4 Ideas to Improve Your Budgeting and Forecasting Process

There are few business owners who really enjoy the process of sitting down to perform their budgeting and forecasting duties. The fact of the matter is it's all but inevitable that you will end up shorting, or create the perception of shorting, one or more of your company's departments. It's a well known fact that every department in most businesses wish to receive as much of the budget as possible. The good news is there are certainly actions you can take that will help you reduce the amount of morale issues that you'll run into whenever you go through the budgeting and forecasting process.
1. Cooperate with Your Team
It's all but guaranteed that making the decision to figure out all of your budgeting and forecasting plans on your own without taking into consideration the direct input of each of your departments will lead to a lot of resentment from your team. It's better to cooperate with them from the start.
It can sometimes be difficult to find the free time and the resources to meet with representatives of all of your company's departments, but it's absolutely necessary. There are a few basic departments that you need to meet with (such as finance, HR, etc.) but overall the more department heads you meet with the less dramatics you're likely to engender.
2. Sincerely Solicit Opinions
Make sure that when you set up these meetings that you don't do so simply as a token action, just as lip service to placate them before you go ahead and just do whatever you want. Hold a legitimate and thorough conversation with your department heads, explain to them the limitations and the general changes that you all need to deal with in the coming quarter or year, and then you need to solicit each of their opinions on how their department can best meet these challenges. Not only are your department heads going to appreciate being let in on the process, but they will also be able to provide more specific solutions to the problems you need to meet as a team due to their ground level understanding of your company.