Evidence of the relationship between budgetary participation, organizational commitment and managerial performance
DOI:
https://doi.org/10.5902/1983465938283Keywords:
Budgetary Participation. Organizational Commitment. Managerial PerformanceAbstract
Purpose – This research objective to investigate the relations between budgetary participation, organizational commitment and managerial performance.
Design/methodology/approach – A descriptive, survey and quantitative study was carried out, based on trajectory analysis and with data from 150 managers with budgetary responsibilities of the largest Brazilian export companies in the business.
Findings – The results reveal that budgetary participation influences managerial performance in two ways: directly, as a result of managers 'involvement and influence in the budgeting process, and indirectly, when managers' commitment to the organization increases due to their participation and involvement in budgetary definitions.
Research limitations/implications – The limitation of the use of self-reported measures to measure the proposed relationships is highlighted. This research indicates that behavioral aspects related to the budgeting process, have significant implications for work-related results.
Practical implications – The results suggest that organizations should allow the participation of managers in setting goals and budget objectives, as this action triggers a greater commitment of the individual to the organization and better performance in the work.
Social implications – The findings can help organizations to understand factors that can be improved in the organization so that employees feel committed to the company in which they operate and consequently present better budgetary participation and performance.
Originality/value – This research sought to expand the existing discussion in the accounting literature on the role of budgetary processes and their implications for organizational commitment and managerial performance in budgetary activities.
Downloads
References
Agbejule, A. & Saarikoski, L. (2006). The effect of cost management knowledge on the relationship between budgetary participation and managerial performance. The British Accounting Review, 38(4), 427-440.
Almasi, H., Palizdar, M. R., & Parsian, H. A. (2015). Budgetary participation and managerial performance: The impact of information and environmental volatility. Management Science Letters, 5, 843-854.
Cheng, M. T. (2012). The joint effect of budgetary participation and broadscope management accounting systems on management performance. Asian Review of Accounting, 20(3), 184-197.
Chong, V. K., Eggleton, I. R. C., & Leong, M. K. C. (2006). The Multiple Roles of Participative Budgeting on Job Performance. Advances in Accounting, 22, 67-95.
Chong, V. K., & Johnson, D. (2007). Testing a Model of the Antecedents and Consequences of Budgetary Participation on Job Performance. Accounting and Business Research, 37(1), 03-19.
Covaleski, M., Evans III, J. H., Luft, J., & Shields, M. D. (2007). Budgeting research: three theoretical perspectives and criteria for selective integration. In. Chapman, C. S., Hopwood, A. G., & Shields, M. D. Handbook of Management Accounting Research, 2(Cap. 6), 587-624.
Dakhli, A. (2010). Budgetary participation in a non-western country. Journal of Business in Developing Nations, 12, 1-31.
Dani, A. C., Zonatto, V. C. da S., & Diehl, C. A. (2017). Budget Participation and Managerial Performance: A Meta-Analysis of Relationships Found in Research Developed in the Behavioral Behavior of Accounting. Advances in Scientific and Applied Accounting, 10(1), 54-72.
Derfuss, K. (2016). Reconsidering the participative budgeting–performance relation: A meta-analysis regarding the impact of the level of analysis, sample selection, measurement, and industry influences. The British Accounting Review, 48(1), 17-37.
Eliyana, A., & Ma’arif, S. (2019). Job satisfaction and organizational commitment effect in the transformational leadership towards employee performance. European Research on Management and Business Economics, 25(3), 144-150.
Etemadi, H., Dilami, Z. D., Bazaz, M. S., & Parameswaran, R. (2009). Culture, management accounting and managerial performance: Focus Iran. Advances in Accounting, Incorporating Advances in International Accounting, 25(2), 216-225.
Falce, J. L. L., Paiva, K. C. M. de., Muylder, C. F. de., & Morais, M. M. dos S. (2017). Organizational Commitment: Longitudinal Study in a Public Higher Education Organization. Revista de Administração Mackenzie, 18(6), 124-148.
Francis-Gladney, L., Little, H. T., Magner, N. R., & Welker, R. B. (2004). Does Organization-Mandated Budgetary Involvement Enhance Managers’budgetary Communication with their Supervisor?. Advances in Management Accounting, 13(1), 167-182.
Gagné, M., & Deci, E. (2005). Self-determination theory and work motivation. Journal of Organizational Behavior, 26(4), 331-362.
Hariyanti, W., Purnamasari, P., & Lestira O, M. (2015). Pluriform motivation as antecedent and its relationships to budgeting participation and managerial performance (Empirical Study on Manufacturing Companies listed on Indonesian Stock Exchange). Procedia Social and Behavioral Sciences, 211, 836-843.
Her, Y. W., Shin, H., & Pae, S. (2018). A multigroup SEM analysis of moderating role of task uncertainty on budgetary participation-performance relationship: Evidence from Korea. Asia Pacific Management Review, 24(2), 140-153.
Jermias, J., & Yigit, F. (2013). Budgetary participation in Turkey: The effects of information asymmetry, goal commitment, and role ambiguity on job satisfaction and performance. Journal of International Accounting Research, 12(1), 29-54.
Ketchand, A. A., & Strawser, J. R. (2001). Multiple dimensions of organizational commitment: Implications for future accounting research. Behavioral Research in Accounting, 13(1), 221-251.
Lau, C. M., & Tan, S. L. (2005). The importance of procedural fairness in budgeting. Advances in Accounting, 21(1), 333-356.
Leite, N. R. P., Rodrigues, A. C. de A., & Albuquerque, L. G. de. (2014). Organizational commitment and job satisfaction: what are the potential relationships?. Brazilian Administration Review, 11(4), 476-495.
Lidia, T. G. (2015). An analysis of the existence of a link between budgets and performance in economic entities. Procedia Economics and Finance, 32, 1794-1803.
Macinati, M. S., Bozzi, S., & Rizzo, M. G. (2016). Budgetary participation and performance: The mediating effects of medical managers’ job engagement and self-efficacy. Health Policy, 120(9), 1017-1028.
Mahoney, T. A., Jerdee, T. H., & Carroll, S. J. (1963). Development of Managerial Performance: A Research Approach. Cincinnati, OH: South-Western Publishing.
Mahoney, T. A., Jerdee, T. H., & Carroll, S. J. (1965). The job(s) of management. Industrial Relations, 4(2), 97-110.
Mia, L., & Patiar, A. (2002). The interactive effect of superior-subordinate relationship and budget participation on managerial performance in the hotel industry: an exploratory study. Journal of Hospitality & Tourism Research, 26(3), 235-257.
Milani, K. (1975). The relationship of participation in budget-setting to industrial supervisor performance and attitudes: a field study. The Accounting Review, 50(2), 274-284.
Mowday, R., Porter, L., & Dubin, R. (1974). Unit performance, situational factors and employee attitudes in spatially separated work units. Organizational Behavior and Human Performance, 11(2), 231-248.
Mowday, R., Porter, L., & Steers, R. (1982). Organizational Linkages. New York: Academic Press.
Mowday, R. T., Steers, R. M., & Porter, L. W. (1979). The measurement of organizational commitment. Journal of Vocational Behavior, 14(2), 224-247.
Nguyen, T. T., Mia, L., Winata, L., & Chong, V. K. (2016). Effect of transformational-leadership style and management control system on managerial performance. Journal of Business Research, 70, 202-213.
Ni, F. Y., Su, C. C., Chung, S. H., & Cheng, K. C. (2009). Budgetary participation’s effect on managerial outcomes: Mediating roles of self-efficacy and attitudes toward budgetary decision makers. NTU Management, 19(2), 321-347.
Noor, I. H. B. M., & Othman, R. (2012). Budgetary participation: How it affects performance and commitment. Accountancy Business and the Public Interest, 1, 53-73.
Nor Yahya, M., Nik Ahmad, N. N., & Fatima, A. H. (2008). Budgetary participation and performance: some Malaysian evidence. International Journal of Public Sector Management, 21(6), 658-673.
Nouri, H., & Parker, R. J. (1998). The relationship between budget participation and job performance: The roles of budget adequacy and organizational commitment. Accounting, Organizations and Society, 23(5/6), 467-483.
Ortiz, D. A. C., Salgado, P. M., & Cázares, F. L. (2018). Satisfacción laboral y compromiso organizacional: prueba de equivalencia de medición entre México y Estados Unidos. Contaduría y Administración, 63(2), 1-18.
Otley, D. T. (1978). Budget use and managerial performance. Journal of Accounting Research, 16(1), 122-149.
Palomino, M. N. (2013). Conflict, role ambiguity and satisfaction at work: perceptions of Brazilian controllers. 136 f. Dissertation (Master in Accounting) - Graduate Program of the University of São Paulo, São Paulo.
Parker, R. J., & Kyj, L. (2006). Vertical information sharing in the budgeting process. Accounting, Organizations and Society, 31(1), 27-45.
Porter, L. W., Steers, R. W., Mowday, R. T., & Boulian, P. V. (1974). Organizational commitment, job satisfaction, and turnover among psychiatric technicians. Journal of Applied Psychology, 59(5), 603-609.
Rengel, R., Monteiro, J. J., Lunkes, R. J., Lavarda, C. E. F., & Schnorrenberger, D. (2020). Efeito das Características dos Gestores na Participação Orçamentária mediado pela Percepção de Justiça Processual. Contabilidade, Gestão e Governança, 23(2), 256-275.
Ronen, J., & Livingstone, J. (1975). An expectancy theory approach to the motivational impact of budgets. The Accounting Review, 50(4), 671-685.
Serna, M. D. C. M., Martínez, J. E. V., & Domenec, V. E. (2018). The influence of organizational commitment and learning orientation on innovation in SMEs. Contaduría y Administración, 63(3), 1-19.
Shields, J. F., & Shields, M. D. (1998). Antecedents of participative budgeting. Accounting, Organizations and Society, 23(1), 49-76.
Silva, L. P. da., Castro, M. A. R., Santos, M. G. dos., & Lima Neto, P. J. de. (2018). Comprometimento no trabalho e sua relação com a cultura organizacional mediada pela satisfação. Revista Brasileira de Gestão de Negócios, 20(3), 401-420.
Silva, C. C., Leite, N. R. P., & Rodrigues, L. C. (2016). Gestão estratégica de pessoas e comprometimento organizacional em organizações hospitalares. Revista de Administração da Universidade Federal de Santa Maria, 9(2), 192-209.
Soares, M. L., Teixeira, O. R. D. P., & Pelissari, A. S. (2011). Comportamento organizacional: uma aplicação da tipologia de Miles e Snow no setor hoteleiro de Florianóplis, SC. Revista de Administração da Universidade Federal de Santa Maria, 4(2), 251-267.
Subramaniam, N., Mcmanus, L., & Mia, L. (2002). Enhancing hotel managers’ organisational commitment: an investigation of the impact of structure, need for achievement and participative budgeting. International Journal of Hospitality Management, 21(4), 303-320.
Subramaniam, N., & Mia, L. (2001). The relation between decentralised structure, budgetary participation and organisational commitment: the moderating role of managers’ value orientation towards innovation. Accounting, Auditing & Accountability Journal, 14(1), 12-29.
Sugioko, S. (2010). The Impact of budget participation on job performance of university executives: A study of APTIK-Member Universities in Indonesia. Kasetsart Journal, 31, 271-279.
Venkatesh, R., & Blaskovich, J. (2012). The mediating effect of psychological capital on the budget participation-job performance relationship. Journal of Management Accounting Research, 24(1), 159-175.
Wong-On-Wing, B., Guo, L., & Lui, G. (2010). Intrinsic and Extrinsic Motivation and Participation in Budgeting: Antecedents and Consequences. Behavioral Research in Accounting, 22(2), 133-153.
Zonatto, V. C. da S. (2014). Influence of cognitive social factors of capacity, will, and opportunity on managerial performance in the budget activities of the largest exporting companies in Brazil. 411 f. Thesis (Doctorate in Accounting and Administration) - Post-Graduate Program in Accounting Sciences, Regional University of Blumenau, Blumenau.
Downloads
Published
How to Cite
Issue
Section
License
This journal remains the copyright holders of articles published. In order to be published, authors must sign the Copyrights Letter, which is sent to the authors by e-mail, thus granting rights, including on translation, to ReA/UFSM. The journal grants third parties the right to use, reproduce, and share the article according to the Creative Commons license agreement (CC-BY 4.0), as stated in the article’s PDF documents.
