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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
January 2010
Advanced notice
In the latest league table of Return on Equity (ROE) among the Nordic Banks, Handelsbanken came top with Norwegian bank Sparebank 1 in second place and Nordea in third place. Handelsbanken moved to a beyond budgeting-type management model over 30 years ago and SpareBank 1 has recently started on its Beyond Budgeting journey (see http://www.bbrt.org/resources/bbrt-pubs.html). Even in these difficult times the Beyond Budgeting organizations have suffered less as they are more adaptable and flexible.
Both SpareBank 1 and Handelsbanken are members of the BBRT and Handelsbanken is one of the BBRT cases.
BBRT welcomes the following new members:
The Beyond Budgeting Round Table of North America is excited to announce that noted writer Eric Krell will join the organization as Chief Content Officer. Krell will be responsible for helping BBRT expand its case-based research into how leading edge companies are moving to continuous planning and adaptive control and eliminating their traditional budgeting practices. As a leading edge authority on enterprise risk management Eric joins the BBRT roster of thought leaders that are transforming the value derived from finance operations. Krell will expand our reach and help accelerate our members’ improvement plans. He begins his new role effective immediately.
BBRT European Members’ Meeting
The recent BBRT European Members’ Meeting was held in London on 6 November. It was a very busy and interesting meeting, the highlight being a presentation and discussion with Prof. Julian Birkinshaw from the London Business School on Reinventing Management. Julian is a close collaborator with Gary Hamel in the Management Lab (MLab). Steve Player, BBRT Director North America discussed a new book, “Future Ready”, co-authored with Steve Morlidge on how to master business forecasting. Morten Esberg from Coloplast updated us on his organization's journey towards Beyond Budgeting. Dr. Michael Sonntag presented some very interesting ideas and practical examples on how to create the conditions for change and growth. Helge Eikeland from Statoil presented how the so-called “Scrum” method can help to build business agility through empowered teams. All of these presentations and the subsequent detailed discussions increased our understanding in implementing the Beyond Budgeting management model
BBRT Healthcare Interest Group
The BBRT Healthcare Interest Group meeting was held in Clearwater, Florida on 17-19 November. We were pleased to have presentations from thought leaders such as Lisa David of eCapital Advisors, Alejandro Ferreria of Baker Tilly, and Paul Fogel of Executive Informations Systems, Inc. Janice Polo, CFO of BayCare Health Systems, was also there to update and share the success of BayCare’s implementation of rolling forecasts, and Briant Keen, also of BayCare Health Systems, shared finance’s role in electronic health records implementation. Jack Alexander, CEO of Jack Alexander & Associates LLC and author of Performance Dashboards and Analysis for Value Creation, led the post conference workshop that explored best practices to create alignment, assess performance and identify and capture high leverage improvement opportunities. He will be conducting a similar workshop at the BBRTNA Annual Conference in Dallas, Texas on April 21-23, 2010.
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 papers have been circulated to BBRT members since the last Newsletter:
Why you should use benchmarking to challenge and stretch rather than judge and blame
Abstract: Benchmarking is a popular tool to drive process improvement by showing managers that they can do better. While learning from others makes sense, managers need to be careful that what they are learning can be applied in their own cultural setting and that they are comparing like-with-like. This paper looks at some of the positives and negatives of benchmarking and advises managers to be wary about adopting this approach with too much enthusiasm.
Why organizations need to find and keep the right people
Abstract: Decentralized and innovative organizations don’t just need to find and keep talented people their futures depend on them. That’s why these organizations reckon this needs to be a core competence. How they sell the benefits of working in a stimulating environment is a key element of s successful employee value proposition. This paper looks at these issues and how some organizations design and manage this process.
Why rewards should be based on teams rather than individuals
Abstract: Self-managed teams are not worthy of the name unless that all share the pain and gain of collective performance. Conversely, if recognition and rewards remain focused on individual performance then teams will never bond together. This paper examines the arguments for moving to a team-based rewards system and how some organizations have made this a key part of their decentralized management models.
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, or Heather Bryce at heather@theplayergroup.com
Recently we have discovered a paper published by Booz Allen & Hamilton in 2000 entitled “Beyond Command-and-Control: Managing the Diverse Corporation in Today’s Turbulent Times”*. Although nine years old the ideas and conclusions resonate even more today that they did in 2000. The management model that they advocate for today’s turbulent times is very similar to the Beyond Budgeting management model.
In summary the authors believe that in today’s business environment, the traditional command-and-control model of senior management can take a toll on corporate competitiveness. For most organizations this structure is no longer in step with the market dynamics of today’s global economy. They believe that what corporations need today are organizations that act like living organisms, able to rapidly adapt to the changing environment and quickly identify opportunities that can be capitalized upon, yet sufficiently aligned to ensure the cohesion of the entity.
They suggest that migrating to an empowered business model where people work as teams is not new. Leading management thinkers have been promoting these concepts for many years. So why do most companies still have a business structured modeled by Frederick Winslow Taylor over 100 years ago? The authors believe that much of it has to do with CEOs recognizing the sizeable change in behavior, processes and information required by the transformation; not seeing a clear path to achieve the transition; and fearing failure. Unfortunately, this has led to underperformance in the near to intermediate term.
These are very similar conclusions to those reached by the BBRT. This paper provides much support and evidence for the adoption of the Beyond Budgeting Adapt and Endure management model. BBRT members can access the online BBRT Implementation Guide, which contains considerable detail on how to manage the transformation.
* The full paper by Booz Allen & Hamilton may be downloaded at: http://www.boozallen.com/media/file/80674.pdf [accessed on 24 March 2009]
Several members of the BBRT network have established online networking groups, the latest being
These groups enable anyone with an interest in Beyond Budgeting and BBRT to exchange and discuss ideas and experiences.
In addition the BBRT Members have their own private online group called BBRT Members' Community that contains all the past deliverables, meeting notes and presentations and a comprehensive online BBRT Beyond Budgeting Implementation Guide.
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 Heather Bryce or call +1 214 239 0155
BBRT, 1st Floor 745 Ampress Lane, Lymington, Hampshire SO41 8LW, UK
Tel: +44 1590 679803 Fax: +44 871 266 4125 Email: info@bbrt.org
BBRT, 5501 LBJ Freeway, Suite 105, Dallas, TX 75240, USA Tel: +1 214 239 0155
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