“Budget” is a life sucking word...


I’m listening to the audiobook, “Winning” by Jack Welch and just came to the chapter “Budgeting - Reinventing the ritual” and the first paragraph rang so true to me that I wanted to share it.

Truthfully, I think the word “budget” is life sucking for an organization and actually hurts sales, innovation, growth and culture. Yes, I believe in responsible management of finances but budgets are not the way.

Jack Welch is one of the most successful CEO’s of all time. Under his management he increased GE’s market capitalization by $400 billion, making it the world's most valuable corporation at the time. Here’s what Jack says:

“Not to beat around the bush, but the budgeting process at most companies has to be the most ineffective practice in management.

It sucks the energy, time,fun, and big dreams out of an organization. It hides opportunity and stunts growth.

It brings out the most unproductive behaviors in an organization, from sandbagging to settling for mediocrity.

In fact when companies win, in most cases it is despite their budgets, not because of them.

And yet, as with strategy formulation, companies sink countless hours into writing budgets. What a waste!”

I can’t tell you how often the word budget comes up in business but I can tell you that it’s a distraction and it doesn’t help move the ball forward to attain goals and expansion.

Focus on the big picture. Vision. Objectives and driving sales revenue and growth and don’t stifle your people culturally with the word “budgets” because it stunts growth both in thinking and action.

People don’t get excited or inspired about budgets, they shrink and suffocate.

Let your people focus on growing, attaining the next objectives over the next mountain and continue to breath life into the company's goals. That’s what they should be focused on.

-Robert

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#budget #robertcornish

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