Application of Zero-Based Budgeting (ZBB) in Recessionary Periods
By / Jun 3, 2025
In the face of economic downturns, businesses often find themselves scrambling to cut costs while maintaining operational efficiency. Traditional budgeting methods, which typically rely on incremental adjustments to previous budgets, frequently fall short in these challenging environments. This is where Zero-Based Budgeting (ZBB) emerges as a powerful alternative. Unlike conventional approaches, ZBB requires organizations to justify every expense from scratch, fostering a culture of fiscal discipline and strategic resource allocation. As companies navigate the uncertainties of a recession, ZBB provides a structured framework to identify inefficiencies, eliminate wasteful spending, and reallocate resources to high-impact areas.