Traditional budgeting often starts with last year's numbers and adjusts them. Activity-based budgeting flips that — it starts with what you're actually doing. You identify the activities that drive costs, then build your budget around those.

Think about it this way: instead of saying "we spent 50 million VND on production last year, let's budget 55 million," you're saying "we process 200 orders per week, each order requires these specific activities, and those activities cost this much."

Most businesses start noticing changes within the first three months — not massive transformations, but clearer visibility into where money's going. By month six, you're usually making smarter decisions based on actual cost drivers rather than gut feelings.

The timeline depends on your starting point. Companies with good existing data move faster. Organizations where everything's tracked in spreadsheets might need more setup time. But even during implementation, the process itself often reveals inefficiencies you can address immediately.

You can absolutely start with existing tools. Most of our clients begin by adapting their current accounting software and spreadsheets. The methodology matters more than the technology.

That said, specialized software makes life easier once you've got the basics down. We usually recommend getting the process working manually first, then automating what makes sense. Jumping straight to expensive software before understanding your activities rarely works out.

Actually, that's when activity-based budgeting shines. Traditional budgets get thrown off completely when operations shift. Activity-based approaches adjust naturally because they're built around what you're doing, not arbitrary line items.

The key is setting up flexible cost drivers. When activities change, you update the drivers and the budget adjusts accordingly. It takes some maintenance, sure — but way less scrambling than rebuilding a traditional budget from scratch every time something shifts.

This trips people up constantly. You can track every tiny activity, but you'll spend more on tracking than you save. The sweet spot is identifying activities that represent significant costs or strategic importance.

Start with activities that account for at least 5% of your budget or directly impact your competitive advantage. You can always add more detail later if you need it. But beginning with 50 micro-activities usually leads to exhaustion and abandoned projects.

Resistance is normal — people worry about extra work or exposing inefficiencies in their departments. The solution isn't forcing compliance; it's demonstrating value quickly.

We've found success by starting with one department that's already frustrated with their current budgeting process. Let them see improvements, then use them as internal advocates. When other departments see real benefits rather than just top-down mandates, adoption happens naturally.