In this time of pandemic and uncertainty, budgets are becoming more and more relevant by the minute. Most companies are trying to get their arms around unnecessary spend and reel in loose spending processes in order to keep their heads above water.
But budgets rarely elicit excitement; just think of your last budget meeting. When you sent the invite “Discuss Quarterly Budgets,” did you receive a bunch of excited replies? When the meeting came around, was everyone high-fiving and amped?
We’re guessing not—and we understand why. Budgeting is an emotionally-loaded topic, often associated with restriction or just being told “No.” Given these negative feelings towards budgets, you might be surprised to hear that we built the entire Divvy platform with budgets at the center. And if there’s one thing we’ve learned, it’s that finance leaders are passionate about budgets—for good reason.
Expense management through the years
Expense management is nothing new. In fact, Divvy’s inception was prompted by a recognition that while expense management is a necessary evil, the process doesn’t have to be.
We set out to simplify transactional spend and eliminate expense reports altogether. To us, it’s silly to allow people to spend money and then ask for approval.
Many competitors are still aligned with this model: Spend now, ask forgiveness later. Unfortunately, this creates an anxiety-ridden mess for leaders and finance teams. Plus, it’s not ideal for employees.
The traditional expense reporting and reimbursement process asks employees to carry company debt (without interest) and to wait weeks or months to be paid back. This creates a stressful culture as employees go without reimbursement and with numerous unanswered questions: How many back and forth emails can it take? Why was my expense report denied? How could I have known that was the right expense code? Why does Joe get a company card but I don’t?
The solution to this friction starts by creating a process that sets employees and leaders up for success. Starting the conversation with enforceable, flexible budgets is key to removing so many painful barriers to spend.
Budgets = Control & Flexibility
At Divvy, we believe that budgets are the perfect vehicle to set up a process of mutual understanding and intentional spending.
These are some of our budgeting mantras:
Proactively control spend
This is the whole enchilada, the big bambino, the real deal. In an ideal world, a business or financial leader could send out an edict: We never go over budget, we always forecast accurately!
But usually, the strategy of spend management looks a lot more like herding cats: You spend a lot of time trying to set budgets, only to be pushed underwater by an influx of unidentified spending, random expense reports, requests for more, and thoughtless “use it or lose it” spending at the end of every budget period.
This is the primary reason that Divvy proactively sets spending limits by budget. If you set marketing’s budget at $50,000, employees literally cannot spend over that amount without asking you. Which leads us to the second reason we love budgets.
Start a conversation
We realize that businesses need to change, be flexible, adapt. We’re not saying that budgets should be stagnant, quite the opposite rather.
What we want is for budget owners and leaders like you to have a chance to discuss changes. We allow for Divvy users to request budget increases whenever they need them. But something magical happens when a salesperson or a department manager has to hit the “request funds” button: You get a notification and get to have a conversation with the requester before they spend more money. You’re not saying no, you’re saying “Be intentional and have a business case.”
Be flexible but firm
If after you discuss the intention of the budget adjustment, you find that the request is reasonable, Divvy is flexible and lets you adjust budgets on the fly. All charts, graphs, forecasts, and spending power are updated with the click of a button.
The new limit is—as the limit before it—firm. So you don’t have to worry about employees overspending without permission.
Managing “living” budgets with Divvy
With Divvy, your budgets become more than static cells on a spreadsheet, your budgets come to life. These “living” budgets guide daily—not monthly or quarterly—decisions about how and how much your people spend, as well as your company’s long-term strategy. Much like a garden, you need to prune your budget here and pluck there for best results.
That’s why we’ve been focused on rolling out new functionality to help you manage living budgets more efficiently. Here are a few of the feature updates we’ve announced recently:
Secondary navigation in the Budgets menu
Now, when you click the Budgets icon from the main menu in Divvy, all users see a secondary navigation menu. This allows users to move in and out of budgets detail pages with ease—no matter how many budgets you’re a part of.
Physical card active budget
To help users who can spend from multiple budgets, we’ve streamlined how budgets work with your card. When you go to spend on your physical card, your default budget will always be the last budget you selected.
Send funds in bulk
We know that getting funds to your team, while maintaining control is extremely important. Budget owners and admins can now send funds to any user from both the mobile app and desktop in bulk.
Budgets owners and admins can send funds to multiple people at once, even if they aren’t currently in the budget. Users funds will automatically update and any users not already in the budget will be added automatically.
For things like a lunch budget, team event, or other project-based activities, you can now create a shared funds budget. All members in a shared budget have access to any available funds. Not only does this make spending easier for budget members, it also reduces the administrative workload on budget owners (because they don’t have to deal with requests for funds). But don’t worry your teams still will not be able to exceed the total budgeted amount.