Beyond the Bottom Line

By Ed Sullivan  

In January, personal finance magazines offer advice on the best investments for the new year. The writers look at many options and identify opportunities to meet different financial needs.

Now imagine picking up one of those articles and finding that the writer, who is an expert on high-yield bonds, has written a fairly technical dissertation on why all investors should put their money into — surprise — high-yield bonds.

What the author hasn’t done, of course, is keep the audience in mind.

I wonder how often facility executives make the same mistake at budget time.

Those that do aren’t wrong if they argue that a company ought to replace an aging generator or that it can save money with a lighting upgrade. And many facility executives have the financial acumen to make a bottom-line case for their budget requests. But that’s not enough. To identify the best investments, it’s essential to keep the objectives of the organization in mind.

A lighting upgrade with a two-year payback might seem a good way to cut costs, but, if management plans to slash expenses next year, two years may be too long. Conversely, the expense of a new generator may be justifiable, even if budgets are tight, in a company concerned about business interruption.

From a facility perspective, both investments may be equally worthwhile. That’s why a facility executive needs to maintain a sense of distance, seeing the benefits and limitations of investments from the perspective of top management. After all, do you rely on magazines that don’t try to see things through your eyes?


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  posted on 2/1/2005   Article Use Policy

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