Beyond Budgeting: How Managers Can Break Free from the Annual Performance Trap [ILLUSTRATED] (Hardcover)

by Jeremy Hope (Author), Robin Fraser (Author) "Like them or loathe them, everyone has a view about budgets..." (more)
Key Phrases: fixed performance contract, relative improvement contract, abandoning budgeting, Leyland Trucks, Balanced Scorecard, Groupe Bull (more...)

Editorial Reviews

Review
"Beyond Budgeting is a must-read for anyone interested in seeing the future of performance management." -- Planning Perpectives, Issue #29, September 23, 2003

Product Description
The annual budgeting process is a trap. Pressured by fixed targets and performance incentives, managers focus on making the numbers instead of making a difference, meeting set goals instead of maximizing potential. With their compensation at stake, managers often resort to deceitful-even unethical-behavior. In the end, everybody loses-the employee, the company, and ultimately the customer.

Now, finance experts Jeremy Hope and Robin Fraser reveal the results of an intensive study aimed at fixing the broken budgeting process. They argue that companies must abandon traditional budgeting contracts in favor of a radical new model that links performance measurement to evolving competitive benchmarks-and shifts the firm's focus from controlling employee behavior to delivering customer value.

The Beyond Budgeting model is built on the best practices of companies that have successfully revised their centralized planning and budgeting processes. It combines a leadership vision that devolves more authority to operating managers and a finance vision that enables fast decision making through appropriate tools and accessible information. Through vivid examples, Hope and Fraser illustrate how companies can implement these shared visions-and the long-term benefits that accrue from embracing them.

Offering a compelling case for breaking free from the budgeting trap, this book paves the way toward making organizations better places to work for, invest in, and do business with.

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Product Details

• Hardcover: 336 pages
• Publisher: Harvard Business School Press; illustrated edition edition (April 11, 2003)
• Language: English
• ISBN-10: 1578518660
• ISBN-13: 978-1578518661
• Product Dimensions: 9.2 x 6.5 x 1 inches
• Shipping Weight: 1.2 pounds (View shipping rates and policies)
• Average Customer Review: 4.7 out of 5 stars See all reviews (6 customer reviews)
• Amazon.com Sales Rank: #199,843 in Books (See Bestsellers in Books)

Customer Reviews

Most Helpful Customer Reviews

8 of 8 people found the following review helpful:

4.0 out of 5 stars Excelent real life cases, July 1, 2004

By	Johan Løvlie (Norway) - See all my reviews

This book does capture the findings from the work of Beyond Budgeting Roundtable in a excellent way. The cases in the book are real and are brilliant proofs of the fact that it is possible to run even a large corporation with out traditional budget models. I'm really looking forward to the follow up.

11 of 13 people found the following review helpful:

4.0 out of 5 stars Good Book on Relatively New Topic, December 29, 2003

By	"moshe_gfkl" (Ra'anana, Israel) - See all my reviews

As a business consultant with many years experience in budgeting, I found this a very useful overview of a relatively new topic in finance. The authors clearly show the limitations of the traditional budgeting process and present a comprehensive alternative.
However, while the book brings many examples from real companies, many of the ideas still seem a little conceptual and difficult to imagine how they would actually work in practise.

This book will certainly interest anyone seriously involved in budgeting.

1 of 1 people found the following review helpful:

5.0 out of 5 stars Accepted ideas are no longer competent and competent ideas are not yet acceptable, January 11, 2009

By	Stephen Parry "Author of Sense and Respond" (Lean Service Transformation Designer London) - See all my reviews (REAL NAME)

This book and its associated Harvard Business Review articles (by Hope and Fraser) from 2003 has not attracted the attention it deserves.

When this was written it was seen as the antidote to the endless budgeting cycle based on the 'prediction' fallacy and the ensuing corporate gaming they create.

All of us have said at one time or another this process (budgeting negotiation etc.) is a joke, but we all continue to play our part in maintaining the joke, playing the game, fighting for survival in a world created by the madness of the corporate budgeting processes.

Hope and Fraser have clearly demonstrated that the current process is not only wasteful in terms of human effort but downright detrimental the the enterprise, employees and customers. They go further and show us all a way out of the trap.

There is an alternative, but it needs study and it needs more companies other than the ones illustrated in the book to lead the way. Only then can we change the current paradigm where 'Accepted ideas are no longer competent and competent ideas are not yet acceptable'