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The Complete Idiot's Guide to MBA Basics, 3rd Edition by Tom Gorman

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Sales Budgets and Variance Reports

In most companies, the sales budget represents a motivational tool, as well as a planning tool. During the budgeting process, the CEO goes to the sales manager and says something like, “Jim, we’re looking to grow the bottom line by 15 percent next year. Can we count on you folks in sales to increase the top line by that amount?”
 
Now, if Jim says, “No,” he’s not being a team player. But if he just says, “Sure!” without really thinking about it, he’s committing his people to growing sales by 15 percent. That might make sense sometimes, but other times it would be professional suicide.
 
So even though management always wants sales to increase, that could be hard to achieve for many reasons, including competitive ...

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