Where Should Your Money Go?
Every organization has a budget—but not every organization knows how to allocate resources wisely.
How do you decide where to invest and where to cut back? How do you ensure that every dollar is being used to drive real impact instead of just maintaining the status quo?
If you ask different team members, their department or project will always seem like the most important one. But if you only fund what people advocate for the loudest, you risk spreading resources too thin or missing bigger opportunities.
The easy solution is to divide funds evenly across departments. But the best leaders don’t settle for “fair”—they allocate resources where they create the highest return.
What every leader needs is a way to prioritize spending based on impact, not tradition.
The Problem: Not Every Dollar Carries the Same Value
Imagine your organization has $10,000 to spend.
You could use it to:
✅ Upgrade office technology to improve efficiency.
✅ Launch a new marketing campaign to attract customers.
At first glance, both options seem valid. But before you decide, ask:
- Which one moves our mission forward more?
- Which one produces long-term impact, not just short-term results?
- Which one generates momentum instead of just maintaining what we already have?
Many organizations default to the easier, more comfortable expense. That doesn’t mean it’s the best choice.
Not all spending is equal.
The Solution: Rethinking Your Budget With Value-Based Spending
Instead of justifying expenses based on last year’s budget, smart leaders compare costs against better alternatives.
Every spending decision should pass through these five key filters:
1. Opportunity Cost: What Else Could This Money Do?
A dollar spent in one area is a dollar that can’t be spent elsewhere.
👉 Key Question: If we spend this money here, what are we saying NO to?
🔹 Example: A company spends $50,000 annually on conference travel for employees. But shifting to virtual training could save half that cost—allowing the company to reinvest in leadership development programs that create lasting value.
2. Investment vs. Expense: What Does This Generate?
Some expenses grow the business. Others just keep the lights on.
👉 Key Question: Does this investment multiply growth, efficiency, or engagement?
✅ High-value investments:
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- Employee training that increases productivity.
- Marketing campaigns that generate new leads.
- Tools that automate tasks and save labor costs.
❌ Low-impact expenses:
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- Routine spending that goes unquestioned.
- Outdated systems that no one wants to change.
- Expenses that exist simply because “we’ve always done it this way.”
🔹 Example: A company is debating whether to upgrade its CRM system. The new system costs $25,000 but saves employees 10 hours a week—freeing them to focus on high-value tasks. That’s a good investment.
3. The Multiplication Factor: Will This Scale?
Instead of asking, “Can we afford this?”, leaders should ask:
👉 Key Question: Will this investment lead to long-term impact, or just maintain the status quo?
🔹 Example: A nonprofit can spend $10,000 in two ways:
1️⃣ Hosting a single event that boosts awareness but doesn’t generate ongoing engagement.
2️⃣ Developing an automated donor outreach system that continues to bring in new donors.
Which one creates sustained momentum?
4. Zero-Based Budgeting: If We Started Over, Would We Spend This?
Many budgets are copy-paste versions of last year’s numbers.
👉 Key Question: If we were starting from scratch today, would we still choose to spend money on this?
🔹 Example: A company still pays for print advertising because it’s “tradition,” but their digital marketing brings in 5x more customers at half the cost. Time for a shift.
🔹 Practical Shift: Before approving any budget item, ask:
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- Would we fund this if we weren’t already doing it?
- Is this generating measurable results?
5. Trade-Off Thinking: What’s the Better Choice?
Sometimes, organizations spend money simply because it’s available—not because it’s the best use of funds.
To shift this, leaders should compare two expenses side by side and ask:
👉 Key Question: Would I rather spend money on this or that?
🔹 Example: Would you rather…
✅ Spend $5,000 on company-branded swag?
✅ Or fund a new mentorship program that develops future leaders?
This forces leaders to make intentional choices, not just default to what’s easy.
How to Build a Budget That Drives Growth, Not Just Maintains It
Most organizations don’t need bigger budgets—they need smarter spending.
Here’s how to start:
✅ Apply value-based budgeting to every expense.
✅ Ask what else this money could do before spending.
✅ Focus on multiplying impact, not just maintaining operations.
Final Thought: True Stewardship Isn’t About Cutting Costs—It’s About Maximizing Value
Many leaders think good financial management means spending less.
But true financial stewardship means spending wisely.
The next time your organization approves an expense, ask:
👉 Is this the best way to use this money?
Because financial health isn’t just about how much you have—it’s about how well you use it.
Call to Action
💡 Want to lead smarter? Share this post with your team and start making every dollar count.
📩 Need guidance on financial leadership? Let’s talk. Visit gavinadams.com for leadership coaching.
Quotes for Inspiration
“A budget tells us what we can’t afford, but it doesn’t keep us from buying it.” – William Feather
“The best investment you can make is in yourself.” – Warren Buffett
Resources for Further Learning
📖 Essential Reads on Leadership & Budgeting:
- Profit First – Mike Michalowicz
- Essentialism: The Disciplined Pursuit of Less – Greg McKeown
- The Lean Startup – Eric Ries
One More Thing…
If you found this helpful, please pass it along to other leaders (and encourage them to subscribe!).
If you’re ready to accelerate your leadership, I’d be honored to help. Visit gavinadams.com to explore my systemic approach to leadership development and schedule a 30-minute conversation.
If you’re a church leader, be sure to visit the Church Accelerator Community.
Leading With You,
Gavin Adams
