What started as a budgeting technique forty years ago has today become an invaluable

leadership tool that aligns the strategic priorities of a whole organization. Companies that are

behind in zero-based budgeting (ZBB) get left behind everywhere else. In fact, it has become

non-negotiable for survival.

Take the example of a leading brewing company in India that was experiencing flailing margins.

It teamed up with Accenture to establish a ZBB program to enhance profitability. The program

delivered cost optimization of 11-12 percent on the addressable spend baseline-across the

entire P&L. More importantly, the client and Accenture collaborated to drive a company-wide

cultural change in mindset. By adapting a "control tower" approach and implementing ZBB

principles across the organization, it was able to establish a sustainable, cost-conscious ZBB

culture.

A recent Accenture survey unpacked the ZBB buzz by speaking with top companies that have

gone zero-based. The survey found that adoption of ZBB has grown exponentially by 57 percent

every year, over the last five years. In fact, more than 90 percent of companies globally have

fully met or exceeded their program targets. Most major companies are focusing on more than

US$1 billion cost savings to fund growth strategies and pivot to digital business models. It's no

wonder then that a zero-based mindset is the ideal approach for Indian businesses.

Anything "zero-based" is the rage today.

The media is flooded with stories of companies that have successfully used

zero-based methods to reduce costs and boost profitability.

FIGURE 1: GROWTH IN ZERO-BASED BUDGETING PROGRAMS

ZERO IN ON PROFITS

ACCENTURE BUSINESS JOURNAL FOR INDIA 2018

sdfgb sdcfvbn sdfgh