308 ACCOUNTING FOR MANAGERS
appear to use budgeting in a political mode to allocate resources internally, but
the visibility of these internal budgetary allocations to external constituents also
appears to influence the generation of resources (Hackman 1985). This dual role
of budgeting in generating and allocating resources suggests an expanded linkage
between the values of external constituents and the internal resource needs and
uses of an individual organization, most particularly in times of financial stress.
Cyert and March (1963) have defined budgets as both the substance and result
of political bargaining processes that are useful for legitimizing and maintaining
systems of power and control within organizations. Similarly, Pfeffer (1981) argued
that a particularly effective way of influencing resource allocation decisions is to
do it as unobtrusively as possible, such as through the apparently objective
mechanism of the budgetary process which tends to legitimate subjective and
political decision-making processes (see also Pfeffer and Salancik 1974, 1978).
Here, according to Hopwood (1974), the trivial, dull, seemingly objective nature
of accounting enables it to be used in taking the debatable out of the realm of open
debate and into the realm of calculation. Consequently, these theorists considered
managerial accounting information such as budgeting as a socially constructed
phenomenon rather than a technically rational function driven by and serving the
internal operations of organizations. Moreover, these perspectives recognized that
once implemented, what a budgeting system accounts for shapes organizational
members’ views of what is important and, more radically, what constitutes reality.
Budgeting, then, has been implicated in the construction of social reality rather
than being the passive mirror of a technical reality. On this point, Pfeffer (1981,
184) concluded:
[t]he task of political language and symbolic activity is to rationalize and
justify decisions that are largely a result of power and influence, in order to
make these results acceptable and legitimate in the organization.Regarding the political perspective of budgeting, Wildavsky (1964, 1975, 1979)
long argued that budgeting systems achieve many purposes beyond control, that
they are at once forms and sources of power, and that they serve both the guardians
of scarce resources and the advocates of budgetary units. Wildavsky also reasoned
that inherently conflictual organizations may use budgets in establishing and
maintaining existing power relations as opposed to serving decision-making and
problem solving directly in a technically rational manner. Instead, he argued,
decision-making and problem solving are served by the sometimes asymmetrical
political confrontation between budgeters andbudgetees. Wildavsky concluded
that the political nature of budgeting may well be inherent in complex organiza-
tional life, and is not an aberrant defect in budgetary practice. Resource allocation,
he suggests, is not the consequence of dispassionate analysis, but emerges through
a subtle role of advocates and guardians. Building on Wildavsky’s analysis, Jons-
son (1982) sought to capture some of the implicit political dynamics by following
the way in which the budgetary process unfolded over three years in a Swedish
municipality in a time of financial stringency.
Edelman’s (1977) broader political view and his concern for probing the consent
of the governed in American politics also reflects concern for the significance