PKF Texas – The Entrepreneur’s Playbook: Budgeting Should be Linked to Strategy

by | Jun 6, 2008 | PKF Texas - The Entrepreneur's Playbook®

Note: Running Fridays in FromGregsHead.comis a continuing series of tips brought to you by Greg Price. These run Saturday mornings during the BusinessMaker’s Radio Show on KPRC 950AM. Audio files can be found on the Entrepreneur’s Playbook page of the PKF Texas website.

How good is your strategic plan? Do your link your strategy to your budget? Most organizations don’t and then they wonder why they don’t accomplish their objectives. As I visit with business executives one interesting thing keeps coming up.   They indicate that they succeed in spite of themselves. My response to them is, “Are you really succeeding?”   Or, are you just lucky. Lucky that your customers need you or the products you represent.

Recently some best practices in strategic planning were released by The Hackett Group in their book The Strategy Gap. This book highlighted eight planning best practices of high performance organizations.

  • Good plans answer key directional questions.
  • Good plans typically address three activities.
  • Good plans-and organizations-are focused.
  • Good plans include all aspects of the business.
  • Good plans link strategies to activities.
  • Good plans are measureable.
  • Good plans include assignments to accountability.
  • Good plans include the recording and monitoring of assumptions.

The key of course is to get Senior Management, Operational Management and Line Management all working on the same things in concert with each other.

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