Budgetary Reform Through Organizational Learning

Abstract

The legacy of budgetary reform has been dismal. Promising options, rooted in economic values, seem to fall short when confronted with political realities. Nevertheless, the search continues. The authors argue that successful budgetary reform requires attention to the organizational context, in particular human behavioral dynamics. The objectives and execution of budgetary reform must "match" the dynamic objectives and needs of the organization. Moreover, the authors argue that successful implementation requires planned organizational change, in which issues of behavioral change and organizational culture are addressed, as the reform is planned and implemented. They suggust that an organizational theory of budgeting offers not only a better explanation for the failures of budgetary reform but also some potential avenues for greater success in such reforms.

Gender‐responsive budgeting: A budget reform to address gender inequity

“…These findings about GRB are, again, consistent with the experiences of earlier budget reforms. For instance, Forrester and Adams (1997, p. 473) found that “the chance for successful budget reform increases if executive budget participants and program managers support the goals and objectives of the budget initiative and the legislature participates in the planning process.” They also found that there also must be buy‐in from budget office staff and agency leadership. In many efforts to reform the budget, agencies go through the motions rather than attempting to sincerely implement the reform.…”

“…“Aligning budgetary reform with organizational culture dramatically raises the likelihood of the personal and organizational ownership necessary for successful reform. Ownership is key because it provides the foundation for successful reform” (Forrester and Adams 1997, p. 475).…”

Budget theory in local government: the process-outcome conundrum

“…But the call for a more rational set of decision rules for making allocation decisions persisted, and the gap between normative and descriptive theory varied between wide and wider. Forrester and Adams (1997) offered a more expansive way to think about budget theory. Normative theory is a theory of budgeting, while descriptive theory is a theory about budgeting.…”

Leadership Factors in Organizational Change Process: Observations from the Perspective of Management Accounting

“…In the complexity of organizational change phenomena (Johnson et al, 2000;Cyert, 1990) and tendency towards change resistance among the followers (Forrester & Adams, 1997;Dawson, 1994;Child & Smith, 1987) the characteristic of transformational leadership is necessary. Studies on the efforts to change an organizational management accounting practice have documented the environmental complexity and followers' resistance (Coram & Burnes, 2001;Abdul Rahman, 1993).…”