Structuring of the Budgetary Process and the Two Cultural Dimensions
Structuring of budgetary processes refers to the extent to which formalized rules and procedures are considered important for formulating budgets. For malized rules and procedures are embedded in budget manuals to ensure conformity in the actions and behaviors of individuals.
The individualism-collectivism dimension will have an impact on the felt need for developing budget manuals, and budgetary rules and procedures. In the individualistic culture, since people are more concerned about their self-interests than in the organization's goals, budget manuals and rules will be deemed quite necessary to dissuade individuals from straying far from the goals of the organization. In collectivistic cultures, however, where the "we" orientation is strong and conformity is high, deviant behaviors can be expected to be so negligible that rules to safeguard against nonconformity are likely to be perceived as unnecessary.