Zero-based budgeting (ZBB) is a method of budgeting in which all expenses must be justified for each new period. The process of zero-based budgeting starts from a “zero base,” and every function within an organization is analyzed for its needs and costs.
How often have you seen the unfettered expansion of a budget possessing ten main cost centers and several more secondary spending centers? How often have you seen managers disregard it and increase their department’s spending?
The manager who determines his next year’s budget in this manner inflicts a gross injustice on other departments and the company who provides funds.
Douglas County Needs Budget Hawks
In business, the company would be its investors, who provide money to operate a profitable enterprise. In the home, the beneficiary of a balanced budget is the family itself; and, in government, it is the tax-paying citizens who elected representatives to be good stewards of their funds.
In both business and government, the accepted method is to take the previous year’s budget and factor-in additional sums to accommodate for inflation and the manager’s additional requirements.
A good steward of funds examines his department needs like a hawk and determines whether his budget aligns with the company’s strategic mission.
Granted, a department’s mission is legitimately expanded, which would require an increased budget. In these cases, a manager may begin with no funding. He must create a new budget. In both cases, before arriving at the bottom line, the manager must first analyze his mission and organize his area of responsibility into working groups by asking questions such as:
- What they do?
- How much work is required?
- How many people will be needed?
- Do they need additional training?
- What is the cost of that work?
Zero-based budgeting is the only way to accurately analyze costs and determine required funding. It would be best to coordinate with appropriate managers to make zero-based budgeting a reality. In so doing, our citizens would be better served.
Elect “Walt” Nowosad for Commissioner
Please vote for me so I can assist in returning deliberative and honest processes to the Board of County Commissioners and keep our county rural, scenic, and quiet.