Blog #27: Stuck in Another Annual Budgeting Circus?
It's annual business budgeting season in New Zealand for FY27. March 31st is looming. You know what's coming – finance chasing everyone for numbers (when in fact they already know what numbers they want you to want), late requests to justify assumptions and plans, and tense budget negotiations disguised as forecasting.
Here's a truth, often touted, rarely executed: if your S&OP or IBP is actually doing its job, the annual budget should be – well – boring.
Does It Have to Be Such a Battle?
For most companies, the budget is the only time finance folk properly look ahead. Eleven months of performance reporting, then suddenly they care about next year – all crammed into a few painful weeks (often dragging into months). Meanwhile, your S&OP/IBP has been looking forward 12, 18, even 24, months every month.
But who's been absent? Likely Finance.
We All Know That Finance Manager or CFO
Sat through IBP meetings like they were an inconvenience. Contributed little. Mentally elsewhere. Tapping out emails while everyone pretended they were "present". Then complained in private that the process wasn't giving them anything.
Or worse – didn't complain at all. Just remained silent. Quietly disengaged. That's the more insidious version, because at least a complaint is a signal something could change.
Mate. You get out what you put in.
You don't get fit by watching others exercise. Why would IBP be any different?
What if that same CFO finally started engaging – properly, not just attending – suddenly the process will start working for them. Stop observing and start challenging. Ask why the supply plan assumed lead times that haven't been true for six months. Push back on marketing's revenue assumptions. Make Finance own the scenarios, not just receive them.
Radical, I know.
The Payoff
When finance is genuinely involved all year, budget season changes.
Your forecasts have already been argued over. Assumptions are documented – not invented on the spot. Risks and opportunities already have numbers and names against them.
Budget simply becomes a snapshot of what you already know. A formality. A significant non-event.
If your budget process is still a painful circus of late nights and last-minute scrambles, maybe it's time to ask what's been happening the other eleven months.
And if you're a CFO who's been sitting in the audience waiting for IBP to deliver – maybe it's time to pick up the whip and step into the ring. Those lions won't tame themselves.
Is your budget season a circus? Are you the lion tamer – or just hoping the lions don't bite?
Find me at www.planninglab.co.nz
#IBP #S&OP #BusinessPlanning #Finance #SupplyChain