On 6th February, Happy and the Beyond Budgeting Institute co-hosted the 2017 Beyond Budgeting Conference.
Held at Happy’s training centre in Aldgate, the day was filled with lots of discussion around new ideas and new ways of managing organisations. We welcomed guests from across the UK and abroad, including Norway, Germany, Sweden, Portugal, Iceland and New Jersey, USA.
Anders Olesen, Director at Beyond Budgeting Institute
Anders welcomed the attendees to the conference and gave an introduction of the Beyond Budgeting concept. “Beyond Budgeting is about so much more than just budgets,” explained Anders, “but it’s a great place to start for management change and innovation.”
“When people talk about innovation, they think about technology. When we start to talk about management innovation, suddenly they get a bit less excited.” However, technological innovation is a very busy and crowded market – and “to really get ahead, you need to look at management.”
While some organisations need rules and regulations (for example, organisations in the financial sector), they can still work in a more dynamic and organic way, without the hierarchy and tight restrictions.
When managing budgets, planning a year ahead makes sense – but for most, this doesn’t work, and causes unnecessary waste.
You can download Anders’s PowerPoint presentation here.
Henry Stewart, CEO of Happy and author of the Happy Manifesto
A key message from Henry’s talk was the importance of delegation and job ownership in organisations.
“We are natural barriers to change – if it comes across our desk, we have to do something with it, don’t we? But if you truly delegate, you don’t get what you would do – you get what they would do.”
Allow your staff to set their own targets – they will often set far stricter targets for themselves than their managers would do, and they are much more invested in their success.
You can download Henry’s PowerPoint presentation here.
Mira Gvozdenovic, formerly of Coloplast
Mira then gave a real-life case study from her previous company, Coloplast, who implemented Beyond Budgeting – and significantly improved their performance.
Coloplast is a healthcare company and offers solutions within ostomy care, wound care, and continence and urology care. “I was very proud to be part of the Coloplast team, because I felt that we really made the difference by improving life quality for people with intimate healthcare needs.”
Mira explained that the company transformed from being a traditional regional player to a global leader within the industry. The new leadership style combined with Beyond Budgeting principles enabled Coloplast to reach its full potential.
Mira’s main advice for anyone wanting to implement Beyond Budgeting at their organisation was:
- Design 80% and jump.
- Ensure the leadership support in implementation – take the time to explain what’s happening and involve them.
- Get help from HR to link the performance with leadership.
- Work with mindset change and arrange training sessions for both leadership and finance teams.
- Empower your staff to make the right decisions.
- Removing detailed planning and giving Coloplast’s team more authority and control on their spending resulted in up to 15% cost reductions.
Mira explained that Coloplast implemented Beyond Budgeting as a new performance model, which enabled Coloplast to become more agile and adaptive. It was a process of simplification, setting a clear direction and focusing on what matters.
You can download Mira’s PowerPoint presentation here.
Paul Gapper, Senior Facilitator at Happy
Paul gave a short, ten-minute talk about mindfulness and allowed everyone to try a short two-minute mindfulness exercise.
His number one tip for anyone wanting to try mindfulness is to remember that “mindfulness is about just noticing.” Admit to yourself when you feel stressed, sad, or frustrated – don’t try to repress your feelings. Notice when your mind wanders – don’t try to stop it (it happens to everyone!).
Henry has talked about Next Jump and how they have created a great place to work in a previous blog – and we were delighted to welcome Chris and Kevin to speak at Beyond Budgeting.
Their main points from the conference were:
- Staff spend half of their time worrying about ‘office politics’ – covering up their weaknesses, managing people’s impressions of them, and making sure that they show themselves at their best. What if you got rid of this second job? How much more energy would your staff have to focus on their actual jobs? What if you removed this fear of failure?
- They have implemented a co-mentorship programme across their organisation, called Talking Partners. This mutual coaching scheme allows staff to talk about their issues and vent to a colleague, and encourage each other to work at their best.
- Personal character is a muscle – it can be exercised and strengthened. For example, someone can learn to be more patient. (An idea inspired by Dr Jim Loehr, of the Human Performance Institute.)
You can download Chris and Kevin’s PowerPoint presentation here.
Bjarte Bogsnes, VP Performance Management Development at Statoil and Chairman, Beyond Budgeting Institute
Next, we heard from Bjarte about how Beyond Budgeting works at Statoil. Statoil is a relatively new company, starting in 1970 when oil was found in Norway. It had to grow very quickly to compete with other oil companies, and a lot of responsibility was given to young people from the start.
- At Statoil, performance bonuses are based on delivery and behaviour, not just financial results – “the way we deliver is as important as what we deliver.”
- Instead of targets, staff have “ambition to actions.” The management board create ‘strategic objectives’ for the overall organisation and work out KPIs to measure progress, and create actions and forecasts with clear deadlines and accountabilities. Team goals are then created from these, and then drill down to the individual’s own goals and their contribution to these.
- Financial targets are set as ‘evergreen’ targets – they always aim to be in the top third of the competition on their 12-month figures, rather than a set figure.
- The Beyond Budgeting method is like using traffic lights vs roundabouts. Traffic lights are easier to follow, but roundabouts are smoother and traffic flows quicker. Roundabouts give drivers the freedom to make their own decisions and are trusted to decide when is best to leave. They enable great performance, rather than controlling it – they are self-regulating and self-rewarding.
You can download Bjarte’s PowerPoint presentation here.
John Seddon, Vanguard Consulting
The last talk of the day was presented by John Seddon, author and Managing Director of Vanguard Consulting. His entertaining and informative talk gave practical ways that companies can lower costs – without cutting the quality of the service. Often staff and organisation processes are blamed when demand and budget costs rise, when this is not always the issue – demand avoidance is a really important factor.
- Analyse and understand your current customer demand, and then give staff better training and tools to solve these common issues – as well as the training to understand when they have an issue that they can’t manage, and how to deal with this.
- A manager’s focus should be “how do I help my staff to solve more problems?” – they should help their staff to solve problems, and give them the knowledge and the technology to do their job more effectively.
- There is some culture change in this – organisations need to be more flexible to respond to customer demand – and learn to work in a more Agile way, to test, learn and adapt quickly.
John did not use PowerPoint slides.
Thank you again to everyone who joined us and made the day such a big success.
We will shortly have video footage from the day, with all of the key points from each of the talks, which we will make available in the next few weeks.