From the perspective of different stakeholders, budget plays different roles. For example, it is effective to implement strategic objectives for investors; For management, it is to make plans and guidance quickly and accurately; The financial department implements it effectively; For enterprise managers, it is to support the evaluation system; For business executives, it is to establish a business system that matches the budget.
In short, comprehensive budget management is a management tool for enterprises. Different enterprises use the tool of comprehensive budget, which has both characteristics and individuality. I think that different enterprises need to consider the following three factors when making a comprehensive budget from a macro perspective.
Industry attribute
Every company must belong to a specific industry, and the industry attribute determines the strategic map of a company, which is the core of an enterprise. Comprehensive budget and rolling forecast are the top embodiment of strategic map.
For example, in a large manufacturing group, the management focus of the group company is the completion of the annual plan and the fund revenue and expenditure plan. The production plan MPS is made according to the company's annual business plan, the purchase plan is made according to the purchase lead time and inventory control strategy, and the order is project-oriented, and the revenue cost is confirmed according to the accrual basis. Then the company's comprehensive budget will reflect the characteristics of this industry.
Another example is a large beer group, where the beer output is greatly influenced by the season and has strong fluctuation. Typical channel control sales strategy, on the basis of stable cash flow, adjusts the production line and inventory according to seasonal fluctuations, and can also transfer some inventory pressure to the next level through channels. Then its comprehensive budget should have the unique attributes of this industry.
Mode of operation
The impact of the above-mentioned industry differences on the overall budget is objective, but we will find that even in the same industry, companies are very different and their operating modes are different.
For example, in the jewelry industry, some jewelry groups adopt offline experiential selection, online unified sales orders, centralized logistics distribution, and centralized management of design and production, involving key contents such as inspection and anti-counterfeiting, and supporting customer customization. This method itself has a strong e-commerce color. However, some big companies use stores to enter major shopping malls, or official website promotes the latest and hottest styles, but they still need to go to stores to buy them. Quality inspection, inventory and very important after-sales service are scattered to various stores. Some of these stores may be directly operated, with unified management of people, finance and materials, and some may join in and operate independently. This capital-intensive industry is facing the end consumers, and the industry competition is also full, so it requires higher accuracy of the budget. Enterprises with different operating models have huge differences in budget models.
Generally speaking, the operation mode is divided into financial control type and business control type. Financial management and control enterprises are decentralized, which has the advantages of strong flexibility of branches, easy to grasp investment opportunities in time, high enthusiasm of branch managers and low management expenses of headquarters. At the same time, they also have some disadvantages, such as it is difficult to co-ordinate and use funds at low cost within the group, it is difficult to control the foreign investment of branches well, it is easy to form a small and comprehensive, the efficiency of resource utilization is low, and there is a lack of coordination between branches. The management and control of enterprises are centralized, which can better implement, control and coordinate strategies. Each business department can obtain low-cost funds, reduce the blindness of investment, reduce business risks, and facilitate the measurement of the business situation of the business department. However, the formulation of the group's strategic and financial plans lacks the participation of departments, which leads to conflicts between departments, complicated coordination between headquarters and high management costs.
Most domestic enterprises adopt a compromise management model. This model focuses on strategy, key business planning and result evaluation. The parent company does not replace its subsidiaries for direct management, but carries out decentralized control on the basis of centralization. This model will put forward higher requirements for the parent company. The key of this model lies in whether the business of each business department is closely linked, whether centralization is conducive to the formation of scale advantages, and whether the management and control ability of the headquarters is strong enough.
The Relationship among Enterprise Strategy, Budget and Performance Evaluation
The core function of the budget is to realize the business plan of the enterprise and complete the established strategic objectives of the enterprise. Then, from the formulation of strategic objectives to specific business activities, they are connected in series through business processes, which is called business drive.
Generally speaking, the general business driving mode is as follows: Through the analysis of external driving factors, such as competitor information, customer feedback, policy promulgation, etc. Integrate the development direction of each business unit, determine the strategic objectives of the enterprise, and then refine the plan, which is a strategic and top-level design; Combined with each business segment, the detailed business plan of the enterprise is formed, including various quantitative indicators, not only financial, but also business data. Through the financialization of these operating indicators, the operating budget of each sub-item is formed.
Every enterprise will have its own specific business driving mode, which is the process architecture, the core competitiveness, the embodiment of corporate culture and its own business operation mode. The operation of business process carries a lot of attributes and information, which reflects the causal relationship at all levels of business execution.
In budget and forecast analysis, the design of formulas and forms is an abstract reflection of business data and its driving factors. Because each company's business-driven model is different, each company's formula and table design will be different. This is also the most personalized part of the enterprise's comprehensive budget.