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27 May 2009

Thank you for your interest in BBRT. Welcome to the BBRT global newsletter, which is designed to keep you informed of developments in Beyond Budgeting and the BBRT. For further information visit our global web site at www.bbrt.org.

Table of contents

• BBRT Upcoming Events
  • 29 April 2009: BBRT European Members’ Meeting, London, England
• BBRT Member News
• BBRT Meeting Updates
• BBRT Research News

At the recent BBRT North America Beyond Budgeting Conference, Jeremy Hope, co-founder and BBRT director was awarded the prestigious Horngren Visionary Award. This award was presented to Jeremy in San Francisco by Prof. Charles T. Horngren, Emeritus Professor at the Stanford University Graduate Business School and the noted author of many accounting books. This award was made to Jeremy in recognition of his great achievements in helping to develop Beyond Budgeting from the germ of an idea to the movement it is today. It recognises his authorship of many of the BBRT research papers and case studies, plus two books: “Beyond Budgeting” (co-authored with Robin Fraser) and “Reinventing the CFO”.

In Jeremy’s acceptance speech he noted that, “it is an honour to receive this award and a thrill to see the Beyond Budgeting movement grow year by year. My thanks go to everyone involved in its continued development.”

6 October 2009 : BBRT European Members' Meeting

BBRT welcomes the following new members:

• Dr. med. Michael Sonntag
• Applied Analytix

BBRT Members’ Meeting, 29 April, London – The focal point of the meeting was the launch of BBRT’s new interactive, online Guide to Implementing Beyond Budgeting. Peter Bunce gave a live demonstration of the online Guide, which led on to a discussion on how the Guide might be improved and further insights into the Beyond Budgeting implementation process.

Robin Fraser and Lennart Francke (former Handelsbanken CFO) gave a fascinating account of how Handlesbanken originally transformed its management model and how this has evolved over nearly 40 years. This included some new revelations about how things actually work in Handelsbanken. Sigurd Aune, CFO of Sparebank 1 Gruppen in Norway described their “Going Dynamic” project, which started 8 months ago. Sparebank 1 have made there presentation available to the public - see below:

Finance Transformation Blog

Steve Player (BBRT Director North America) is now authoring a Finance Transformation blog for Business Finance Magazine. You can connect to this blog at www.bigfatfinanceblog.com

BBRT INSIGHTS research series

The following paper has been circulated to BBRT members since the last Newsletter:

How to identify and eliminate “hidden” costs that add no value

Abstract: If one of the best managed companies in the world (GE) reckons that around 40 percent of its costs add little value, what hope is there for the rest of us? Costs are not incurred in a vacuum. They are caused by the way that work is organized. The trouble is that very little of the work that we do is directly connected with satisfying customer needs or delivering customer orders. This is both a problem and an opportunity. This paper looks at the scale of the problem and provides some guidelines as to what managers can do about it.

Why measuring flow and variation is the key to process innovation

Abstract: Statistical process control (SPC) was first used in the 1920s to improve process performance in production plants. But the knowledge gained since then has failed to be passed on to people outside the production operation (and not that many within it!). The theory of variation inherent within SPC techniques tells us a great deal about how to improve process performance right across the organization. This paper looks at the lessons to be learned and how managers can apply them throughout the firm.

Why you should be sceptical about the value of Six Sigma

Abstract: Six Sigma is the latest (and to many the greatest) business improvement program around today. GE and the consulting industry swear by it. While the theory of Six Sigma is grounded in statistical process control (and that’s been around for 80 years!) its practical implementation causes real problems. An excessive focus on highly trained and expensive internal or external consultants (sometimes known as ‘black belts’) and a toolkit of techniques are a few examples. This paper looks at the pros and cons of Six Sigma and suggests that firms should approach it with some scepticism.

BBRT members can download the full papers from the BBRT Members' Community (formerly Private Forum) at www.bbrt.org/online. Join the BBRT to obtain this and previous papers – contact Peter Bunce at peterbunce@bbrt.org.

BBRT is an independent international shared learning network for all organizations that seek to improve their performance management through sharing information, past successes and implementation experiences. Our purpose is to help organizations introduce a new management model for the innovation age.

For more information, please visit www.bbrt.org, email Peter Bunce, or call +44 1590 679803, email Kisty Fairchild or call +1 214 239 0155