Management & Budgetary Control and the Beyond Budgeting debate Essay - 1

Management & Budgetary Control and the Beyond Budgeting debate - Essay Example Various advantages can come up from incorporating beyond budgeting technique in an organization. One of these is the fact that people get to improve in their creativity in the business market. Beyond budgeting requires the involved individuals or rather company members to provide plans that would lead to the production of a new commodity (Blyth 68). New commodities require a lot of attention because many people are keen on the details of the commodity in order to assess whether it can act as a substitute product. This thus offers companies opportunities to become market leaders in some fields (Martin and Hau 47). The fact that competition is a contemporary issue in the marketing sector is another factor to understand. Businesses have developed over time where they are required to attain certain market characteristics in order to retain or rather earn a certain position in an industry. These companies thus compete to attain these characteristics faster than their rivals in order to attract more companies. This strategy works effectively and is a result of beyond buying (Henry 64) There are various disadvantages however that come along with the beyond budgeting technique. The major disadvantage is that the companies risk losing their customers. The reason for this is indirect though (Fleisher 78). When companies engage in beyond budgeting, they take up activities that seek to prove that they are superior to the rival company. This normally has the effect of the companies not paying attention to the actual requirements of the customers but rather work while reviewing the performance of the other companies to identify its market position. The normal result of this is the depreciation of the commodities produced by the companies (Gregory 32). There is also the issue of unhealthy competition. Unhealthy competition happens when two industries within a

Institutional Theory in Governmental Organizations Literature review

Institutional Theory in Governmental Organizations - Literature review Example This pressure has forced many of them to adopt new strategies such as Institutional Theory and Performance Measurement Systems, in order to overcome this pressure. Factors making Institutional Theory applicable in the Public Sector There has been an increasing pressure, for governmental and other nonprofit organizations to adopt strategies such as Institutional Theory. It is claimed that these new strategies, will make them act more like profit-making organizations than just nonprofit organizations. According to Oliver (1997, p. 697-698), governmental organizations are more vulnerable to all the three types of institutional forces than other profit-making organizations. As he explains, researchers have shown that the susceptibility of public sector organizations to institutional pressures is extremely high due to the many stakeholders and customers that it serves. All this pressure has doomed it highly necessary for the governmental organizations to adopt strategies such as Instituti onal Theory and Performance Measurement. According to Peter and Joseph (2004, p. 283-285), the pressure that the public sector is experiencing, mainly comes from the non-profit organizations that rely on the government for funding. It is argued that non-profit organizations have grown in numbers and have evolved from small-locally owned to large, national owned organizations. Therefore, these organizations are pressuring the governmental sector more. This is because they require more funds to accomplish their elevated goals and sustain their large workforce. The state is another stakeholder that is pressuring the public sector in many countries. According to Brunson and Olsen (1993, p. 44-46), many governmental and nonprofit organizations are owned by the state or the government in many countries. Therefore, it is argued that many governments place a lot of pressure on their organizations, in order to gather popularity from the citizens. As Grafstein (1992, p. 223-225), the governme ntal organizations are also currently facing another pressure from the many customers that they serve. As he points out, many profit-making organizations have been applying the concepts of intuitional theory in their firms, so as to maintain and attract more customers. According to Katz and Khan (1978, p. 147), the services and goods being provided by the private and many other profit-making organizations are far much better compared to the ones provided by the same organizations owned by the government. As Grafstein explains, this has resulted in the governmental organizations’ customers demanding the same quality goods and services as the ones provided in the profit-making organizations. Therefore, it is claimed that many governmental and nonprofit organizations are adopting the Institutional Theory in their institutions to enable them to overcome this pressure.