Management Rules: 50 New Rules for Managers

CHAPTER 17

MANAGING YOUR BUDGET

Managing budgets is one of the basic disciplines which all managers must master. There is both a logical and political reality to managing budgets. That means managers have to master both the discipline and the game-playing of budget management.

First, it helps to understand the annual budget cycle. It always ends in a crisis. Most of the time, the crisis is about closing a performance gap. The gap may be in another part of the firm, but you will still be expected to help close the gap. The gap comes about because departments overspend, costs go up, sales flag. It does not matter why the crisis came about: you will be expected to help out.

By the time the crisis comes, it will be too late to close the gap by increasing ...