You may see yourself as a “numbers person,” but have you ever stopped to realize that you’re also a salesperson? This is especially true during budget season. In order to receive final buy-in for the company budget, you need to educate and sell to your organization’s stakeholders and decision-makers.
In many ways, the budget process aligns with steps in a sales funnel. Below are a few tips gleaned from the sales process that will help you create a winning budget season – and, ultimately, close the deal.
Step 1: Establish the relationship
Budgeting is a group effort. While the finance or accounting department may be leading the process, responsibilities are usually divided between department managers. Understandably, not all managers enjoy the budget process, but there are ways to make it less burdensome and more streamlined – and it all starts with building relationships with your budget team.
To create a sense of team, gather everyone who will be involved in the budget process for a kick-off meeting. Address all questions and help everyone understand how their rolls affect each other and the project as a whole.
It’s also important to undersell and over deliver. That is, set clear, realistic expectations for those involved in the budget process from the start and then follow this with unexpected rewards, such as coffee and bagels during budgeting meetings or a celebratory lunch when deadlines are met. This makes the budgeting process more motivational than punitive.
Step 2: Identify needs
One of the first needs to address is the timeline. Begin by taking time to reflect on past budget seasons. Review previous timelines for bottlenecks and make adjustments. Also look at what makes this year different from previous years – such as new software or new personnel who will need to be allotted extra time for budget training. When setting the ultimate deadline, turn to the decision-makers’ calendars as they will need to be available to make final approvals.
In addition to setting the timeline, it’s also important to identify the company’s strategic goals. Share these with the budget team and determine how each department will contribute toward these goals and what resources may be needed.
Step 3: Create a solution
Once needs are identified, the management team can begin putting pencil to paper. To help them get started, include previous budgets to use as a baseline. To track progress, use a Gantt chart to visually display individual budgeting responsibilities and how much progress has been made.
Check in with your team frequently to provide feedback and remind them that you have an open door policy. Review budget drafts throughout the process so that you understand the back stories and will be able to easily address questions during approval time.
Step 4: Deliver & close
Once all budgets are complete and ready for approval, it’s time to switch gears and sell to decision-makers – the CFO, CEO, etc. Now that the budget is in your hands, it’s important to take ownership and be confident. To aid your discussion, use historical data, comparing month over month and year over year, and provide visuals, such as charts and graphs.
If the metrics are an improvement on past years’ performance, they will do most of the selling for you. While you want to error on the conservative side, you may get pushback if you go too far. Like sales, you want to give decision-makers what they want, but you need to be as honest and upfront as possible.
When closing, obtain written agreement to make sure everyone is held equally accountable for adhering to the budget, and the results.
Step 5: Follow up
Once the final budget is approved, send a copy to everyone involved so that they can review what they created – and, most importantly, follow it. Regroup with the budget team to review the season – what went well and what didn’t. Take note of recommended changes for the next budget cycle.
Like the sales funnel, in order to successfully create a budget, you need to master each step in the process to avoid delays and receive buy-in. While you need to understand the numbers, you also need to be able to sell the story behind the numbers.