Organizational Change and Accounting: Understanding the Budgeting System in its Organizational Context

TLDR

Using Foucault’s power/knowledge framework and sociological translation theory, the paper examines how a university budgeting system functions as both a vehicle for reallocating resources and a source of technical knowledge that shapes power relations during organizational change. The study aims to examine how the budgeting system is implicated in organizational change. The authors conduct a field study of a policy‑driven change initiative at a UK university facing state funding cuts. The Centre failed to use the budgeting system as a disciplinary regime to implement resource reallocations, while opposition groups leveraged technical accounting arguments and external critiques to challenge the Centre’s proposals and promote alternative strategies.

Abstract

This paper utilizes Foucault's framework of power/knowledge relations, but tressed by work on the sociology of translation (Callon 1986; Latour 1987), to examine the extent to which the budgeting system is implicated in a process of organizational change. The analysis is based on a field study in which a change initiative was developed by top policy-makers (the Centre) in a U.K. university against a background of reduction in funding by the state. The budgeting system is perceived to have relevance in this context at two levels: (i) as the vehicle through which reallocation of resources is effected, and (ii) as a means that provides actors with technical knowledge which can be utilized in the context of power relations. The analysis demonstrates that the Centre failed to deploy the budgeting system as a disciplinary regime in the sense of making it possible for the proposed resource reallocations to be implemented. The analysis also shows how the groups opposed to the proposed change: (i) through their technical knowledge successfully deployed arguments from within the accounting discipline to render the Centre's calculations 'incorrect' or at best debatable; (ii) combined these technical accounting arguments with arguments from outside the accounting discipline to cast strong doubts on the ethical and professional underpinnings of the Centre's proposals; and (iii) evolved, and promoted, a 'more viable' strategy to cope with the reduction in funding at the Centre's university.