At this point in the year, budget season is here (or already begun for you) and 2022 planning is underway. Financial teams usually plan to finalize budgeting for the following year in December and the importance of going into a new year with an established budget cannot be overlooked.
Setting plans and identifying opportunities that will keep the business operating as well as accelerating growth all fall into the budgeting process. But the budgeting process does not have to be a painful one. Preparing early can improve overall efficiencies and we wanted to share with you 3 ways to help overall prepare for the process.
Before getting too far in the budgeting process, those that are handling the planning and budgeting for the coming year need to collaborate with executive leadership and review the expectations and goals for different areas of the business. Reviewing things that worked, or didn't work, and adjustments that are to be made set the groundwork for budgeting where funds will be used in the coming year. Once the goals and expectations are established, those handling the planning and budgeting must identify all who will be involved in those processes and involve them with setting the budget moving forward. Budgeting works best when all associated parties are involved.
Financial professionals spend hours collecting the necessary data for budgeting and a lot of that time depends on how organized the data is within the company. In-house data can be a mess at times, especially when manual processes are in place that allows room for human error. This causes hours to be spent on reconciling and organizing just to then be able to start the actual budgeting process.
A cadence of the collection can be established to clearly outline all areas that data is required to be collected from and structure the collection process. During this process, areas of concern that cause delays or bring errors to attention should be corrected to ease the budgeting process moving forward.
As with any business process, efficiency is a top priority. How can the budgeting team make it through budgeting season, but do so efficiently and effectively? There is no one-size-fits-all solution to doing this, but here are several strategies and ideas that are proven to help in this situation:
Preparing yourself early in the annual budgeting season is crucial to having a meaningful and successful budgeting cycle. Using available tools and automation help keep a company more organized, efficient and makes the process easier all around. You will certainly be thanking yourself at the end of the process by implementing some of these tips.