Beyond Budgeting Case Study

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Founded on the report introduction above, and by implementing Handelsbanken as a case study, following problem statement has been conducted: How do compensation schemes impact motivation in a Beyond Budgeting setting? In order to answer the given problem statement, following research questions have been designed: 1. What is Beyond Budgeting and why is it so critical of individual and financial bonuses? 2. What related factors within a Beyond Budgeting management model influence motivation from compensations? 3. What factors within compensation systems motivate employees? Purpose of the study The research questions are designed in order to help understand the scope of Beyond Budgeting, as well as provide an understanding of which related…show more content…
The paper contributes to management accounting research by identifying the impact on employee motivation in a Beyond Budgeting setting. There are many studies on the use of Beyond Budgeting and dynamic management as a foundation for management control. However, there is very little research that links the Beyond Budgeting philosophy to the motivational effects from their incentive systems. As the Beyond Budgeting literature continues to draw attention among companies worldwide, it becomes increasingly relevant to view compensation systems in the light of firms that operate with dynamic management models. As no organizations are identical, the findings of this study are to a large extent dependent on situational factors. Due to the use of a single-case study in this research paper, the applicability and generalizability is limited. However, organizations operating within a similar context of Handelsbanken may find the research relevant.…show more content…
This view is later challenged by Douglas McGregor (1960), who presents one of the first content theories on work motivation. Taylor’s (1911) initial presumption is that humans are fundamentally unmotivated and that they will not perform without extrinsic rewards or punishment. McGregor (1960) instead presents his two opposing views on how employees are motivated; he introduces the X and Y Theory. Theory X is built on the beliefs of Taylor, that individuals largely dislike work and responsibility, have low ambitions and prefer to be under control with clear boundaries and directions. Contrary, Theory Y is built from a belief that motivation is intrinsic to the individual. The Theory Y assumes that employees are happy to work, are self-motivated and creative, and enjoy working with greater responsibility. McGregor’s personal views favored theory Y, and he argued that individuals are in general creative and self-motivated (McGregor,

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