Getting the funds that you need from tight fisted management is an ongoing process. Cash outlays are justifiable either by dollars they bring in or dollars they stand to save for the organization. Cash outlays are always risks. Justify your risks in proportion to riskier ones they have previously funded. Validate your worth to the overall company operation.
Under the rules of supply chain dynamics, one must study your supplier relationships, formalize a plan of outsourcing and develop collaborations.
Methods of changing the way that you go for funds include:
- Take money with you. Show returns or savings on previous appropriations.
- Position your request as an investment, not a cost.
- Sell management-clients on acquiring more returns on their investments, not just on making further investments.
- Be visible when funds are flowing.
- Reduce management’s risk in doing business with you.
- Be a consistent producer of profit-improving outcomes, not just a spotty or hit-and-miss producer.
Corporate management has three alternatives for funding every department: (1) Must fund. (2) May or may not fund. (3) Will not fund. The three horsemen of funding are: (1) How much. (2) How soon. (3) How sure.
These are ways to advance your funding process:
- Put money in management’s pockets.
- Get to the front of the line for funding requests.
- Acquire an upper-management mindset.
- Condense the funding cycle.
- Become top management’s partner in efficiency of operations.
Base Budgets on Value… Not on Cost
1. Readily measurable values:
- Time and cost of product development-service delivery cycles.
- Reject, rework and make-good rates.
- Downtime rates and meantime between downtimes.
- Meantime between billings and collections.
- Product-service movement at business-to-business levels.
- Product-service movement at retail levels.
- Product-service movement in the aftermarket (resales, repeat business, referrals, followup engagements).
2. Values in terms of savings:
- Time and motion savings.
- Inventory costs.
- Speed of order entry.
3. Values in terms of efficiencies:
- Meantime between new product introductions.
- Forecast accuracy, compared to actual results.
- Speed, accuracy and efficiency of project fulfillment.
- Productivity gained.
- Continuous quality improvement within your own operation.
4. Values benefiting other aspects of the company operation:
- Quality improved on behalf of the overall organization.
- Creative new ideas generated.
- Empowerment of employees and colleagues to do better jobs.
- Information learned.
- Applications of your work toward other departments’ objectives.
- Satisfaction in your service elevated.
- Voiced-written confidence, recognition, referrals, endorsements, etc.
- Capabilities enhanced to work within the total organization.
- Reflections upon the organization’s Big Picture.
- Contributions toward the organization’s Big Picture (corporate vision).
7 Steps Toward Getting Your Budgets Accepted More Readily:
- Commitment toward strategic planning for your function-department-company.
- Know your values.
- Refine your values.
- Control your values.
- Add value via internal services.
- Take ownership of your values.
- Continue raising the bar on values.
7 Stages in Making a Case for Business Funding:
- Link to a strategic business objective.
- Diagnose a competitively disadvantaging problem or an unrealized opportunity for competitive advantage.
- Prescribe a more competitively advantaged outcome.
- Cost the benefits of the improved cash flows and diagram the improved work flows that contribute to them.
- Team the project.
- Maintain accountability and communications toward top management.
- Contribute to the organization’s Big Picture.
Reasons for Goal Setting:
- Human beings live to attract goals.
- Organizations get people caught in activity traps… unless managers periodically pull back and reassess in terms of goals.
- Managers lose sight of their employees’ goals. Employees work hard, rather than productively. Mutually agreed-upon goals are vital.
- People caught in activity traps shrink, rather than grow, as human beings. Hard work that produces failures yields apathy, inertia and loss of self-esteem. People become demeaned or diminished as human beings when their work proves meaningless. Realistic goals can curb this from happening.
- Failure can stem from either non-achievement of goals or never knowing what they were. The tragedy is both economic and humanistic. Unclear objectives produce more failures than incompetence, bad work, bad luck or misdirected work.
- When people know and have helped set their goals, their performance improves. The best motivator is knowing what is expected and analyzing one’s one performance relative to mutually agreed-upon criteria.
- Goal attainment leads to ethical behavior. The more that an organization is worth, the more worthy it becomes.
- Most management subsystems succeed or fail according to the clarity of goals of the overall organization.
How to Find Goals:
- Examine problems.
- Study the organization’s core business.
- Strengths, Weaknesses, Opportunities and Threats.
- Portfolio analysis.
- Cost containment.
- Human resources development.
- Motivation and Commitment.
Make Goal Setting a Reality:
- Start at the top.
- Adopt a policy of strategic planning.
- Strategic goals and objectives must filter downward throughout all the organization.
- Training is vital.
- Continual followup, refinement and new goal setting must ensue.
- Programs must be competent, effective and benchmarked.
- A corporate culture must foster all goal setting, policies, practices and procedures.
- Focus on important goals.
- Make goals realistic, simple and attainable.
- Reward risk takers.
- Recognize that trade-offs must be made.
- Goals release energy.
- Information leads to dissemination, leading to teaching-training, leading to insight, leading to understanding, leading to knowledge, leading to wisdom.
- View goals as long-term, rather than short-term.
Rules for Budgeting-Planning:
- Use indicators and indices wherever they can be used.
- Use common indicators where categories are similar, and use special indicators for special jobs.
- Let your people participate in devising the indicators.
- Make all indicators meaningful, and retest them periodically.
- Use past results as only one indicator for the future.
- Have a reason for setting all indicators in place.
- Indicators are not ends in themselves…only a means of getting where the organization needs to go.
- Indicators must promote action. Discard those that stifle action.
- Discipline at work is accepted, for the most part, voluntarily. If not voluntarily accepted, it is not legitimate.
- Discipline is a shaper of behavior, not a punishment.
- The past provides useful insights into behavior, but it is not the only criteria to be used.
Applying Developmental Discipline:
- Rules and regulations must be known by all employees.
- Disciplinary action should occur as close to the time of violation as possible.
- The accused person must be presented with the facts and the source of the facts.
- The specific rule that was broken must be stated.
- The reason for the rule being enacted should be stated.
- The accused person must be asked if he-she agrees with the facts, as stated. If the reply is affirmative, he-she should justify the behavior.
- Corrective action should be discussed in positive and pro-active terms.
Ways in Which Goals Improve Effectiveness:
- Defines effectiveness as the increase in value of people and their activities as resources.
- Recognizes that humans are achievement and success creatures.
- Goals infuse meaning into work and work into other aspects of life. Life is fully lived when it has meaning.
- One cannot succeed without definitions of success. One must expect something to achieve success.
- Failure is inevitable and is the best learning curve for success.
- One’s goals start from within, not from work situations. The goal-oriented person adapts to the work environments.
- Collaborations with other people create success. One cannot be successful alone or working in a vacuum.
- One is always dependent upon other people, and other people are dependent upon you.
- Commitments must be made to other people.
- One must view the future and change as affirmative, in order to succeed.
- Knowledge of results is a powerful force in growing and learning.
- Without goals, one cannot operate under self-control.
- Objectives under one’s own responsibility helps one to identify with the objectives of the larger organization of which he-she is a part. Sense of belonging is enhanced.
- Achieving goals which one set and to which one commits enhances a person’s sense of adequacy.
- People who set and are striving to achieve goals together have a sense of belonging, a major motivator for humanity.
- Because standards are spelled out, one knows what is expected. The main reason why people do not perform is that they do not know what is expected of them.
- Through goal setting and achievement, one becomes actualized.
- Goal setting creates a power of one’s life…especially the part that relates to work.
- With goals, one can be a winner. Without goals, one never really succeeds…he-she merely averts-survives the latest crisis.
About the Author
Hank Moore has advised 5,000+ client organizations worldwide (including 100 of the Fortune 500, public sector agencies, small businesses and non-profit organizations). He has advised two U.S. Presidents and spoke at five Economic Summits. He guides companies through growth strategies, visioning, strategic planning, executive leadership development, Futurism and Big Picture issues which profoundly affect the business climate. He conducts company evaluations, creates the big ideas and anchors the enterprise to its next tier. The Business Tree™ is his trademarked approach to growing, strengthening and evolving business, while mastering change. To read Hank’s complete biography, click here.