It’s Budget Season: Are You Planning for Business Transformation?

By Erin Koss, CPA is an Andersen Business Consulting Alumni (1993-1999), and CEO of Syte Consulting Group, Inc.

For most manufacturing companies, the end of summer and the arrival of fall usually marks the start of planning for the upcoming year. This is always a great opportunity to start thinking about the investments your company needs to make to stay competitive and grow — whether that’s buying new software, adding more people, or streamlining operations.

Whatever your plans, it’s natural to want to cost out some of those concrete investments and get them on the books as soon as possible. But while that may seem like the most proactive approach, it can lead to some unintended consequences.

At Syte, we know from decades of working with family-owned manufacturing companies that large-scale initiatives can’t be rushed. They require analysis and planning to pave the way for success.

In this post, I’d like to offer you some time-tested advice on budget planning for large change initiatives. Read on to learn how a focus on planning and analysis up front will save you time and money later — and set you up for long term success.

Business Transformation Is More Than a Budget Line Item

Budget planning is a good time to spark a conversation with your leadership team about where the business needs to go, and what it will take to get there.

That’s why we developed our four-part Business Transformation Framework to help our clients plan and implement the solutions they need to get to that next level. It’s a methodology we use to meet you and your business where you are, and then map out what steps you need to take (and which investments you need to make) to get to where you want to go.

And when it comes to planning your budget for some of these bigger ticket items, I think our approach offers a few important advantages.

A Gradual Approach Makes Implementation Easier

I like to think of our Business Transformation Framework as a “crawl, walk, run” approach. Before you can hit the ground running with any new solution or organizational initiative, you need to have the right foundation in place.

In practice, that means taking an honest look at where you are in terms of business processes and workflows, human capacity, and technology.

When you take the time to do a thorough business process assessment — ahead of deciding what you may or may not need to grow the business — you’re introducing more predictability into the overall plan. Once you have a handle on how your organization is currently managing its day-to-day operations and the roles and technologies that keep things going, you’ll be in a much better position to determine what you need to change, and plan accordingly.

And if you’re already in a position where you’re comfortable proceeding with solution selection and implementation, you can use your knowledge of the organization’s current operations to plan a smooth transition in a way that minimizes disruption.

The bottom line is that taking a gradual approach to change, with proper planning up front, is easier on your organization and your budget.

When You Save Time, You Save Money

Another key advantage our clients get with our Business Transformation methodology is the amount of effort — and money — it saves on the back end.

In their enthusiasm to embrace new technologies in pursuit of a growth strategy, many manufacturing organizations plunge head-first into solution selection — only to run into problems during implementation.

We can usually trace this back to an incomplete understanding of current workflows and capacities. Implementing a solution that doesn’t align with the current reality immediately creates friction: Software has to be customized on the fly to accommodate existing workflows, or team members are asked to redesign their processes to fit with new software capabilities (or limitations). Sometimes, neither approach does the trick.

Before long, the project is behind schedule, and project costs start to rise as this unplanned-for work threatens to derail the initiative.

Our Business Transformation Framework is a time-saving approach. By meeting you where you’re at and being intentional in the planning on how to move forward, we can help eliminate any back-pedaling during implementation. You’re able to see what’s coming (and what’s likely to come up) instead of having to double-back to see where you might have missed something when you hit a roadblock.

Doing your planning up front saves you time and money in the long term.

Planning Puts the Horse Before the Cart

The old adage that “If you’re failing to plan, you’re planning to fail” might sound a bit cliché, but when it comes to large-scale projects that are tied to business growth … well, the shoe fits!

Big-ticket projects represent significant investments, so planning them into your budget is obviously critical. But knowing that your organization needs to change and knowing what needs to change — including how you’ll get there — are very different things. Without a thorough assessment of where you are now (and any gaps and bottlenecks you need to address), any estimate of what you’ll need to spend to get the business to a new level of growth may just be a costly shot in the dark.

Before you allocate funds to new software or higher headcount, consider building in budget capacity to analyze your current operations and identify a solution based on your goals and current state. With solid analysis and planning in place, you’ll be able to safeguard the capital investments you’re making and know that they’re going to take your business where you want it to go.

An Investment in Planning Is an Investment in Growth

Investing in ERP solutions and business process optimization is an investment in business transformation. The good news is that you don’t have to tackle it all at once. Taking a thoughtful, methodical approach is easier on your organization and your budget.

Are you starting your operations planning for next year? If you are, don’t earmark a budget for ERP software just yet — talk to us first and we’ll help you make a plan. You can schedule your complimentary consultation right here.

Erin Koss, CPA is an Andersen Business Consulting Alumni (1993-1999), and CEO of Syte Consulting Group, Inc. She is known for helping family-owned manufacturing companies scale with vision and integrity. Taking a people-first, process and technology readiness approach, Erin and the team at Syte ensure companies are ready to take on big change initiatives like ERP before diving in headfirst. A native to the Pacific Northwest, she enjoys traveling, being outdoors, hiking, biking, rowing, and supporting local culinary scene. Talk to Erin about preparing your company for sustainable growth.