BorealisSend the budget geeks out into the ColdSend the budget geeks out into the Cold

Marciano Alves

Graham Hatch

Adrienne Burton-Lorite

Mohamed Lo

Timothy Piwonka-Corle

Dang Tiet

Budget Headaches Dead document!

Sector too volatile - “Our products and supplier markets were changing so fast that the budget was out of date within weeks.”

Corporate culture - “People worked hard to produce a detailed document, put the document in a large binder, and sadly never looked at it again.”

Gaming Forecast and Targets are the Same. - “Hinders

decentralization of decisions and responsibility and is a barrier to customer responsiveness.”

Time consuming Unwieldy to Communicate - “Plant workers had little

understanding of the corporate strategy”

Move from Photos to Video

Abandon the annual budget process Benchmarking against competitors Change management process

Roll out in steps

The Tools Four specialized management tools

Rolling Financial Forecast Pay no longer based on budgets. Gaming Frequent updating. Dead Document Less data collection and number crunching.

Time consuming Balanced Scorecard

Variable Cost, Fixed Cost and Operating Margins Unwieldy Communications

The Tools Activity Based Cost Management (ABCM)

“Highlighted the impact and costs of expected and unexpected unused capacity.” CHANGE in Corporate Culture

Investment Management Decision process for projects based on

marketplace and customers Dead Document

Decentralized the process CHANGE in Corporate Culture

The impact Sales increase by 1 Billion Euro in 2 years.

More accurate investments by the company ROCE decrease

Our hypothesis is that medium and small investments increased - Fixed costs increase!

Variable cost increased! - due to external factor beyond the company’s control.

Exchanged MARGIN for VOLUME Difficulty to control expenses in tough economic

times Business timing was BAD