problem: Mr. Sparks is CEO of a large manufacturing firm. He believes strongly that he is the keeper of all the knowledge of what is best for the firm. Mr. Sparks has traditionally prepared all of the budget estimates himself and then communicated results to his department managers. In the past years, however, he has begun to notice that department managers rarely manage to stay within their budgets & have many excuses for their failures. Mr. Sparks has also noticed a rise in is employee turnover, particularly at the managerial level.
[A] Define "participative budgeting" & how term relates to the current situation.
[B] How would you recommend the Mr. Sparks change budgeting procedures to gain more support from department managers?
[C] How does participative budgeting contribute to a positive budgeting atmosphere?