Question

Address the following with NIKE Inc.

1. What are the three major objectives of operational budgeting?

2. Briefly describe the type of human behavior problems that might arise if budget goals are set too tightly or too loosely.

Please remember that references are required for your initial post. This week please be sure to reference Chapter 23 of your eText and use APA style.

Answer 1

1. What are the three major objectives of Budgeting?

The three major objectives of operating budgeting are to establish specific goals for the operations in future, to manage, coordinate plans to achieve goals and compare the actual results with goals periodically.

1. Briefly describe the type of human behavior that might arise if budget goals are set too tightly?

People become discouraged due to higher performance expectations. If the budget is viewed as not achievable then the managers and employees can be discouraged and it will show negative effect on ability of the company to achieve its goals.

Too loosely:

If the budget goals are set too loosely then it will show negative impact of revenue that will reduce drastically and will not be 100% efficiency. It fails to motivate the employees and managers to achieve goals