Post-Implementation challenges of the Outcome-Based budgeting model in budgetary practices: a Malaysian perspective

Nurul Shuhada Mohd Gharib, Che Ruhana Isa and Zakiah Saleh

Journal of Accounting & Organizational Change, 2024, vol. 21, issue 4, 666-691

Abstract: PurposeThis study aims to explore the challenges in post-implementing the Outcome-Based Budgeting (OBB) model in budgetary practices in Malaysian Government agencies, in the context of government official’s perspective.Design/methodology/approachA qualitative methodology by collecting data from eight budget experts within federal government agencies through semi-structured interviews was used. Purposive sampling was used to select informants based on their relevant experiences and roles in the OBB model and associated budgetary processes. Data analysis involved thematic analysis using ATLAS.ti software, with member checking to enhance credibility.FindingsSustainability, innovation characteristics, organisational dynamics, individual capabilities and social context are identified as critical factors influencing the successful post-implementation of the OBB model in Malaysian federal government agencies. Organisational dynamics, encompassing policy control and Budget Review Officers role, as well as social factors, such as the presence of an OBB champion and broader buy-in, significantly impact the model’s effectiveness. These findings underscore the complex interplay of factors shaping the post-implementation phase of OBB in the Malaysian budgetary context.Research limitations/implicationsThis study is constrained by its qualitative methodology and focus on the Federal Government of Malaysia, limiting the generalisability of findings. Future research using quantitative or mixed methods, expanded to include other government entities and comparative analysis across government levels is recommended to enhance understanding of OBB implementation challenges.Practical implicationsThis research contributes to the existing body of knowledge on Performance-based budgeting (PBB) implementation, particularly in developing countries. By identifying critical success factors and barriers, it offers valuable insights for policymakers and practitioners seeking to improve public financial management. The study’s focus on Malaysia’s OBB experience provides timely and relevant information for addressing challenges in budgetary practices. Additionally, the research offers practical guidance for organisations navigating change management and building capacity for PBB implementation.Originality/valueThe study’s originality lies in its focus on the post-implementation challenges of the OBB within Malaysian Government agencies, which are largely under-studied. By using the Diffusion of Innovation theory, the study systematically investigates the interplay of sustainability, innovation characteristics, organisational dynamics, individual capabilities and social context in shaping OBB outcomes. Identifying sustainability and organisational dynamics as critical success factors contributes to the ongoing discourse on public sector budgeting reforms, particularly in developing country contexts.

Keywords: Outcome-based budgeting (OBB); Budgetary practice; Federal government of Malaysia (FGOM); Thematic analysis (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jaocpp:jaoc-11-2023-0197

DOI: 10.1108/JAOC-11-2023-0197

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