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- Feb 24, 2023
- 2 min read
Exposing the Myths (and Realities) of Zero-Based Budgeting - Part 1
Zero-based budgeting is a valuable tool for organizations that are looking to improve their financial performance and control costs. It requires a clear understanding of the organization's goals and objectives, but the benefits of increased efficiency, cost control, and improved financial performance make it a worthwhile investment.
In this series of blogs, we explore some misunderstandings and realties of ZBB as outlined by Shaun Callaghan, Kyle Hawke, and Carey Mignerey of McKinsey and Company.
Myth one: ZBB simply means building your budget from zero.
Reality: ZBB is a repeatable process to build a sustainable culture of cost management.
Zero-based budgeting is much more than building a budget from zero. World-class ZBB efforts successfully build cultures of cost management throughout the organization by using a structured approach to facilitate cost visibility, cost governance, cost accountability, and aligned incentives. Fortunately, the culture shift isn’t left to chance. We believe that there is a proven, step-by-step approach to implementing successful ZBB programs, and when this implementation is done well, ZBB makes cost management a part of the way every employee works on a daily basis.
Read the full article here: https://www.mckinsey.com/capabilities/strategy-and-corporate-finance/our-insights/five-myths-and-realities-about-zero-based-budgeting
Ramesys is an all-in-one budgeting, forecasting and reporting platform, purpose-built for the mining industry, that offers complete cost visibility across the entire organisation.
Our goal is to make it easier for mining companies to achieve a transparent understanding of their cost performance, develop a cost-conscious culture and create a single source of truth that helps key stakeholders make better decisions, faster.