The Effect Of Participation In The Preparation Of The Budget On Managerial Performance With Communication And Commitment As A Moderating Variable In The North Sumatra Province PDAM

by ADMIN 181 views

The Effect of Participation in the Preparation of the Budget on Managerial Performance with Communication and Commitment as a Moderating Variable in the North Sumatra Province PDAM

Introduction

The preparation of a budget is a crucial process in any organization, as it sets the direction for financial planning and resource allocation. Involving managers in the budgeting process can have a significant impact on their performance, as it allows them to take ownership of the budget and make informed decisions. However, the relationship between manager participation in the preparation of the budget and managerial performance is complex, and various factors can moderate this relationship. This study aims to investigate the effect of communication and organizational commitment as moderating variables on the relationship between manager participation in the preparation of the budget and managerial performance in the North Sumatra Province PDAM.

Background

Research on the effect of manager participation in the preparation of the budget on managerial performance has been carried out in various accounting studies, but the results are often diverse and show the factors that moderate this relationship. Participation theory states that individual involvement in decision making can increase their motivation and commitment, which can lead to improved performance. However, the role of communication and organizational commitment as moderating variables in this relationship is not well understood.

Methodology

This study uses a contingency approach to investigate the effect of communication moderation and organizational commitment on the relationship between manager participation in the preparation of the budget and managerial performance in the North Sumatra Province PDAM. The study uses primary data collected through the simple random sampling method with a written questionnaire. Research respondents are all managers (55 people) who work in the North Sumatra Province PDAM, both directly and indirectly involved in the process of preparing a budget. Data was analyzed using a multivariate data analysis method, which is a descriptive and inferential statistical method used to analyze data of more than two variables.

Independent, Dependent, and Moderating Variables

The independent variable in this study is manager participation in the preparation of the budget, with six items of questions. The dependent variable is managerial performance, with nine question items. The two moderating variables tested are communication (with twelve question items) and organizational commitment (with fourteen question items).

Results

The results showed four main findings:

  1. Manager's participation in budget preparation has a significant effect on managerial performance. This finding shows that involving managers in the budgeting process can improve their performance, in line with participation theory which states that individual involvement in decision making can increase their motivation and commitment.

  2. Communication as a moderating variable has no significant effect on the relationship between participation in the preparation of the budget and managerial performance. This means that good communication in the budgeting process is not enough to moderate the effect of participation on performance.

  3. Organizational commitment also does not have a significant effect as a moderating variable. This finding shows that although organizational commitment is important for managerial performance, it cannot moderate the effect of participation in the preparation of the budget on performance.

Implications

This research has several implications for the management of North Sumatra PDAM. First, it is important to involve managers in the process of preparing a budget to improve their performance. Second, focusing on communication and organizational commitment may not be enough to maximize the effect of participation on managerial performance.

Limitations

This research has several limitations. First, this research only focuses on the North Sumatra Province PDAM, so that the generalisability of the research results may be limited. Second, this research uses a survey method with a questionnaire, so it may be biased in data collection.

Conclusion

This study provides insights into the effect of communication and organizational commitment as moderating variables on the relationship between manager participation in the preparation of the budget and managerial performance in the North Sumatra Province PDAM. The findings suggest that involving managers in the budgeting process can improve their performance, but communication and organizational commitment may not be enough to moderate the effect of participation on performance. This study has implications for the management of North Sumatra PDAM and provides a basis for further research on the role of communication and organizational commitment in the budgeting process.

Recommendations for Further Research

For further research, it is recommended to expand the scope of research to various organizations and use more data collection methods, such as interviews and observations, to obtain more comprehensive data and reduce the potential for bias.

Theoretical Implications

This study contributes to the development of participation theory by providing insights into the effect of communication and organizational commitment as moderating variables on the relationship between manager participation in the preparation of the budget and managerial performance. The findings of this study have implications for the development of contingency theory, which suggests that the effectiveness of a management system depends on the context in which it is implemented.

Practical Implications

This study has practical implications for the management of North Sumatra PDAM and other organizations. The findings suggest that involving managers in the budgeting process can improve their performance, but communication and organizational commitment may not be enough to moderate the effect of participation on performance. This study provides a basis for further research on the role of communication and organizational commitment in the budgeting process and suggests that organizations should focus on involving managers in the budgeting process to improve their performance.

References

  • Participation theory
  • Contingency theory
  • Budgeting process
  • Managerial performance
  • Communication
  • Organizational commitment

Appendix

  • Questionnaire used in the study
  • Data analysis method used in the study
  • Results of the data analysis

Table of Contents

  1. Introduction
  2. Background
  3. Methodology
  4. Independent, Dependent, and Moderating Variables
  5. Results
  6. Implications
  7. Limitations
  8. Conclusion
  9. Recommendations for Further Research
  10. Theoretical Implications
  11. Practical Implications
  12. References
  13. Appendix
    Frequently Asked Questions (FAQs) about the Effect of Participation in the Preparation of the Budget on Managerial Performance

Q: What is the main objective of this study?

A: The main objective of this study is to investigate the effect of communication and organizational commitment as moderating variables on the relationship between manager participation in the preparation of the budget and managerial performance in the North Sumatra Province PDAM.

Q: What is the significance of this study?

A: This study is significant because it provides insights into the effect of communication and organizational commitment as moderating variables on the relationship between manager participation in the preparation of the budget and managerial performance. The findings of this study have implications for the management of North Sumatra PDAM and other organizations.

Q: What are the independent, dependent, and moderating variables in this study?

A: The independent variable in this study is manager participation in the preparation of the budget, with six items of questions. The dependent variable is managerial performance, with nine question items. The two moderating variables tested are communication (with twelve question items) and organizational commitment (with fourteen question items).

Q: What are the results of this study?

A: The results of this study showed four main findings:

  1. Manager's participation in budget preparation has a significant effect on managerial performance. This finding shows that involving managers in the budgeting process can improve their performance, in line with participation theory which states that individual involvement in decision making can increase their motivation and commitment.

  2. Communication as a moderating variable has no significant effect on the relationship between participation in the preparation of the budget and managerial performance. This means that good communication in the budgeting process is not enough to moderate the effect of participation on performance.

  3. Organizational commitment also does not have a significant effect as a moderating variable. This finding shows that although organizational commitment is important for managerial performance, it cannot moderate the effect of participation in the preparation of the budget on performance.

Q: What are the implications of this study?

A: This study has several implications for the management of North Sumatra PDAM. First, it is important to involve managers in the process of preparing a budget to improve their performance. Second, focusing on communication and organizational commitment may not be enough to maximize the effect of participation on managerial performance.

Q: What are the limitations of this study?

A: This study has several limitations. First, this research only focuses on the North Sumatra Province PDAM, so that the generalisability of the research results may be limited. Second, this research uses a survey method with a questionnaire, so it may be biased in data collection.

Q: What are the recommendations for further research?

A: For further research, it is recommended to expand the scope of research to various organizations and use more data collection methods, such as interviews and observations, to obtain more comprehensive data and reduce the potential for bias.

Q: What are the theoretical implications of this study?

A: This study contributes to the development of participation theory by providing insights into the effect of communication and organizational commitment as moderating variables on the relationship between manager participation in the preparation of the budget and managerial performance. The findings of this study have implications for the development of contingency theory, which suggests that the effectiveness of a management system depends on the context in which it is implemented.

Q: What are the practical implications of this study?

A: This study has practical implications for the management of North Sumatra PDAM and other organizations. The findings suggest that involving managers in the budgeting process can improve their performance, but communication and organizational commitment may not be enough to moderate the effect of participation on performance.

Q: What are the references used in this study?

A: The references used in this study include participation theory, contingency theory, budgeting process, managerial performance, communication, and organizational commitment.

Q: What is the appendix of this study?

A: The appendix of this study includes the questionnaire used in the study, the data analysis method used in the study, and the results of the data analysis.