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RAPPORT

Getting head by cutting back

Using zero-based budgeting to fuel growth

Digital has challenged the way business is run down to its core. Markets are characterized by rapid change—where new rivals enter seemingly from nowhere, offering paradigm-shifting products and services. It’s anything but “business as usual.”

But most companies today base their cost management approaches on exactly that—setting budgets based on what happened last year. Against a backdrop of increasing volatility, it’s time to reimagine cost structures based on what’s needed in this new, disruptive environment. Using zero-based budgeting (ZBB), basing resource demand on the now instead of last year’s performance, frees up capital which can then be used on activities that ultimately boost growth.

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