Is it possible to increase your organisational budget during a slump or general spending freeze?

One hypothetical way is to present a case for improvement, where the most uncertain elements of the innovation case are inflated above worst-case expectations (raising the aftermath question, did we really have to spend quite so much to not deliver an innovation result?).

If up front, no one knows more about the accuracy of the uncertain elements in the case than the case presenter, then an inflated budget approval is the likely outcome. The inflated element once approved, can be spend in the later stages of the case by the case manager. For example on various ‘gold-plated’ tools and more overseas visits rather than with ‘ silver-plated’ tools and fewer visits (which would have adequately delivered the case), to be explained away as a necessary part of the process.

The approving body will naturally look at the past track record for the dept concerned (Did they deliver last time? Did they spend what they asked for last time? Is the last time anything like the current case?), its overall affordability envelope and the strategic attractiveness (to the organisation) of the latest case. Three ticks likely gives a green light.

It means in practice that true innovation will cover its needs and then some. Of course, being on the leading edge, none of the budget approvers will yet know an inflated judgement from a less-inflated judgement, particularly in highly technical areas. And of course, if the innovation case delivers below the inflated budget, the presenters are  congratulated and more likely to have their (inflated) bid granted next time too!

Is this fair and is this right? For those managing the status quo and who receive a correspondingly smaller share of the pie, the answer is a loud no. For the shareholders, lenders, venture capital providers, customers of the resulting innovation and other stakeholders, they probably rationalise it as a legitimate cost of innovation (additional reward to the innovator for risk-taking on the leading edge) with some perhaps also seeing it as an incentive for more parties to jump on the innovation ‘band wagon’, for those in the know.

However, multiple it up across whole sectors, nations and international trading blocks and that’s a large ongoing wasteful spend element, permanently out of reach of even senior level cost-cutters. The price of progress.

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