6 Steps for linking corporate strategy to the budget

The budget is supposed to be the tool by which an organisation transforms its strategy into action. Unfortunately, up to 60 percent of organisations do not link their corporate strategy to their budget.

Ask any three people in an organisation why they budget and you are bound to get three different answers. They usually include such statements as, “It is something we do every year,” “It is a big stick we use to cane those who don’t perform,” and “It is the mechanism for setting the managers’ bonuses.” Is this really the intended purpose of budgeting? This paper will show you how to link these related management processes and strengthen your business performance management capabilities.