The Initial Stage of Beyond Budgeting Implementation: A Case Study of an Automotive Company

Abstract

This case study aims to understand the initial stage of a new Performance Steering Initiative (PSI) which replace the traditional budget in a Business Unit (BU) of a Company from the Automotive Industry. It focuses on advancing forces and barriers of change at the initial phase of Beyond Budgeting implementation. Further, it analyses what are the roles of culture and leaders in this change. The research primary source of data are interviews with the leaders from different areas and levels of the BU. The data collected were examined with the use of Kasurinen Management Accounting Change (MAC) model. The emphasis is given on the key role of culture and leaders factor during MAC. The empirical results showed that in case the implemented changes are in alliance with the company's culture, the leaders can act as advancing force for the BU to adapt new Management Accounting (MA) practices. Based on these findings, the study proposes a new revised MAC model. In the revised model, the culture is shown as the base of MAC which influences other factors in the model. Leaders work as an advancing or hindering factor of change.