Delivering on our budgets

Many of us are initiating or in the midst of budget season, including our National Government. This process concludes later in the year and sets the tone for our organization’s 2026. While I won’t deny the importance of financial knowledge in my role, I believe the true strength of a corporate budget lies not just in the numbers themselves but in its ability to turn vision into reality, driven by our collective efforts and shared purpose. Developing a solid budget isn’t just a financial task; it’s a strategic roadmap created with the very individuals who will bring it to life.

The process begins long before the first spreadsheet is opened. As the former US President said, “Don’t tell me what you value, show me your budget, and I’ll tell you what you value.” It requires a deep understanding of our organization’s strategic goals, market dynamics, and our people. We need to start with a clear vision of where we want to be in the next year, five years, and beyond. This involves working closely with the CEO, executive team, and department heads to define our strategic priorities, identify key growth opportunities, and assess potential risks. It’s a conversation, not a financial exercise done in isolation. At PHINMA, we hold kickoff meetings to share strategic objectives and key inputs that will influence every department’s plans.

Next, we analyze the data: past performance, market trends, and competitor insights to develop our assumptions and forecasts. But data alone is never enough. We must go beyond the numbers and tap into our teams’ collective knowledge and expertise. Each department offers unique insights into their areas, especially regarding challenges and opportunities. We promote ownership and accountability by involving them in the budgeting process, which also helps us get a clearer picture of the actual situation. During budget season, I make an effort to meet with as many teams as possible to understand their confidence levels. We actively seek input from all levels, hold workshops, and engage in one-on-one conversations to ensure every voice is heard.

Next, we start translating our strategic goals into specific, measurable financial targets. We collaborate with each department to create realistic and achievable budgets that match our overall strategic objectives. We encourage them to be ambitious but also to stay grounded in reality. It’s a balancing act, but it’s essential for laying the groundwork for success. This often involves a lot of back and forth and depends on our ability to communicate effectively within the organization.

A well-crafted budget should be more than just a financial plan; it should be a living document that guides our decision-making throughout the year. It should be flexible enough to adapt to changing market conditions and emerging opportunities, but also disciplined enough to ensure that we stay on track to achieve our goals. Regular monitoring and reporting are crucial for keeping us informed of our progress and identifying any potential issues early on. We embed cyclicality and seasonality into our budgets and develop milestones to track progress over time.

However, the most advanced budget in the world is worthless if it’s not embraced and executed by our people. We need to communicate the budget clearly and openly, explaining the reasoning behind the targets and the implications for each department. We need to foster a culture of accountability, where everyone understands their role in reaching our financial goals and is empowered to take ownership of their responsibilities.

More than that, we need to create an environment where our people feel valued, supported, and motivated to give their best efforts. This involves investing in their growth, providing the resources they need to succeed, and recognizing and rewarding their achievements. It also means fostering a culture of collaboration, where teams work together to overcome challenges and achieve shared goals. After all, our employees are the ones who make the budget a reality. As CFO, my job is not just to manage the finances; it’s to empower our people to bring that budget to life, turning a financial plan into a shared, tangible success. That is the true measure of a successful budget.

The views expressed herein are the author’s own and do not necessarily reflect the opinion of his office as well as FINEX.

EJ Qua Hiansen is the chief financial officer of PHINMA Corp. and the president of the Financial Executives Institute of the Philippines.