UNAIR NEWS 鈥聽The traditional model of corporate budget management has been applied for centuries.聽However, many companies are abandoning this model because it is not efficient.聽In the last decade, there have been innovations to manage corporate management, including the聽beyond budgeting聽model.
In a guest lecture at the Department of Accounting,聽聽, Dr. Sebastian Becker explained the development of the company鈥檚 management model.聽It includes the principle of model innovation聽beyond budgeting.聽The guest lecture was held online via Zoom and Youtube on Tuesday, May 16, 2023.
Business model canvas
Organizing the company鈥檚 budget requires a mature plan. Generally, companies use the business model canvas to describe their business organization. Dr. Becker said that in the past, the company only moved according to business models, such as transactional and subscription.
鈥淏efore the business model canvas mapping method was patented in 2010, it was difficult for the company to describe its operations.聽Then, the business model canvas develops, making it easier to visualize and describe the company鈥檚 business operations,鈥 he said.
Dr. Becker suggests using a model canvas when building a startup. He considers that one can clearly create, capture, and convey business value with this method.
Traditional management model
The management model relates to efforts to regulate the internal organization. Sebastian said, 鈥淚t relates to the choices of company executives about company goals, motivation and effort, coordination, and resource allocation. The point is about how the company is making its arrangements.鈥
The management model affects the setting the company鈥檚 budget.聽Many companies use a聽command聽and control聽management model.聽鈥淭his management model starts with budget planning carried out by a team of accountants or financial management.
Then, based on the budget, the company will set its goals or objectives. However, this is a traditional approach and has many drawbacks in terms of ineffective, inflexible, and inefficient enterprise settings,鈥 he explained.
More than just budget allocation (Beyond Budgeting)
Dr. Sebastian explained that the traditional management model had received criticism.聽For this reason, Jeremy Hope and Robin Fraser proposed an innovation in the management field.聽They came up with a model that is more than just a budget allocation (beyond budgeting).
鈥淭he most important thing is that this is not an innovation focused on accounting and budget allocation but a full management model.聽Through the聽beyond budgeting聽approach, companies will be able to create an adaptive, empowered, humane, environment that provides better performance,鈥 he said.
Principles in聽Beyond Budgeting
The principles of聽Beyond Budgeting are divided into two parts: the principles of leadership and management processes.聽Dr. Sebastian explained, 鈥淭he two parts are in harmony.鈥
The principle of leadership is a principle related to human management. On this principle, Dr. Sebastian explained a lot about the process of building the goals and values of the company. Also, form a reliable team.
Meanwhile, the management process is more technical. Dr. Sebastian said the process is more or less adopted from the traditional management model. Nevertheless, there is a more humane value adjustment in it.
Author: Muhammad Naufal Rabbani
Editor: Feri Fenoria
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