Budget the Drivers, Not the Ledger
Identify the small set of business drivers that should anchor a driver-based budget.
The fastest way to improve a budget is to move one layer up, from accounts to causes. What to model first In FP&A, a driver is an operating factor that causes a financial outcome. Revenue might be driven by units, price, conversion, or retention. Cost might be driven by customers served, tickets handled, shipments moved, or heads hired. A line item is still necessary for reporting, but it is usually the last thing you should model, not the first. Why finance teams get stuck Traditional budgeting often starts with historical spend by account. That approach is easy to distribute but…
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