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Budget – Strategy – Controlling
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Our understanding of these words:
Objectives
Ways to achieve the objectives
Evaluation of divergences and counter steering
The central issue in the area of budgeting – strategy – controlling are the objectives (strategy). The strategy is build upon objectives – these can either be of quantitative or qualitative nature.
The budget is combining those objectives and expresses them in numbers. Here controlling is understood as an umbrella term for providing, preparing and analysing facts for the target – oriented steering of your company.
Simplified this means that through nominal and actual value comparisons, variations are detected and unwanted developments are worked against.
Of course controlling can mean lots of other things, but the question here is if this complexity is really necessary and whether without this complexity the same results can be achieved?
The use of planning- and controlling instruments supports you to steer your company.
Through the analysis of the past and the planning of the future you are always well informed about your company. Nominal and actual value comparisons, on a regular base, will detect negative variations immediately. With an action plan it is possible to counteract negative developments faster and more efficient. Changes on the market and changes of the competitors can be recognised much better and it is possible to work against those changes at an early stage.
When negative trends are observed not until the balance sheet review, often some time has already elapsed and it is possible that it is already too late!
When abnormalities (e.g.: strategic crisis) are detected at an early stage, a bankruptcy or an insolvency can be averted. An extrapolation supports you to illustrate the consequences of the abnormalities on the profitability for the remaining business year. On the basis of our
long-time experience we trust our planning tool “professional planner”.
We avoid bombarding you with all the figures but instead prepare the information graphically. Selected key figures assist you to steer your company in a more efficient manner. Our goal is to inform you about the most important key figures at one page.
- 1. The evaluation of qualitative objectives
- 2. The evaluation of quantitative objectives
- 3. Reviewing, optimise tax liability, legal structure and employee involvement
- 4. Create and discuss budgets – possible bank appointment (rating)
- 5. Continuous target/actual comparisons and analysis of abnormalities
- 6. Key figures – management cockpit
- 7. Forecasts
