Guest Post on the Ivalua Blog: The Annual Budget Process as a Contact Sport
If your company closes its books with the calendar year, there is a good chance the budget review process is quickly approaching. With it come the games departments play – and they are not child’s play by any means. The annual Budget Games are at minimum a contact sport, and at their most extreme a blood sport.
The rules are timeless and well known:
- The largest budget carries with it the most influence in the organization. We are expensive, so therefore we are valuable.
- Requests for increases indicate big plans and are intended to communicate vision, while a group that can do the same or more with less lacks ambition and imagination.
- Perhaps the most dangerous rule for procurement is: if you don’t spend it, you lose it. This unfortunately equates realized savings with a loss of influence, a frustrating indication of how our efforts are often perceived.
Procurement’s role in the process varies greatly from company to company. As cutthroat as the Games can be, there is no such thing as a bystander and each role has its own advantages and liabilities.