Beyond Budgeting and Change: A Case Study

Journal of Accounting and Organizational Change10(3): 409-423, 2014

Posted: 19 Mar 2020

See all articles by Niels Sandalgaard

Niels Sandalgaard

Aalborg University

Per Nikolaj Bukh

Aalborg University - Department of Business and Management

Date Written: September 26, 2013

Abstract

Purpose – This paper aims to investigate reasons for going Beyond Budgeting and the practical issues organizations face when they change their management accounting system based on inspiration from the Beyond Budgeting model.

Design/methodology/approach – The authors apply a case study approach. The primary data source is interviews. The case company is a global company in the agri-food industry that is organized as a cooperative.

Findings – The authors propose that many organizations that change their management accounting system on the basis of inspiration from Beyond Budgeting will maintain fixed budget targets.Furthermore, the authors propose that even when the use of budgets at the corporate level focuses on few line items, the diagnostic use of budgeting at lower levels in the organization may focus on a larger number of line items.

Research limitations/implications – The study is subject to the usual limitations of case-based research. The propositions made in the paper should be further investigated in other organizations attempting to change their management accounting system with inspiration from Beyond Budgeting.

Practical implications – This study shows that the lack of internal benchmarks and the need to deliver the expected results to the company’s owners might hinder the implementation of the Beyond Budgeting model as described in the practitioner-based Beyond Budgeting literature.

Originality/value – The paper is one of the few case studies in the academic literature to analyze the practical issues organizations face when changing their way of budgeting on the basis of inspiration from Beyond Budgeting.

Keywords: Ownership Structure, Budgeting, Perceived Environmental Uncertainty, Relative Performance Evaluation, Beyond Budgeting, Fixed Performance Contract

Suggested Citation

Sandalgaard, Niels and Bukh, Per Nikolaj, Beyond Budgeting and Change: A Case Study (September 26, 2013). Journal of Accounting and Organizational Change10(3): 409-423, 2014, Available at SSRN: https://ssrn.com/abstract=3542784

Niels Sandalgaard

Aalborg University ( email )

Fredrik Bajers Vej 7E
Aalborg, DK-9220
Denmark

Per Nikolaj Bukh (Contact Author)

Aalborg University - Department of Business and Management ( email )

Aalborg, DK-9220
Denmark

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