Bydevelopingagrowthbudget,managersknowwhatresourcesareavailableforprojectsthatwillgeneraterevenuegrowth.Thegrowthbudgeteffectivelysetsouttheplanbywhichtheorganizationintendstofindgrowth,howitproposestofundthatsearchandwhenthoseadditionalrevenueswillcomeonstream.Inotherwords,agoodgrowthbudgetwillcoordinateacompany'seffortstoincreasesalesrevenues.
■Fundingsourcesforgrowthprojects
Resourcesthataretakenfromshrinkingproductlinesandreallocatedtogrowingproductlines
Resourcesthataretakenfromdivisionsthatarelosingmarketshareandreallocatedtodivisionsthatareincreasingtheirmarketshare
Reallocatingmoneythathasbeenassignedtoabroadgeneralizedfunctionlikeresearchanddevelopmenttospecificgrowthprojects
Whenadecisionismadetoincreasetheamountofmoneyanorganizationspendsinordertotrytogainadditionalrevenues,evenifthatimpactsnegativelyonshort-termfinancialperformance.