Finance

AI makes zero-based budgeting a practical finance tool

Published

2 years ago

May 14, 2024

AI makes zero-based budgeting a practical finance tool

Experts in the pursuit of harnessing nuclear fusion will assure you that the technology is coming — just 30 years away, according to their projections.

The joke is that if you wait three decades and ask them where it is— they’ll say the same thing.

In finance and procurement, the concept of zero-based budgeting has long been a bit like the pursuit of fusion power: more of an aspiration rather than something any real-world corporation can actually implement today.

Which is unfortunate. Like the idea of the world utilizing the free, non-polluting energy that a fusion plant would offer, on paper ZBB promises objective, data-based baselines for every budgeting phase that would allow decision-makers to only work with what’s real and current, not what happened last year, or even farther back.

The proposal with ZBB is that by mandating a comprehensive justification and validation of each expense, rather than relying on historical spending patterns, organizations can remove possible blockers within their procurement processes. This approach aims to ensure that what you’re doing is the numerically provable best case for the specific circumstances at hand.

This approach certainly holds immense appeal, so much so that Jimmy Carter tried and failed to make federal government adhere to this discipline in the second half of the 1970s. However, ZBB never really gained traction or widespread adoption, and so its aspirations were largely relegated to the realm of “theory taught in business schools but lacking practical viability.”

The factors putting ZBB back on the table

History and controversy aside, the core idea of ZBB is clear — it presents CFOs with an approach that mandated comprehensive justification and explicit approval for all expenditures during each new budgetary cycle, typically at the outset of the financial year. This process ostensibly offered CFOs a way to make relevant decisions against a true picture of the company’s cash flow.

But ZBB never truly went away. In fact, it is experiencing a resurgence. Consulting firms like McKinsey have reminded us that if we could weigh the value of every dollar and start afresh with every budget cycle we could mitigate the risks associated with operating on outdated information and boost overall performance outcomes.

ZBB idealism is also happening at the micro-level, with social media influencers hopping on the ZBB bandwagon. Influencers like Beth Fuller have attributed their ability to pay off credit card debts to following online content creators who advocate for ZBB principles.

The question then becomes how would we make ZBB, long an ideal but one that proved too difficult to implement, work at the enterprise level? It turns out, a viable way exists, or at least we can start the process to get there.

And you won’t be surprised to learn that the game-changer here is AI.

A way to open the door to ZBB

Currently, the spotlight within the artificial intelligence domain is on finding use cases for AI to solve real business problems. Organizations have been at the forefront of this endeavor for several years through an approach we term “autonomous sourcing.”

Specifically, organizations using an autonomous spend management approach source can purchase as many new services and vendors as they need within a given budgetary cycle. However, this process is underpinned by not just genuine and up-to-date market data, but also with the benefit of a corporate knowledge bank. This knowledge base facilitates multidimensional comparisons, enabling organizations to evaluate purchases not only longitudinally (against previous periods) but also orthogonally, meaning across different business units within the enterprise.

This may not be the precise dictionary definition of ZBB. But it represents a radical change from the lack of data and visibility CFOs have struggled with and a way to open the door to the underlying vision of ZBB: data-driven financial accuracy.

This autonomous spend management approach resonates with organizations seeking to rationalize and optimize their budgeting processes, often commencing with their procurement operations. These forward-thinking entities inherently grasp the transformative potential of leveraging machine learning and generative AI capabilities to tackle the sourcing problem.

And the convergence of machine learning, generative AI and autonomous sourcing platforms presents organizations with the ability to realize approximately 90% of the ZBB ideal in the present day. That’s happening via organizations using autonomous sourcing to consciously and strictly seek to rationalize every purchase and make data-driven decisions on every vendor relationship.

The commitment to data-driven evaluation of vendor relationships is actually super-important on the path to any form of zero-based decision-making basis. Why? Because it’s your best way of ensuring that you’re not locked into any partnerships or contractual arrangements that aren’t continuing to add value.

Even starting to explore this area of spend with proper data and analytical tools can move organizations off the proverbial sandbar of inefficiency. Last year, for instance, the Mays Business School published research that concluded the simple act of tracking a single category of expenditure can catalyze a reduction in overall spending.

The exciting prospect lies in the potential for modern businesses with diverse spending categories like marketing, HR, sales, IT, finance, and others to capitalize on significant cost-saving opportunities through AI-powered procurement solutions, e.g., accurate supplier sourcing and matching, e-negotiation and automated awarding capabilities.

ZBB’s future is now, not 30 years off

President Carter’s administration wanted to achieve such objectives and possibly on paper could have done — if they had all the time in the world, and exclusive access to the entire computing power of the United States at the time.

But even under those circumstances ZBB might not have worked — as without the efficiencies afforded by AI, ZBB would require manual sourcing, selecting, bidding, negotiating and awarding for every single purchase and vendor relationship in the business.

The truth is, fulfilling every aspect of ZBB manually, as envisioned by its originator, Pete Phyrr, is an insurmountable task for humans. However, using the power of AI to automate numerous processes, alongside giving individual business units the autonomy to source and complete their own purchases through autonomous sourcing, means ZBB becomes not just practicable, but essential in today’s dynamic business landscape.

Weighing it all up, maybe we can retire the notion that ZBB is the accounting industry’s version of fusion.

Instead, we can use the power of autonomous sourcing to perform the equivalent of fusion in the back office.

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Finance

Plano-Based Finance of America Announces $2.5B Partnership with Funds Managed by Blue Owl to Expand FOA’s Home Equity Lending

Published

7 hours ago

December 12, 2025

Press Room

Plano-Based Finance of America Announces .5B Partnership with Funds Managed by Blue Owl to Expand FOA’s Home Equity Lending

Graham Fleming, CEO of Finance of America [Composite image; source: Finance of America/DI Studio]

Finance of America Companies, a leading provider of home equity-based financing solutions for a modern retirement, and funds managed by Blue Owl Capital, a leading alternative asset manager, announced an enhanced $2.5 billion strategic partnership to accelerate product innovation and distribution for the nation’s fast-growing retirement demographic.

With more than 10,000 Americans entering retirement age every day, the market for home equity access continues to expand. FOA said its collaboration with New York City-based Blue Owl positions it to capture significant share in this rapidly evolving sector.

“This is a pivotal moment not just for Finance of America, but for the senior finance market as a whole,” Graham Fleming, CEO of Finance of America, said in a statement. “By aligning with Blue Owl, we are creating a platform of scale and innovation to better serve one of the fastest-growing demographics in the United States.”

The enhanced partnership includes, per FOA:

$2.5 billion commitment for new product innovation, providing scale and liquidity to support origination growth across multiple asset classes
$50 million equity investment in Finance of America, enhancing long-term alignment between the companies and supporting FOA’s continued growth initiatives
Joint innovation and product-development initiative focused on the continuous rollout of new, differentiated financial products tailored for people looking to maximize freedom, security, and opportunity throughout their retirement

This product expansion will complement FOA’s existing industry-leading reverse mortgage product suite while strengthening the company’s commitment to innovation and its role as a leader in delivering powerful financial solutions for retirees.

FOA said it continues to empower retirees with responsible, flexible access to capital to support aging in place, healthcare expenses, and lifestyle goals.

The partnership reinforces Finance of America’s mission to provide comprehensive, retirement-focused financial solutions, with the goal of expanding beyond reverse mortgages to become the nation’s leading, full-spectrum home equity lending platform, the company said.

“We believe Finance of America is uniquely positioned to redefine how financial products are delivered to retirees,” said David Aidi, senior managing director and co-head of Asset Based Finance at Blue Owl.

“This partnership provides the capital, the strategic alignment, and the innovation engine to build category-defining products at scale,” added Ray Chan, senior managing director and co-head of Asset Based Finance at Blue Owl.

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Finance

Bérangère Michel announced as BBC Group Chief Financial Officer

Published

19 hours ago

December 12, 2025

Press Room

Bérangère Michel announced as BBC Group Chief Financial Officer

The BBC has announced that Bérangère Michel has been appointed to the role of Group Chief Financial Officer.

Bérangère brings extensive experience from her 16-year career at the John Lewis Partnership, where she held senior roles including Chief Financial Officer, Customer Service Executive Director, Operations Director and Finance & Strategy Director.

Prior to joining the John Lewis Partnership, Bérangère spent 11 years at the Royal Mail Group in a number of finance, change and strategy roles, including as Finance Director of the property division.

In an expanded role as BBC Group Chief Financial Officer, Bérangère will be responsible for the overall BBC Group financial strategy, with a remit across BBC Public Service, BBC Studios and the BBC’s commercial subsidiaries. She will play a leadership role and will sit on both the Executive Committee and, for the first time, the Board.

This position will strengthen the BBC’s financial leadership, support its transformation, and make the best use of the licence fee and commercial opportunities. Bérangère will report to the Director-General and will take up the role in early January.

Director-General Tim Davie says: “Bérangère brings a wealth of experience from her time at the John Lewis Partnership and will play a critical role in shaping our new financial strategy. I’m pleased to welcome her to the BBC, and to both the Executive Committee and Board.

“Bérangère’s appointment to this expanded role comes at an important time for the BBC, as we look ahead to Charter renewal and continue to accelerate our transformation to deliver outstanding value for our audiences.”

BBC Chair Samir Shah says: “The role of Group Chief Financial Officer will be hugely important as we build a BBC for the future, and I look forward to welcoming Bérangère to the Board.”

Bérangère Michel says: “I am delighted to be joining the BBC, an institution whose purpose and mission I have always admired. It’s a privilege to be part of shaping its exciting future at such a crucial moment and I cannot wait to get started.”

BBC Press Office

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Finance

ATI Promotes Longtime Leader to CFO and SVP of Finance

Published

1 day ago

December 11, 2025

Press Room

ATI Promotes Longtime Leader to CFO and SVP of Finance

Rob Foster, incoming CFO of ATI Inc., effective Jan. 1, 2026 [Photo: ATI}

ATI Inc., a Dallas-based manufacturer of high-performance materials for the aerospace and defense industries, announced that James Robert “Rob” Foster will be promoted to senior vice president of finance and chief financial officer, effective January 1, 2026.

Foster succeeds Don Newman, who will serve as strategic advisor to the CEO beginning January 1. As previously announced, Newman will retire on March 1, 2026, and serve in an advisory capacity in that time to allow for a smooth transition.

“Rob is a proven P&L leader with enterprise-wide experience in the areas that matter most to ATI’s continued growth,” Kim Fields, president and CEO, said in a statement. “He brings deep expertise not only in finance but also as an operational leader. Rob played a pivotal role in the successful Specialty Rolled Products transformation, consistently helping ATI to deliver strong returns and shareholder value. I look forward to partnering with him as we enter our next phase of profitable growth.”

Foster, a longtime ATI leader, brings both operational expertise and financial discipline to the CFO role, the company said. He most recently served as president of ATI’s specialty alloys & components business, where he improved efficiency, grew capacity, and advanced the company’s role as a global leader in exotic alloys. Foster previously served as vice president of Finance, Supply Chain, and Capital Projects, overseeing ATI’s global finance organization, capital deployment processes, and enterprise supply chain performance. Earlier in his career, he led Finance for both ATI operating segments and the Forged Products business.

“I’m honored to become ATI’s next CFO,” said Foster. “ATI is well-positioned with a strong balance sheet, focused strategy, and significant opportunities ahead. I look forward to working with our team to drive disciplined investment, operational excellence, and long-term value creation for our shareholders.”

Newman added, “Rob is an exceptional leader who understands ATI’s strategy, operations, and financial drivers. He has delivered transformative results across the organization. I look forward to supporting a seamless transition as we pursue this next step in our succession planning.”

Before joining ATI in 2012, Foster held senior finance roles at API Technologies Corp. and Spectrum Control Inc., where he led ERP implementations, acquisition integrations, and internal control enhancements. He began his career as an auditor at Ernst & Young (EY).

ATI produces high-performance materials and solutions for the global aerospace and defense markets, and critical applications in electronics, medical, and specialty energy.