Budget Planning: Key Takeaways from Working With a C-Suite Executive

By: Carlos Castelán, Managing Director at The Navio Group

For many of us, autumn means that the kids go back to school, Football season starts, and winter starts to beckon.  For many companies, fall is the time to think about next year’s annual operating planning (AOP) to establish budgets.

The AOP cycle often creates a lot of confusion and stress for leadership because plans can change quickly. Plus, it is difficult to budget for requests 12 months in advance of today’s rapidly changing environment.  Having supported a Fortune 500 CIO managing their planning and budgeting, I’ve come away with some key takeaways to help marketing, creative, and digital organizations through the budget planning process:

Establish a clear vision and roadmap for the organization

• Where do you want to be as an organization in three to five years?
• What technology capabilities do you need to build to get there?
• What projects do you need to accomplish in order to meet/exceed organizational goals?

The process of establishing a clear vision helps prioritize the various requests that can overwhelm an organization.  Working cross-functionally to align goals at the C-suite and VP-levels and sharing them across the organization makes it easier to say “no” to projects that don’t advance the vision of the organization as a whole.

Build a roadmap and identify resources needed to support those activities and projects.

• What projects does the organization need to accomplish in the next year to attain the three or five-year goal?
• What mix of full-time employees vs contractors is right for the organization to achieve those goals?
• Does the organization have the infrastructure to accomplish the projects on the roadmap?

With the identification of a project roadmap for the next year, it’s a good time to check-in to ensure the organization is properly structured to support all the initiatives.  Are the right managers in place or are some of them overloaded based on how the projects skew?  As part of this question around structure, it’s important to establish a strategy around full-time employees and contractors.  The flexibility of having contractors allows the organization to bring highly specialized individuals for the right projects without having to increase your long-term general & administrative spend through full-time employee agreements.  

Create clear governance around budget and roadmap management.

• Who manages and tracks spend throughout the year?  Does that fall on marketing, creative, finance, or someone else?
• How are projects added or removed from the roadmap?
• What’s the appropriate cadence to review budgets and hire full-time employees or contractors in alignment with the roadmap?

After building a roadmap and subsequent budget, it’s critical to ensure that the budget is well managed (total cost of ownership on a project, invoice tracking, capitalizing spend on asset creation, etc.). Not all companies may be able to afford or want to dedicate an employee to the management of the budget and roadmap.  Nevertheless, it’s important to have a strategy to ensure successful execution and implementation of the budget.

Building budgets in a rapidly changing environment is hard!  However, by establishing a process through which the organization identifies goals, and aligns resources to those goals, the conversations can be more collaborative and objective.

Carlos is the Managing Director of the Navio Group, a Celarity partner, which develops tailored strategies for retail and consumer-focused companies.  The firm generates insights using a data-driven and customer-centric approach while leveraging the team’s deep operational experience to drive value for clients.  Carlos is a recent graduate of Harvard Business School and lives in the Twin Cities with his wife, Kirsten, and two dogs – Harvey and Thor.

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