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Article: Budgeting and innovation: do budgets stifle creativity? David Marginson and Stuart Ogden report on a case study that has addressed this question in a leading global technology firm.(TECHNICAL MATTERS)
- Article from:
- Financial Management (UK)
- Article date:
- April 1, 2005
- Author:
CopyrightCOPYRIGHT 2005 Chartered Institute of Management Accountants (CIMA). This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Budgets have long had a bad press, but they have attracted even more flak recently for being at best inappropriate to modern business practice and at worst potentially harmful (1). The Beyond Budgeting Round Table (BBRT) has been one of their most vociferous critics. It argues, for example, that the necessary conditions of trust and empowerment in today's organisations "are not possible with budgets still in place, because the entire system perpetuates central command and control" (2). But research suggests that most businesses are still using some form of budgeting.
One important issue that relates directly to the BBRT's criticisms concerns how firms are ...