Law Department Management Blog
I have written extensively about budgets for legal departments, both internal and for matters handled by external counsel (See my post of Sept. 9, 2008: internal budgets with 27 references; and Sept. 12, 2008: internal budgets with 25 references.).
Thus, when an article in the McKinsey Quarterly, 2009, No. 3 at 115, discussed four measures to make the budgeting process more effective, it made sense to pass them along and track down earlier posts here that referred to its ideas.
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Scenario planning (See my post of July 9, 2009: scenarios instead of single figures, and decision trees; Nov. 8, 2007: ask for scenarios on budgets; Dec. 9, 2005: scenario thinking.). The article explains the importance of deciding on “trigger events” that would cause a shift from the primary scenario to an alternative.
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Zero-based budgeting (See my post of July 6, 2007: an example of zero-based budgeting; Jan. 2, 2009: pros and cons of zero-based budgeting; and March 29, 2009: a step toward reality.). Disaggregating budgets into logical groups of expenditures is part of this technique.
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Rolling forecasts (See my post of Jan. 13, 2008: rolling budgets.). Given the duration of some lawsuits, 18-month or 24 month budgets might make sense and lessens the distortion of a focus on an artificial, rigid 12-month period.
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Quarterly budgeting (See my post of Jan. 21, 2009: JDS Uniphase and its rolling, quarterly budgets; and March 29, 2009: one technique to boost budget reality.). As the article puts it, albeit in the context of an entire corporation, “abandon annual budgeting and switch to a more tactical quarter-by-quarter process” when times are tumultuous.