Budget season: when the CFO stops being popular

A CFO's role isn't one of the most popular within a company. But it hits its lowest popularity point when the first budget meetings come around.

The ritual always starts the same way

It usually starts with the commercial team. They always come in tentatively: a client cut investment, there aren't enough resources to grow, we need more equipment, more technology, more travel to open new markets, more raises and promotions to motivate people, more marketing, more advertising. The finance team takes notes and runs the first projections.

Marketing, IT, Procurement and HR follow. The first cost drafts emerge. The outcome of the first budget round is invariably the same: declining revenue, rising costs, compressed margin and a capex that explodes.

And the round starts again. The finance team demands more revenue from the commercial team because costs are spiralling. Tension rises. Then come the support teams, who are asked to cut costs. By this point, the finance team is eating lunch alone. But it's precisely in that exercise of creativity and alternative solutions that the budget takes shape — and there's nothing a few cakes on the table can't help.

"The budget is not an accounting exercise. It's an exercise in priorities, creativity and collective commitment."

When constraint forces creativity

I remember a specific situation at a company I worked at. To support the projected growth, the IT team needed new servers. A small fortune. I pushed hard for an alternative because the budget simply couldn't take that investment.

The idea of renting space in a datacenter was put on the table tentatively. It was the start of what we now call infrastructure outsourcing. There was scepticism about the service's reliability, but after meetings with suppliers, confidence grew. We were left with higher operating expenses, true, but capex dropped significantly. And shareholders, who were very sensitive to dividends, could see a more balanced picture. The commercial team contributed a bit more, some projects from support areas were postponed. And we reached a budget.

The true value of the budgeting process

What stayed with me from that experience wasn't only the technical solution we found. It was what the process itself produced: real collaboration between departments, involvement from all sides, and, as a result, genuine commitment to the final budget.

A budget built with healthy tension between teams is far more robust than an imposed budget. The people who took part in the tough trade-offs are the same ones who, mid-year, will fight to meet it.

A budget that works for you

At YourFinePartner, we accompany the budgeting process closely: from defining strategic assumptions to internal negotiation between areas, to building the financial model and tracking execution throughout the year.

Because a good budget isn't the one everyone loves. It's the one everyone meets.