Beyond Finance Managers, CFOs, and CEOs: Leveraging Your Organizational Budget To Benefit The Entire Organization

We all know that our budget is a critical financial management tool for finance managers, CFOs and CEOs, but it can also be used in a number of other ways. Here are a few additional uses that can reap positive results:

1. Embed responsibility for line item budget management in the job responsibilities of everyone on your senior management team. Creating projections, managing a budget, and reporting regularly on budget v. actual is a critical management skill for your entire team, not just your finance manager or CFO.
2. Empower your staff and Board at all levels (even front lines) with a budget overview. High level overviews might include the major line items with pie charts, with more detailed reviews on an as needed basis. When your entire team knows the goals that you need to achieve for both expense management and revenue, they'll understand your decision making in a new way, and be more invested in helping reach those goals.
3. In addition to regular income/expense statements and balance sheets, include budget v. actual statistics in routine board information (either rolled up or in detail depending on your organization). Highlight line items that are doing well in green, caution areas in yellow, and "yikes-we're-way-off-target" areas in red so that you are making it easy for your volunteer leaders to grasp trouble areas in advance.
4. Incorporate regular budget revisions into your planning process (many organizations do revisions quarterly or semi-annually). This allows you to keep the budget alive and relevant, and may drive key decisions before you head into a trouble zone. Of course, if you're completely on track in all areas, no revision may be necessary...just give lots of praise to your team instead! You may even want to establish some team incentives that are tangible rewards.
5. Most funders and donors ask for a copy of your current year budget in addition to past year financial statements and project-specific budgets. Even if not requested, make sure to provide it and attach a discussion of the figures so that they can understand the policy decisions and numbers that drive each significant line item. You will have answered most of their questions in advance, and they'll know that you have a strong grasp on your finances.

How else do you creatively use your budget as a tool?