Practice Developments in Budgeting: An Overview and Research Perspective

40 Pages Posted: 28 Sep 2003  

Stephen C. Hansen

Naval Postgraduate School

David Otley

Lancaster University

Wim A. Van der Stede

London School of Economics & Political Science (LSE)

Multiple version iconThere are 2 versions of this paper

Date Written: May 2003

Abstract

Practitioners in Europe and the U.S. recently have proposed two distinct approaches to address what they believe are shortcomings of traditional budgeting practices. One approach advocates improving the budgeting process and primarily focuses on the planning problems with budgeting. The other advocates abandoning the budget and primarily focuses on the performance evaluation problems with budgeting. This paper provides an overview and research perspective on these two recent developments. We discuss why practitioners have become dissatisfied with budgets, describe the two distinct approaches, place them in a research context, suggest insights that may aid the practitioners, and use the practitioner perspectives to identify fruitful areas for research.

Keywords: budgeting, planning, strategy, activity based budgeting

JEL Classification: M40, M46

Suggested Citation

Hansen, Stephen C. and Otley, David and Van der Stede, Wim A., Practice Developments in Budgeting: An Overview and Research Perspective (May 2003). Available at SSRN: https://ssrn.com/abstract=410544 or http://dx.doi.org/10.2139/ssrn.410544

Stephen C. Hansen (Contact Author)

Naval Postgraduate School ( email )

555 Dyer Road
Monterey, CA 93943
United States
831-656-3930 (Phone)

David T. Otley

Lancaster University ( email )

The Management School
Lancaster LA1 4YF
United Kingdom
+441 524 593 632 (Phone)
+441 524 652 01 (Fax)

Wim A. Van der Stede

London School of Economics & Political Science (LSE) ( email )

Houghton Street
London, WC2A 2AE
United Kingdom
+44 (0)20 7955 7420 (Fax)

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