definition of success, or being a success, or being successful, it always must begin with an individual's attitude and thought processes. One of the greatest stumbling blocks that

By: mml Self Improvement > Successl April 25, 2012 lViews: 175

Discuss this Article

comments powered by Disqus