12 Ways to Budget Better

Cathy
Fregelette
Financial Practice
Director,
BroadPoint
John
Herbstritt
Chief Solutions
Architect,
BroadPoint
Nils
Rasmussen
CEO,
Solver
© 2016 BroadPoint Technologies | Slide 2
Joseph
Janela
CFO,
APhA

12 Ways to Budget Better in 2017
Cathy Fregelette and John Herbstritt
APhA Case Study
Joseph Janela
Solving the Problems with BI360
Nils Rasmussen
Closing Comments and Q&A

Budget
Operate
Strategize
Align Your Strategies
and Budget
1. Keep your eye on the goal
2. Get the right people
involved
3. Meet in the middle
4. Align your
technology to support
your strategy
Build Your
Operational Budget
5. Choose the right tool for the job
6. Standardize & fortify the templates
7. Monitor workflow and approvals
8. Lock down your budget
Live with and
Love Your Budget
9. Implement an
“early warning” system
10. Roll your forecast forward
11. Start planning early
12. Build one source of the truth

Budget
Operate
Strategize
That’s why nearly 1 in 3 associations don’t do it – and
those that say they do, 19% don’t even write it down!
Your strategic plan must drive your
budget, and your budget must be
allocated among your strategic
initiatives. Period.
 Do you have an actionable strategic plan?
 Do you link your financial budget to drive your
strategic outcomes?
Strategic planning is difficult

RED FLAGS
 Do you have a roadmap for your business?
 Are you monitoring indicators related to you eco-
system?
 If you ask 10 people what the goals are, how many
different answers will you get?
BEST PRACTICE
 Introduce how organizational goals actually link to
initiatives
 Set SMART goals to track progress
 Align your strategic plan to
monitoring mechanisms
#1 – Keep your eye on the organizational goal

#2 – Get the right people involved
RED FLAGS
 Finance or Operation teams are disconnected
from executive strategic planning
 Limited insight on the progress of your
division/ department/ fund/ project managers
 Manager wearing multiple hats
BEST PRACTICE
 Revisit your organization chart
 Identify teams and roles to ensure buy-in to
the plan

#3 – Meet in the middle
RED FLAGS
 Cannot meet strategic goals with budget
process
 Top-down strategy does not match bottom-up
team member input on a consistent basis
BEST PRACTICE
 Realign operational plans to achieve strategic
goals
 Establish and enforce your budget alignment
through a central database process

#4 – Align technology to the strategy
RED FLAGS
 Strategy PowerPoint Budget Spreadsheets
 Difficult to get insights from financial system
to understand progress against goals and
strategic initiatives
 Key operational information is missing in
budget
BEST PRACTICE
 Financial System – Configure it to report on
your strategic progress
 Other Systems – Make necessary changes to
other systems to provide critical data

Budget
Operate
Strategize

#5 – Use the right tools for the job
RED FLAGS
 A spreadsheet only approach resulting in
multiple data sources
 Cutting, pasting & re-entering
the same data
 Unstable macros
 No version control
 Manual consolidation and roll-up
BEST PRACTICE
 Approach your budget with an integrated set
of tools

#6 – Standardize & fortify budget templates
RED FLAGS
 Different spreadsheets per department or
manager
 Provided templates not being used
 Template being altered or changed
BEST PRACTICE
 Build a standard template and share it with
your team
 Tie your template to the data source
 Lock down the ability to modify templates

#7 – Monitor workflow & approvals
RED FLAGS
 No structure for approvals
 Unable to track the progress of the budgeting
process
BEST PRACTICE
 Create a collaborative portal for teams and
budget managers
 Formalize the flow of approvals
 Provide real-time visibility of budget status

#8 – Lock down your budget
RED FLAGS
 Budget is not finalized
 Budget is not uploaded into your financial
system or your budget database
 Unauthorized budget changes post board
approval
BEST PRACTICE
 Implement system controls to restrict budget
entry or changes

Budget
Operate
Strategize
Manual & Retrospective
Your budget has been approved,
but now that means you need to
live with it… and within it!

#9 – Implement an “early warning” system
RED FLAGS
 Caught over-budget and too late to react
BEST PRACTICE
 Provide stakeholders with year-to-date actuals
vs. budget in real time
 Implement a solution to monitor the
conditions on a timely basis
 Configure automated alerts for over/ under
target

#10 – Roll your forecast forward
RED FLAGS
 Relying on month-old financial data to make
critical business decisions
 Unable to project where you will land at the
end of current period… or fiscal year
BEST PRACTICE
 Provide a view of the year with your actual,
budget & forecast to-date
 Reevaluate assumptions and adjust forecasts
based on changes in market conditions

#11 – Start planning early
RED FLAGS
 A “Big Bang” budget approach near year-end
 Limited to no forecasting
BEST PRACTICE
 Reforecast on a regular basis to be a step
ahead for next year’s budgeting process
 Automate estimates of future periods based
on your 12 month trajectory

#12 – Build one source of the truth
RED FLAGS
 No one place to go for the latest numbers
 Every department has its own method for
monitoring and managing budget
BEST PRACTICE
 Deploy common portal to entire organization
for collaboration on the “GBU”
 Adoption and access for managers &
stakeholders to vetted reports and budget
entry templates

APhA Case Study
Joseph Janela
Nils Rasmussen

• Individual Membership Organization
• Founded in 1852
• 62,000 Pharmacists (chain; independents; academia;
students)
• Meetings, publishing, training programs, certification,
government grants (HHS)
• $36 million budget
• 122 staff (38 budget managers)

• Strategic Plan
• Annual Budget Process
• Monitoring the Budget

What We Have:
• Strategic Directions Committee
• Written plan with mission, goals, objectives, tactics & KPM’s
• Management teams involved in the process
• Annual review to determine the top mission and top support goals
What We Struggle With:
• Linking the plan to the budget
• Measuring & reporting on the KPM’s
Priority for the 2017 Budget Process

Expectation gap:
• Staff wanted a “one-stop” budgeting software system “to prepare their budgets”.
Timing 1 (Budget Staff):
• Budgets needed to be prepared for the mid-Sept. Finance
• Committee meeting; challenge with summer vacation schedules.
Timing 2 (Finance Dept.):
• Took time to generate, scrub, reclass, & distribute June financials
(which squeezed Timing #1)
Timing 3 (Finance Dept. & Executive Team):
• Not enough time to critically review & modify the budget

Various Methods Used to
Prepare & Communicate the Budgets:
• Calculations (Excel)
• Narratives (Word documents)
• Narratives in emails

Expectation gap:
• Education, education, education.
Timing 1:
• Expanded the time period for budget development.
Timing 2:
• Reduced the time for distributing reliable June financials.
Timing 3:
• Earlier budget cut-off & Implementation of BI360
Varying budget methods:
• Developed standardized budget templates.

Education:
• Goal: get everyone on the same page (get “buy-in”)
• Mandatory budget meetings
• Detailed walkthroughs at the budget meetings
• Hand-outs with screen shots & arrows for every step
• Detailed chart of accounts with explanations and examples

Timing 2 – Reduced the Time to Produce Timely & Reliable
Financials:
• Revenue Side
Obtained an in-depth understanding of all revenue entry points and
established procedures to acquire that info asap at month-end.
• Expense Side
Developed a standard A/P invoice form for easier data entry
Established Strict cut-off dates for A/P, accrual & and payroll entries.
• Financial Statement Side
Developed trend analysis data to help identify unusual variances from
the budget.

Timing 1 - Expanded the Time for Budget Development:
• With more timely & reliable June financial statements we were able
to open & close the budget process earlier with more time in
between (this was the big stress reliever)

Timing 3 – More Time to Review & Modify the Budget:
• BI360
Expedited the review process for me & the Finance dept.
o Budgets were locked down when “submitted”
o Able to review individual budgets as they were submitted
o Developed financial reports in BI360 that combined related
program budgets, which allowed me to review from an “activities”
perspective vs. a “department reporting” level
(i.e. the true financial picture of an activity)

Timing 3 – More Time to Review & Modify the Budget:
• Standardized Budget Templates
o Calculation templates (revenue & some expenses)
o Template for major expenses
($5,000 +) with basis for determining the budget amount
o Template for major variances
(+/- $10,000 AND >10%) with explanations for the changes

o Staff using their own data for status reports to their senior manager.
o Financials published late (reactive vs. proactive).
o “Christmas surprise” (year-end results significantly higher than the
projections developed in Sept & Oct).

o Finance took a more active role (numbers released to senior
management, Finance Committee, & Board would come through
Finance).
o Developed historical trend analysis for revenue & expenses.
o Published financials on a more timely basis.
o Budget monitoring approach:
Jan - April: concentrate on revenue (using trend analysis info)
May - June: review of expenses (compared to budget)
July - August: formal projections prepared by budget managers
Sept – Dec: monitor projections for major variances

Nils Rasmussen
APhA Case Study
Joseph Janela

Nils Rasmussen
- 27 years in the Business Intelligence industry
- CEO and Founder of Solver
- Author and speaker on BI subjects
Solver
- Founded in 1996
- 110 Employees and 220 reselling partners
- HQ in Los Angeles, 9 International Locations
- On Gartner CPM Magic Quadrant for 3rd year in the row in May, 2016
- 1,500 customers

Overall Vision
• Tying technology back to the Better Budgeting
Approach™
How Solver supports each
phase of the budget lifecycle (demo):
• Strategy
• Budget
• Operations

Nils Rasmussen
APhA Case Study
Joseph Janela

Budget
Operate
Strategize
Align Your Strategies
and Budget
1. Keep your eye on the goal
2. Get the right people
involved
3. Meet in the middle
4. Align your
technology to support
your strategy
Build Your
Operational Budget
5. Choose the right tool for the job
6. Standardize & fortify the templates
7. Monitor workflow and approvals
8. Lock down your budget
Live with and
Love Your Budget
9. Implement an
“early warning” system
10. Roll your forecast forward
11. Start planning early
12. Build one source of the truth

Contact BroadPoint for more information on available budgeting
solutions that may fit your needs or to schedule a demo of the
Solver BI360 System.
John Herbstritt Cathy Fregelette
jherbstritt@broadpoint.net cfregelette@broadpoint.net
(301) 634-2406 (301) 634-2414
info@broadpoint.net
(301) 634-2456

12 Ways to Budget Better

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