Posted on 02/05/2025 2:27:32 PM PST by TigerClaws
“An operating, planning, and budgeting process that requires each manager to justify their entire budget request in detail from scratch (hence zero-based) and shift the burden of proof to each manager to justify why they should spend any money at all.”
1. “But that’s the way we’ve always done! We have to keep doing it!”
2. “But we’ve sunk so much money in XYZ. We can’t walk away now and leave all that money behind.” (the “Sunk Cost Fallacy”)
One of the problems with ZBB is that most people involved in developing budgets have no idea how “that expense got there”. Explaining the concept of “cost driver” to midlevel managers is much like teaching a dog to type an original thought.
You had to go there ... der Fuhrer
Helped companies like Microsoft do sales budgeting for years. They do “Top down/bottom up” where leadership creates top down revenue expectations. Staff creates bottom up of what they would be comfortable committing to. Final budget is after negotiating differences.
Blue Oyster Cult fan.
Forget the cowbell.
I need more pointless ümläüts.
😀
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