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From ZBB to ZBx

How a zero-based mentality enables companies to zero in on agility and growth.

By Kris Timmermans | Updated on October 25, 2017
Fewer than one in five CFOs feel that their company is properly organized to optimize its cash flow, according to recent Accenture Strategy research. This insight comes as pressures on businesses mount. They must find ways to reduce costs, improve competitiveness, and accelerate investments in automation technologies. They also must be agile enough to respond quickly to changes in the external environment.

Organizations that want to thrive in today’s markets need to be using their funds in ways that optimally support their business strategy, and they need to be prioritizing investments in strategic initiatives. The fact that many still don’t feel prepared to do so illustrates that now, more than ever, companies need to rethink their approach to corporate budgeting, spend, and cost reduction.

Enter ZBx, or the zero-based mindset, a new, more comprehensive take on zero-based budgeting (ZBB). ZBB refers to the practice of building an annual budget from the ground up, rather than basing it on the prior year’s financials. Many associate ZBB with corporate shakeups that entail mass layoffs or restructuring. However, ZBx is not about seeing fragile companies through times of disruption and change.

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