Digitization of the budgeting process: determinants of the use of business analytics and its effect on satisfaction with the budgeting process

Mareike Bergmann (), Christian Brück (), Thorsten Knauer () and Anja Schwering ()
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Mareike Bergmann: Ruhr University Bochum
Christian Brück: Ruhr University Bochum
Thorsten Knauer: Ruhr University Bochum
Anja Schwering: Ruhr University Bochum

Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, 2020, vol. 31, issue 1, No 3, 25-54

Abstract: Abstract Since the use of business analytics promises automation of business processes and time savings, the budgeting process seems predestined for the integration of analytical methods. Therefore, this study examines the determinants of the use of business analytics in the budgeting process and its effect on satisfaction with the budgeting process. Specifically, we focus on one technical determinant (data infrastructure sophistication) and the importance of the two major budgeting functions (the planning and the evaluation function), which could affect the degree of dissemination of using analytical methods. Based on a survey among German companies, we find, as predicted, that the sophistication of the data infrastructure is positively associated with the use of business analytics in the budgeting process. Further, the more a company emphasizes the planning function, the greater the extent to which business analytics is used in the budgeting process. In contrast, we find no association between the evaluation function and the use of business analytics in the budgeting process. Finally, we find that the use of business analytics is positively associated with satisfaction with the budgeting process. Thus, the use of business analytics can help to overcome dissatisfaction with traditional budgeting systems. Overall, our findings provide practitioners with valuable indications under which circumstances the use of analytical methods appears reasonable.

Keywords: Analytics; Budgeting; Business intelligence; Digitization; Forecasts; Planning (search for similar items in EconPapers)
JEL-codes: M15 M41 (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (8)

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DOI: 10.1007/s00187-019-00291-y

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