Symptom: The allocation of budgets across client departments is not aligned with business strategy.
The clients with the best strategic opportunities are those closest to the strategic business initiatives of the company. These select people should receive a disproportionate share of a staff organization's attentions.
Sometimes, the most strategic clients don't have the most spending power. This may be because the staff function is centrally budgeted (rather than fee for service). If staff departments receive the budget for their products and services directly, then their budget must subsequently be allocated to clients (as well as to the organization itself for internal projects). In this "centrally planned" internal economy, the process of allocation of discretionary spending power must be carefully examined.
Strategic alignment will suffer if the organization doesn't allocate control over its discretionary resources to clients properly (or at all). Or perhaps allocations are done well, but are not adjusted dynamically throughout the year as strategies change.
(In fee-for-service organizations, the clients' spending power is the result of companywide budgeting processes, and beyond the scope of any one staff organization.)
Root cause:Internal economy, budgeting copyright 2024 N. Dean Meyer and Associates Inc. All rights reserved.
