Main Article Content
Abstract
Purpose: This study explores the evolution of budgeting practices from traditional to contemporary technology-driven approaches. It examines how technological advancements and organizational changes have transformed budgeting processes, highlighting the shift towards more flexible and data-driven methodologies.
Research Design and Methodology: This study embarks on a journey of comprehensive literature review using a qualitative research approach. The methodology involves systematic searches of academic databases, thematic analysis and synthesis of findings from relevant studies. The research focuses on the design, implementation, and impact of both traditional and modern budgeting practices, as well as the challenges associated with technological adoption.
Findings and Discussion: The findings reveal that traditional budgeting methods, characterized by hierarchical and fixed targets, must be revised in dynamic business environments. Technological innovations, such as ERP systems and cloud-based platforms, significantly improve efficiency, accuracy, and decision-making. Alternative frameworks like the Balanced Scorecard and Beyond Budgeting promote strategic alignment and organizational agility. However, challenges such as data security, integration complexities, and resistance to change remain significant barriers to full adoption.
Implications: This study's findings have direct and practical implications for financial managers and policymakers seeking to optimize budgeting processes. Investing in robust data infrastructure and fostering a culture of continuous improvement is essential for leveraging the benefits of technological innovations. Future research should focus on the long-term impacts of these practices and explore strategies to overcome implementation challenges. This will help organizations achieve greater agility, responsiveness, and competitiveness in an increasingly digitalized business landscape.
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References
- Bartlett, C. A., & Mainzer, K. (2020). Decentralized Decision Making and Strategic Agility: The Role of Beyond Budgeting. California Management Review, 62(3), 66–92.
- Bayer, M., & Winkelmann, A. (2019). Zero-Based Budgeting as an Approach to Budgetary Reforms in the Public Sector. International Journal of Public Administration, 42(4), 354-366.
- Bhattacharjee, S., Jain, V., & Dutt, P. (2020). Technological Innovations and Budgeting Practices: A Review. International Journal of Business and Management Studies, 12(2), 143–154.
- Cardoș, V. (2014). Budget Evolution – Background, Traditional and Alternative Methods. Annals of the University of Petrosani, Economics, 14(2), 49-56.
- Chen, Y., Zhang, Y., Chen, H., & Liu, Y. (2021). Traditional Budgeting, Enterprise Information Technology Investment and Financial Performance. Journal of Physics: Conference Series, 1950(1), 012042.
- Choudhury, S., Kulkarni, U., & Kaur, H. (2019). Cloud-Based Budgeting Platforms: A Review. International Journal of Management, 10(2), 184–191.
- Davenport, T. H. (1998). Putting the enterprise into the enterprise system. Harvard Business Review, 76(4), 121-131.
- Hitt, L. M., Wu, D. J., & Zhou, X. (2002). Investment in Enterprise Resource Planning: Business Impact and Productivity Measures. Journal of Management Information Systems, 19(1), 71-98.
- Hope, J., & Fraser, R. (2003). Beyond budgeting: How managers can break free from the annual performance trap. Harvard Business Press.
- Jensen, M. C. (2001). Corporate budgeting is broken—Let's fix it. Harvard Business Review, 79(10), 94-101.
- Kaplan, R. S., & Norton, D. P. (1996). The Balanced Scorecard: Translating Strategy into Action. Harvard Business Review, 74(1), 76–85.
- Kumar, A., Jha, P., & Singh, N. (2021). Cloud-Based Budgeting Platforms: A Review. International Journal of Advanced Research in Management and Social Sciences, 10(12), 78-90.
- Langfield-Smith, K., & Smith, A. (2020). Zero-Based Budgeting: A Modern Approach to Budgeting. Journal of Management Accounting Research, 32(1), 57-68.
- Li, Y., Gao, Y., & Wang, S. (2022). The Impact of Cloud-Based Budgeting Platforms on Organizational Performance. Journal of Management Information Systems, 39(1), 187-213.
- Mithas, S., Ramasubbu, N., & Sambamurthy, V. (2019). How Information Technology Strategy and Investments Influence Firm Performance: Conjecture and Empirical Evidence. MIS Quarterly, 43(4), 1293–1322.
- Moores, K., & Yuen, S. (2020). Budgeting: A Contemporary Paradigm Shift. Journal of Modern Accounting and Auditing, 16(11), 1551–1561.
- Otley, D., & Emmanuel, K. (2013). Readings in accounting for management control. Springer.
- PricewaterhouseCoopers LLP. (2019). Budgeting in the Cloud: A New Era for Finance.
- PwC. (2019). Budgeting in the Cloud: A New Era for Finance. PricewaterhouseCoopers LLP.
- Qi-gao. (2007). From Traditional to Modern Budgeting: A New Approach to Public Management [Paper presentation]. Proceedings of the 2007 International Conference on Management Science and Engineering, 1383-1386.
- Renfors, P. (2018). Budgeting: Traditional, Better and Beyond – Characteristics and Functions. Journal of Modern Accounting and Auditing, 14(3), 103-117.
- Saliterer, I. (2018). The Development of Budgeting: From Traditional to Modern Techniques. European Research Studies Journal, 21(2), 524-544.
- Shields, M. D. (2013). Management control systems: European Edition. Pearson.
- Smith, J., Johnson, L., & Davis, K. (2020). The Use of Traditional Budgeting in Contemporary Organizations. Journal of Modern Accounting and Auditing, 16(8), 1277-1286.
- Wixom, B. H., & Watson, H. J. (2010). An Empirical Investigation of the Factors Affecting Data Warehousing Success. MIS Quarterly, 25(1), 17–41.
References
Bartlett, C. A., & Mainzer, K. (2020). Decentralized Decision Making and Strategic Agility: The Role of Beyond Budgeting. California Management Review, 62(3), 66–92.
Bayer, M., & Winkelmann, A. (2019). Zero-Based Budgeting as an Approach to Budgetary Reforms in the Public Sector. International Journal of Public Administration, 42(4), 354-366.
Bhattacharjee, S., Jain, V., & Dutt, P. (2020). Technological Innovations and Budgeting Practices: A Review. International Journal of Business and Management Studies, 12(2), 143–154.
Cardoș, V. (2014). Budget Evolution – Background, Traditional and Alternative Methods. Annals of the University of Petrosani, Economics, 14(2), 49-56.
Chen, Y., Zhang, Y., Chen, H., & Liu, Y. (2021). Traditional Budgeting, Enterprise Information Technology Investment and Financial Performance. Journal of Physics: Conference Series, 1950(1), 012042.
Choudhury, S., Kulkarni, U., & Kaur, H. (2019). Cloud-Based Budgeting Platforms: A Review. International Journal of Management, 10(2), 184–191.
Davenport, T. H. (1998). Putting the enterprise into the enterprise system. Harvard Business Review, 76(4), 121-131.
Hitt, L. M., Wu, D. J., & Zhou, X. (2002). Investment in Enterprise Resource Planning: Business Impact and Productivity Measures. Journal of Management Information Systems, 19(1), 71-98.
Hope, J., & Fraser, R. (2003). Beyond budgeting: How managers can break free from the annual performance trap. Harvard Business Press.
Jensen, M. C. (2001). Corporate budgeting is broken—Let's fix it. Harvard Business Review, 79(10), 94-101.
Kaplan, R. S., & Norton, D. P. (1996). The Balanced Scorecard: Translating Strategy into Action. Harvard Business Review, 74(1), 76–85.
Kumar, A., Jha, P., & Singh, N. (2021). Cloud-Based Budgeting Platforms: A Review. International Journal of Advanced Research in Management and Social Sciences, 10(12), 78-90.
Langfield-Smith, K., & Smith, A. (2020). Zero-Based Budgeting: A Modern Approach to Budgeting. Journal of Management Accounting Research, 32(1), 57-68.
Li, Y., Gao, Y., & Wang, S. (2022). The Impact of Cloud-Based Budgeting Platforms on Organizational Performance. Journal of Management Information Systems, 39(1), 187-213.
Mithas, S., Ramasubbu, N., & Sambamurthy, V. (2019). How Information Technology Strategy and Investments Influence Firm Performance: Conjecture and Empirical Evidence. MIS Quarterly, 43(4), 1293–1322.
Moores, K., & Yuen, S. (2020). Budgeting: A Contemporary Paradigm Shift. Journal of Modern Accounting and Auditing, 16(11), 1551–1561.
Otley, D., & Emmanuel, K. (2013). Readings in accounting for management control. Springer.
PricewaterhouseCoopers LLP. (2019). Budgeting in the Cloud: A New Era for Finance.
PwC. (2019). Budgeting in the Cloud: A New Era for Finance. PricewaterhouseCoopers LLP.
Qi-gao. (2007). From Traditional to Modern Budgeting: A New Approach to Public Management [Paper presentation]. Proceedings of the 2007 International Conference on Management Science and Engineering, 1383-1386.
Renfors, P. (2018). Budgeting: Traditional, Better and Beyond – Characteristics and Functions. Journal of Modern Accounting and Auditing, 14(3), 103-117.
Saliterer, I. (2018). The Development of Budgeting: From Traditional to Modern Techniques. European Research Studies Journal, 21(2), 524-544.
Shields, M. D. (2013). Management control systems: European Edition. Pearson.
Smith, J., Johnson, L., & Davis, K. (2020). The Use of Traditional Budgeting in Contemporary Organizations. Journal of Modern Accounting and Auditing, 16(8), 1277-1286.
Wixom, B. H., & Watson, H. J. (2010). An Empirical Investigation of the Factors Affecting Data Warehousing Success. MIS Quarterly, 25(1), 17–41.