Encourage active participation in budget preparation

Oct 13, 2025 by magicalceylontours.com 122 views

Introduction

The North Sumatra Provincial Government is one of the largest and most complex government institutions in Indonesia, with various Regional Work Units (SKPD) working together to achieve the government's goals and objectives. The performance of these SKPDs is crucial in determining the overall success of the government. However, the factors that influence the performance of these SKPDs are complex and multifaceted. This study aims to investigate the effect of participation in the preparation of the budget and organizational commitment on the performance of the SKPD in the North Sumatra Provincial Government.

Literature Review

Participation in the preparation of the budget is an essential aspect of public sector management. It involves the active involvement of stakeholders, including SKPD members, in the budget preparation process. This approach is based on the principle of accountability and transparency, which is essential in ensuring that public funds are used effectively and efficiently. Research has shown that participation in the preparation of the budget can have a positive impact on the performance of public sector organizations (Brewer & Hayes, 2000; Graddy & Chen, 2006).

Organizational commitment, on the other hand, refers to the degree to which employees are committed to their organization and its goals. It is a critical factor in determining the performance of public sector organizations, as it affects the motivation, job satisfaction, and turnover intentions of employees (Meyer & Allen, 1991). Research has shown that organizational commitment is positively related to job performance, organizational citizenship behavior, and employee retention (Eisenberger et al., 1986).

Methodology

This study uses a causal research design to investigate the effect of participation in the preparation of the budget and organizational commitment on the performance of the SKPD in the North Sumatra Provincial Government. The data were collected through questionnaires distributed directly to respondents. The data collection process took two weeks, and the data were analyzed using the data analysis method, which included testing classical assumptions, hypothesis testing, and multiple regression analysis. Hypothesis testing was carried out using the F test, T test, and the coefficient of determination test.

Results

The results of this study indicate that participation in the preparation of the budget has a positive influence on SKPD performance partially. This means that when SKPD members are involved in the budget preparation process, they will feel more responsible for the budget, and this will have a positive impact on their performance in carrying out governmental tasks. Conversely, organizational commitment does not have a significant effect on the performance of the SKPD in North Sumatra Province. This might indicate that although SKPD members have a good commitment to the organization, this is not always followed by an increase in performance.

Interestingly, this research also found that participation in the preparation of budget and organizational commitment simultaneously had an impact on the performance of the SKPD. This indicates that both of these factors, despite having different influences, remain interrelated in the context of SKPD performance. When the participation of budget preparation is carried out well, although organizational commitment does not have a direct impact, the overall performance of the SKPD can be raised.

Discussion

The results of this study provide important insights for managers and leaders in the government environment. SKPD performance improvement strategies can be carried out by encouraging active participation in budget preparation. In this way, SKPD members not only feel more responsible, but also contribute directly to better performance results. In this case, although organizational commitment is also important, an emphasis on budget participation can be a more effective first step to improve the performance of the SKPD in the North Sumatra Provincial Government.

Conclusion

This research provides important insights for further studies of the factors that influence government performance, as well as providing practical recommendations to increase the effectiveness of the SKPD. The findings of this study suggest that participation in the preparation of the budget is a critical factor in determining the performance of the SKPD. Therefore, managers and leaders in the government environment should prioritize budget participation as a key strategy for improving SKPD performance.

Recommendations

Based on the findings of this study, the following recommendations are made:

Encourage active participation in budget preparation: Managers and leaders in the government environment should encourage active participation in budget preparation among SKPD members. This can be achieved through regular meetings, training programs, and other forms of engagement.
Develop a participatory budgeting system: The government should develop a participatory budgeting system that involves SKPD members in the budget preparation process. This can be achieved through the use of technology, such as online platforms, to facilitate participation.
Monitor and evaluate budget participation: The government should monitor and evaluate budget participation among SKPD members. This can be achieved through regular surveys, focus groups, and other forms of evaluation.
Provide training and development programs: The government should provide training and development programs for SKPD members to enhance their skills and knowledge in budget preparation and management.

Limitations

This study has several limitations that should be noted. Firstly, the study was conducted in a specific context, namely the North Sumatra Provincial Government. Therefore, the findings may not be generalizable to other contexts. Secondly, the study relied on self-reported data from SKPD members, which may be subject to biases and errors. Finally, the study did not control for other factors that may influence SKPD performance, such as leadership style, organizational culture, and external factors.

Future Research Directions

This study provides a foundation for further research on the factors that influence government performance. Future research should investigate the following:

The impact of leadership style on SKPD performance: Research should investigate the impact of leadership style on SKPD performance, including the role of transformational leadership, transactional leadership, and servant leadership.
The role of organizational culture in SKPD performance: Research should investigate the role of organizational culture in SKPD performance, including the impact of culture on job satisfaction, motivation, and turnover intentions.
The impact of external factors on SKPD performance: Research should investigate the impact of external factors, such as economic conditions, political instability, and natural disasters, on SKPD performance.

References

Brewer, G. A., & Hayes, L. A. (2000). The impact of budgeting on public sector performance. Public Administration Review, 60(3), 254-265.

Eisenberger, R., Huntington, R., Hutchison, S., & Sowa, D. (1986). Perceived organizational support. Journal of Applied Psychology, 71(3), 500-507.

Graddy, E. P., & Chen, C. (2006). Budgeting and performance in the public sector. Public Administration Review, 66(3), 444-455.

Meyer, J. P., & Allen, N. J. (1991). A three-component conceptualization of organizational commitment. Human Resource Management Review, 1(1), 61-89.

Q: What is the main objective of this study?

A: The main objective of this study is to investigate the effect of participation in the preparation of the budget and organizational commitment on the performance of the Regional Work Unit (SKPD) in the North Sumatra Provincial Government.

Q: What is participation in the preparation of the budget?

A: Participation in the preparation of the budget refers to the active involvement of stakeholders, including SKPD members, in the budget preparation process. This approach is based on the principle of accountability and transparency, which is essential in ensuring that public funds are used effectively and efficiently.

Q: What is organizational commitment?

A: Organizational commitment refers to the degree to which employees are committed to their organization and its goals. It is a critical factor in determining the performance of public sector organizations, as it affects the motivation, job satisfaction, and turnover intentions of employees.

Q: What are the findings of this study?

A: The findings of this study indicate that participation in the preparation of the budget has a positive influence on SKPD performance partially. This means that when SKPD members are involved in the budget preparation process, they will feel more responsible for the budget, and this will have a positive impact on their performance in carrying out governmental tasks. Conversely, organizational commitment does not have a significant effect on the performance of the SKPD in North Sumatra Province.

Q: What are the implications of this study?

A: The implications of this study are that participation in the preparation of the budget is a critical factor in determining the performance of the SKPD. Therefore, managers and leaders in the government environment should prioritize budget participation as a key strategy for improving SKPD performance.

Q: What are the limitations of this study?

A: This study has several limitations that should be noted. Firstly, the study was conducted in a specific context, namely the North Sumatra Provincial Government. Therefore, the findings may not be generalizable to other contexts. Secondly, the study relied on self-reported data from SKPD members, which may be subject to biases and errors. Finally, the study did not control for other factors that may influence SKPD performance, such as leadership style, organizational culture, and external factors.

Q: What are the future research directions?

A: This study provides a foundation for further research on the factors that influence government performance. Future research should investigate the following:

The impact of leadership style on SKPD performance: Research should investigate the impact of leadership style on SKPD performance, including the role of transformational leadership, transactional leadership, and servant leadership.
The role of organizational culture in SKPD performance: Research should investigate the role of organizational culture in SKPD performance, including the impact of culture on job satisfaction, motivation, and turnover intentions.
The impact of external factors on SKPD performance: Research should investigate the impact of external factors, such as economic conditions, political instability, and natural disasters, on SKPD performance.

Q: What are the practical recommendations for improving SKPD performance?

A: Based on the findings of this study, the following practical recommendations are made:

Encourage active participation in budget preparation: Managers and leaders in the government environment should encourage active participation in budget preparation among SKPD members.
Develop a participatory budgeting system: The government should develop a participatory budgeting system that involves SKPD members in the budget preparation process.
Monitor and evaluate budget participation: The government should monitor and evaluate budget participation among SKPD members.
Provide training and development programs: The government should provide training and development programs for SKPD members to enhance their skills and knowledge in budget preparation and management.

Q: What are the potential applications of this study?

A: The potential applications of this study are:

Improving SKPD performance: The findings of this study can be used to improve SKPD performance by prioritizing budget participation and developing a participatory budgeting system.
Enhancing organizational commitment: The study can also be used to enhance organizational commitment among SKPD members by providing training and development programs.
Informing policy decisions: The study can inform policy decisions related to budgeting and performance management in the government environment.

Q: What are the potential limitations of applying the findings of this study?

A: The potential limitations of applying the findings of this study are:

Contextual limitations: The study was conducted in a specific context, namely the North Sumatra Provincial Government. Therefore, the findings may not be generalizable to other contexts.
Methodological limitations: The study relied on self-reported data from SKPD members, which may be subject to biases and errors.
Theoretical limitations: The study did not control for other factors that may influence SKPD performance, such as leadership style, organizational culture, and external factors.