Foreword ix

Acknowledgments xv

Introduction 1

1 Initial Reflections 11

2 The Problem 19

3 Beyond Budgeting 27

4 Separate and Improve 41

5 Beyond Budgeting for Whom? 77

6 Agile Transformation 91

7 Handelsbanken 103

8 Implementation 123

9 What’s in It for the Bottom Line? 137

10 What’s in It for Me? 143

Epilogue 147

Index 149

Praise for This Is Beyond Budgeting

“The budgeting process and mindset is behind so many soul-destroying evils in organizations it is astonishing that it has been so persistent. There is a better way. Bjarte Bogsnes’ new book is the antidote you have been looking for. It isn’t undisciplined, expensive, or hard, and it can unlock a whole new vector of effective management for you. He has proven Beyond Budgeting works with organizations big and small over many years. I’m a big believer – read this book and you will be too!”
— Rita McGrath, Professor. Columbia Business School

“Bjarte is one of those rare individuals who has lived the life of an executive in a large corporate, realised its limitations, and made radical changes stick. He has done so with an open mind and open heart, creating methods and tools of critical importance to our increasingly uncertain and complex world.”
—Dave Snowden, Founder The Cynefin Centre

“I have met thousands of business executives over the years, and none of them has a good word to say about budgeting—it is slow, burdensome, and short-sighted. This book provides the antidote—Beyond Budgeting—by one of the pioneers of the concept and perhaps its most experienced practitioner. Don’t just read the book—make sure to put this into practice in your own company.”
— Julian Birkinshaw, Professor of Strategy and Entrepreneurship, London Business School

“Bjarte Bogsnes has been a fixture as a speaker at management conferences for many years now, passionately making the case for more adaptive and human organizations, better fitted to the demands of our turbulent world, and the aspirations of today's employees. If you have not had the pleasure of listening to him, this book is the next best thing—a distillation of his thoughts and insights into this incredibly important topic.”
—Jos de Blok, CEO and founder, Buurtzorg

The pressure on executive teams is immense. They keep being challenged by stakeholders about the need for change and radical transformation, and not just on becoming greener and more sustainable. The pressure is also about becoming more dynamic and adaptive and less bureaucratic. There is a jungle of models and thousands of books claiming to have the answer. No wonder many feel overwhelmed and confused.

In This is Beyond Budgeting: A Guide to More Adaptive and Human Organizations, award-winning author Bjarte Bogsnes describes a tested and proven way of making organizations more adaptive and human. This involves radically changing traditional management, including the budgeting process, the central nervous system of rigid and bureaucratic organizations. In this book, you’ll learn to establish a highly decentralized and dynamic management model with more adaptive and self-regulating processes, designed in line with and not against human nature.

The author explains what the Beyond Budgeting model entails and illustrates its use with real-world case studies of companies that have implemented it to great effect. He discusses the most common challenges encountered during the implementation of Beyond Budgeting, including the challenge of changing not just what we do, but also how we think. This includes discarding the two main assumptions behind traditional management; that the future is predictable and plannable, and that people can’t be trusted.

This is Beyond Budgeting demonstrates how to take the principles of agile and scale them up to enterprise level, through a comprehensive model that offers a coherent combination of leadership principles and management processes. The book also describes the many benefits that companies can realize by exploring and embracing management innovation as boldly as technology innovation.

This book will earn a place in the libraries of managers, executives, board members, and other leaders seeking a better way to lead and manage in new and different realities, with increasing complexity and volatility, and where employees have new and different expectations, way beyond just a paycheck.