Budgeting and HR: A Dual Approach to Business Growth in Singapore
Richard Luecke, author of Management Essentials, compares budgeting to preparing for a trip: once a company sets its strategic destination, a budget confirms whether there are enough resources to get there. With this foundation, businesses can create actionable plans. As the saying goes: “Talent drives progress, but finance ensures stability.” Only with solid budgeting and strict financial oversight can companies achieve steady growth.
1. Budgeting Habits in Singapore SMEs
While specific statistics on budgeting practices are scarce, recent surveys of Singapore’s SMEs highlight a clear trend: many companies struggle with cash flow, rising costs, and profitability. For example, the QBE Singapore SME Survey 2024–2025 shows that 66% of SMEs cite increased costs and reduced profitability as their top challenge, while over half face issues with cash flow and funding access. Similarly, the DBS SME survey noted that 43% of SMEs prioritize managing costs and maintaining cash flow. These concerns reveal that structured budgeting is more crucial than ever for sustainable growth.
2. The Risks of Operating Without Annual Budgets
Without proper annual budgets and business plans, companies struggle to set clear goals. Departments operate without direction, performance evaluations become subjective, and employees lose motivation. This leads to stagnation, high turnover, and talent gaps. When owners alone make financial decisions without structured budgeting, department managers lose influence, and organizational efficiency suffers.
3. The Three Steps of Budget Management
Effective budgeting follows three key steps: Plan, Budget, Forecast.
- Plan: Define the company’s long-term direction.
- Budget: Set methods for achieving the planned goals.
- Forecast: Track whether execution aligns with original plans.
This framework shows how budgeting is not just about money—it directly affects strategic goals, departmental actions, and employee alignment.
4. HR Performance Reviews as a Business Backbone
Much like budgeting, HR performance reviews are part of a company’s DNA. Robust budgets need equally strong assessment systems to keep business growth on track. With structured evaluations, employees stay engaged, and companies build sustainable growth. In Singapore’s competitive landscape, performance systems are essential to retaining top talent and improving company stability.
5. How Absolute Evaluation Strengthens HR Systems
Tomorrow’s Team’s Absolute Evaluation empowers companies to strengthen HR while implementing assessments. With a large database of evaluation items from over 1,000 Japanese companies, Tomorrow’s Team tailors goal management to match your business cycle. Dedicated consultants conduct employee briefings, ensure transparency, and provide regular follow-ups to refine operations. With a cloud-based evaluation system, companies gain real-time feedback and streamlined goal tracking. This helps businesses retain talent, improve engagement, and maintain steady growth.
Conclusion: Finance and People as Twin Engines of Growth
When companies balance budgeting and HR systems, they create twin engines for sustainable success. Sound financial planning ensures stability, while effective performance reviews nurture talent and drive progress. Together, they enable businesses in Singapore to grow with confidence.
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