Beyond Budgeting

Author: Jeremy Hope; Robin Fraser
Publisher: Harvard Business School Press
ISBN: 9781578518661
Published In: April 2003
Format: Hardback , 336 pages
Jurisdiction: International ? Disclaimer:
Countri(es) stated herein are used as reference only

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About the book

The annual budgeting process is a trap. Pressured by fixed targets and performance incentives, managers focus on making the numbers instead of making a difference, meeting set goals instead of maximizing potential. With their compensation at stake, managers often resort to deceitful-even unethical-behavior. In the end, everybody loses-the employee, the company, and ultimately the customer.

Now, finance experts Jeremy Hope and Robin Fraser reveal the results of an intensive study aimed at fixing the broken budgeting process. They argue that companies must abandon traditional budgeting contracts in favor of a radical new model that links performance measurement to evolving competitive benchmarks-and shifts the firm's focus from controlling employee behavior to delivering customer value.

The Beyond Budgeting model is built on the best practices of companies that have successfully revised their centralized planning and budgeting processes. It combines a leadership vision that devolves more authority to operating managers and a finance vision that enables fast decision making through appropriate tools and accessible information. Through vivid examples, Hope and Fraser illustrate how companies can implement these shared visions-and the long-term benefits that accrue from embracing them.

Offering a compelling case for breaking free from the budgeting trap, this book paves the way toward making organizations better places to work for, invest in, and do business with.

Introduction

A new model for budgeting that liberates managers from the annual performance trap.

Controversial: Introduces compelling evidence for why the current model of budgeting doesn't work and how it promotes dysfunctional behavior

Something new: Presents a long-awaited approach for budgeting that allows managers to tie performance measurement to evolving competitive benchmarks

Unique solutions: Shows managers how, in the absence of a traditional budget, they can still satisfy budget-related needs such as setting goals, designing compensation and incentive rewards, and measuring performance

Moves beyond finance. Explains how Beyond Budgeting has both a financial and managerial component to it, and organizations will not achieve true Beyond Budgeting success unless they implement both.

Jeremy Hope and Robin Fraser are Directors of the CAM-I Beyond Budgeting Round Table, a not-for-profit collaborative that looks for better ways of managing performance.