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Establishing 'Making it Happen' as a 'Formal & Predictable' Discipline
   Budgeting and Allocation Alignment Investment Decisioning  

ENCYCLOPEDIA→   Execution Making-it-Happen  →   -  Focus & Money-Machine  →   -  Financial Focus and Alignment  → 

Absolute and Relative Budgeting

To ensure that your budgeting and allocation is aligned & focus on the strategic priorities and on your money-making machine, one should adopt a mix of two methods. One is to allocate the money as per the needs of core priorities, and then distribute the rest of the monies to the non-core areas. This is the absolute approach. After you have done this, the next stage is to normalize your budgeting. You can look at the %age distribution of investments across your mission-critical, important and desirable agenda and see if the distribution makes sense. The other aspect of the relative investment is the time-span of the investments. If the investments related to your core priorities are skewed towards the later part of the year, there might be something wrong.


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