Inflexible budgets can lead to several negative consequences. They can cause stress and pressure on the person responsible for maintaining budget accuracy, especially if crucial forecasts cannot be adjusted. This can also lead to a lack of adaptability and responsiveness to changes in the business environment. Inflexible budgets can also hinder strategic success, as they may not allow for the reallocation of resources based on changing strategic priorities. Furthermore, they can limit innovation and risk-taking, as they often discourage deviations from the planned budget.
Simplify the process of budget creation with our Budgeting Model template. This template includes ex...
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