ZBB (Zero Based Budgeting)

ZBB (Zero Based Budgeting) means, per Investopedia, is a method of budgeting in which all expenses must be justified for each new period. 

The process of zero-based budgeting starts from a "zero base," and every function within an organization is analyzed for its needs and costs. The budgets are then built around what is needed for the upcoming period, regardless of whether each budget is higher or lower than the previous one. 

I will tell you at the end as to why I am writing this subject. 

I was an EA (Executive Assistant) to my Western Region President. We had strong recommendations (from HQ) to cut our expenses, especially travel costs. In our company, anybody and everybody will book a ticket and travel to any destination without prior approval by the managers. That is why our company was known as All Talk and Travel. 

In order to cut the expenses related to travel, I suggested to my boss to issue an order that all travel itinerary should be personally approved by him (President of the Western Region). We did not give any pre-allotted budget to each department for travel. 

You know what happened. All requests for travel were approved by the President of the Western Region. Not a single request was denied. But the travel related expenses came down to 35 percent compared to previous year.  Just for the reason they have to get prior approval from the President of Western Region, most employees decided not to request for travel.

Why I am writing this! I just read the Republican Party Presidential contender Vivek Ramaswamy said that if elected he would require the executive branch to adopt zero-base budgeting. “Start from zero for every department and ask what (if any) spending is required instead of just taking last year’s budget as the default,” 

Will wait and see.