Page 204 - Budgeting for Managers

Mastering the Budget Process
– If it was simply a calculation error, then change the way
you make the calculation.
– If it was something that could have been predicted,
then change your method of analysis.
– If it was a piece of information you didn’t have at the 187
beginning of the year, see if you can get that informa-
tion this year.
– If it was an outside event that you just could not have
foreseen and there’s no one you could have talked to
who would have known, just let it go. These things hap-
pen: reality always gives us the unexpected.
• Don’t forget the other parts of estimation. Review your
choice of line items and see if you need to create new line
items or split or combine existing items.
If you do this each year, you’ll get better and better at esti-
mating and making a budget.

Learning from Mistakes
As you start managing or gain greater responsibility as a man-
ager, you’ll make mistakes. We all do. There are many different
views of mistakes. I think it’s more valuable to solve the prob-
lem and learn from the mistake than to blame ourselves or get
into debates about who’s responsible for the error. I suggest the
following steps:
1. Remember: the mistake is in the past. The issue is now
the current situation, not how the mistake happened.
2. If necessary, do damage control. Take care of the situation
to reduce the problematic effects of the mistake.
3. Solve the problem.
4. Take a deeper look and improve procedures so that no
problem like this will happen again.
5. Share what you learned with others, so that everyone can
improve the way they work.
Learning from our mistakes is not a one-time event. Maybe
you’ve learned to keep good, up-to-date records of your trans-