The mortality of Brazilian companies is directly related to the lack of planning and control. In a globalized and unstable economy, the Business Budget is determinant for the maintenance and development of business.
By cultural factor, most Brazilian entrepreneurs do not realize the annual budget because there is an understanding of the importance of this strategic tool, on the other hand, the companies that habitually do this planning and follow their results, are clearly ahead of their competitors.
The budget should be understood as a tool to the financial strategic planning, measurement of expectations of results, as well as being an important tool to aid decision of top management decisions.
After a macroeconomic analysis to understand the directions of the national economy, the company must outline its goals and objectives, after completing these steps, generate the quantitative information that will be the basis of the planning.
In 12 months it is natural that changes in strategies or even expectations of economic development of the country occur, and thus, it is necessary the monitoring and possible adjustments in the budget, called the Rolling Forecast. This is a follow-up followed by monthly adjustments to meet the changes imposed by the economic scenario. As this is only an adjustment, it should not be distanced from the strategy previously elaborated in the budget.
With a solid budget and well-defined strategies, the entrepreneur will be much more prepared to make decisions that can change the direction of his business.