The effect of budgetary participation, difficulty level and organizational culture on the performance of government officials

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International Journal of Mechanical Engineering and Technology (IJMET)

Volume 10, Issue 03, March 2019, pp. 1172-1179. Article ID: IJMET_10_03_119

Available online at http://www.iaeme.com/ijmet/issues.asp?JType=IJMET&VType=10&IType=3

ISSN Print: 0976-6340 and ISSN Online: 0976-6359

THE EFFECT OF BUDGETARY

PARTICIPATION, DIFFICULTY LEVEL AND

ORGANIZATIONAL CULTURE ON THE

PERFORMANCE OF GOVERNMENT

OFFICIALS

Paulus Peka Hayon and Mohamad Ilham

Accounting Department, Faculty of Economics and Business, Universitas Musamus,

Merauke, Indonesia

ABSTRACT

The performance of government officials is a reflection of the progress of a region.

The success of the performance of the regional government is interesting to note

because the regional government is an extension of the central government that runs

the government that has direct contact with the community in its area. This study aims

to determine the effect of budgeting participation, budget difficulty, and organizational

culture on the performance of government officials. This type of research is quantitative

research. The population in this study was government officials in the Tanah Miring

District of Merauke Regency. Sampling using the purpose sampling method that is

sampling with certain considerations. The data in this study were processed using SPSS

21 tools. The results of this study indicate that participation in budgeting had a

significant effect on the performance of government officials, while the level of difficulty

of the budget and organizational culture did not affect the performance of government

officials.

Keywords: Budgeting participation, Budget difficulties, Organizational culture,

Government official’s performance

Cite this Article Paulus Peka Hayon and Mohamad Ilham, the Effect of Budgetary

Participation, Difficulty Level and Organizational Culture on the Performance of

Government Officials, International Journal of Mechanical Engineering and

Technology, 10(3), 2019, pp. 1172-1178.

http://www.iaeme.com/IJMET/issues.asp?JType=IJMET&VType=10&IType=3

1. INTRODUCTION

The policy of regional autonomy is basically directed at encouraging increased capacity of local

governments in providing services to the public more effectively and efficiently. The closeness

of government organizations at the regional level is expected to be better able to accept the

The Effect of Budgetary Participation, Difficulty Level and Organizational Culture on the

Performance of Government Officials

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people's real aspirations about what services are needed. Therefore, it is hoped that there will

be input obtained in the framework of development planning so that there is no gap between

the government development plans, both programs and budgets and the real needs of the

community (Silmilian, 2013).

As a public sector organization, local governments are required to have a performance that

is oriented to the interests of the community, and encourage the government to always be

responsive to its environmental guidance, by striving to provide the best services in a

transparent and quality manner and clear division of tasks to the government (Wulandari, 2013)

. Improving the performance of the public sector in this case the local government apparatus is

a comprehensive matter where the district and urban village as users of the budget will produce

different levels of performance according to their abilities and sense of responsibility.

According to Wahyudi (2005) in Wulandari (2013), argues that the performance of public

sector organizations in this case local government apparatus is the end result (output) of

organizations that are in accordance with organizational goals, transparent in accountability,

efficient in accordance with the wishes of users of information services, vision and the

organization's mission, quality, fair and organized using adequate facilities and infrastructure.

In general, performance (performance) is an illustration of the level of achievement of the

implementation of an activity / program / policy in realizing the goals, objectives, mission and

vision of the organization contained in the planning strategy of an organization (Mashum, at.all,

2006). Performance is often also used to refer to the achievement or success rate of individuals

and groups of individuals towards the achievement of targets that have been prepared

previously with certain criteria and indicators. Without any goals or targets, then the

achievements that are not obtained cannot be said to be performance because there is no

benchmark for the achievements that have been made so that the targets and benchmarks of the

expected outcomes are important in the performance appraisal process.

According to Fahmi (2011), argues that one way to see the progress of a performance in

one organization is to make an assessment of the organization. Assessments can be made to

employees and managers. The grading system is used the method that is considered to be most

appropriate to the form of the organization, because the misuse of the method will make the

assessment made unable to give the intended answer.

Maximum achievement of performance is influenced by various factors, including the

involvement of the organization in budgeting, the extent to which the level of budgetary

difficulties is structured and how the organization's culture in carrying out their respective

duties and obligations, organizational commitment, accounting control, reporting systems and

much more other factors.

According to Mashun at.all (2006), argues that the budget is a statement about the estimated

performance that will be achieved by an organization in a certain period expressed in monetary

terms. In public sector organizations the budget is an instrument of accountability for the

management of public funds and the implementation of programs financed with public money.

Budgeting in public sector organizations is an important activity because it is related to the

process of determining allocations and for each program and activity.

In the process of public sector budgeting, it starts from the budget preparation stage, the

budget ratification stage, and the budget implementation stage and the budget reporting and

evaluation stages (Purwanugaha at.al, 2012). The current development regarding budgeting is

done by approaching participation between superiors and subordinates. Budgeting with this

participation allows negotiations between managers as superiors and employees as

subordinates. Budgeting participation is a process where there is cooperation from all parties in

making decisions related to the budget that influence the activities of the organization in the

Paulus Peka Hayon and Mohamad Ilham

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future. Budgeting participation is a managerial approach that generally can improve managerial

performance. According to Adianto (2008), states that over the past four decades budgetary

participation and its influence on managerial performance have attracted the interest of several

researchers to conduct further research (Argyris 1952, Milani 1975, Kenis 1979, Brownell

1981, Brownell and Mclnnes 1986, Indriantoro 1993, Supomo 1998, Ardianto, 2008). Many

studies pay attention to the issue of budget participation, this is because participation is

considered to have consequences for the attitudes and behavior of organizational members

(Sinuraya 2009). Two reasons for this study are interesting because: 1) Participation is assessed

as a managerial approach that can improve organizational performance, 2) various studies that

examine the association between participation and outcome performance are conflicting

(Bronell, 1981).

The results of research conducted by Brownell (1982) and Brownell and McInness (1986)

show that there is a positive and significant relationship between budgetary participation and

the performance of the film manager (2013), with the results of the study finding that budgetary

participation has a positive effect on apparatus performance government.

In the budgeting process to produce a budget that is ready to be implemented so that it is

not too difficult for budget users. Not too difficult which means here is that it can be reached in

its implementation so that the prepared budget can be applied according to the budget and

according to the calendar set. According to Budiati (2005), states that the budgeting process is

relatively more difficult in uncertain environmental conditions because future events are

difficult to predict. This is related to the behavior of managers. The results of Hopwood's (1972)

study that manager behavior if judged based on the budget will have a negative impact, while

Otley (1978) suggests that managerial behavior if judged based on the budget will have a

positive impact.

The public demand for government performance lately is increasingly felt. The government

is required to provide services to the public that are timely, responsible and so on. The

government has also tried to meet these public demands. But not one hundred percent of the

public's demands have been fulfilled. This is thought to be influenced by organizational culture.

Fahmi (2011), that culture is the work of human creativity that is produced and has been used

as a part of the order of everyday life. A culture that is used and applied in life over a long

period of time will influence the pattern of formation of a society, such as the habit of diligent

work. This habit has an effect on the long term, namely the spirit of diligent work that must

occur until old age, and vice versa. Organizational culture is a habit that has lasted a long time

and is used and applied in the life of work activities as one of the drivers to improve the quality

of work of employees and company managers. Mustikawati's research (1999) shows that the

interaction of participation in budgeting with paternalistic culture has a significant influence on

improving managerial performance.

Based on the background of the problems described above, the researchers want to review

how the influence of budgetary participation, the level of difficulty of the budget, organizational

culture on the performance of the apparatus of the Tanah Miring District. Where currently the

Tanah Miring District is a district with several villages divided into two groups, namely local

villages and advanced villages.

2. METHODOLOGY

This research is a quantitative research that examines the relationship of several independent

variables on the dependent variable. The population in this study was the local government

apparatus in this case the apparatus in the office of the Tanah Miring District of Merauke

Regency. Sampling using the purpose sampling method that is sampling with certain

considerations (Sugiyono, 2014). The samples in this study were district heads, district

The Effect of Budgetary Participation, Difficulty Level and Organizational Culture on the

Performance of Government Officials

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secretaries, district treasurers, and village officials (village heads, village treasurers, village

secretaries) in the Tanah Miring District neighborhood, and all staff involved in the budgeting

process. The type of data in this study are primary data obtained through questionnaires

distributed with as many as 39 questionnaires. Data processed in this study using SPSS 21.0.

The research model is as follows (Figure 1).

Figure 1. Research model

Research Hypothesis:

H1: Budgeting participation (X1) has a significant positive effect on Government Apparatus

Performance (Y).

H2: The level of budget difficulties (X2) has a significant positive effect on Government

Apparatus Performance (Y).

H3: Organizational culture (X3) has a significant positive effect on the performance of

government apparatus (Y).

Variable measurement:

X1: Participation in budgeting uses 5 indicators, namely, involvement of subordinates,

opportunities given to subordinates, information provided, superiors involving subordinates,

superiors asking for opinions of subordinates, contributions of subordinates.

X2: The level of budget difficulties using indicators, namely problems in implementation,

can be achieved, sincerity in achieving them, expertise and knowledge.

X3: Organizational culture is measured using 4 indicators, namely compliance with

regulations, clarity of purpose, work is private property and nepotism.

Y: The performance of government officials is measured using indicators on this variable,

namely planning, investigation, coordination, evaluation, supervision, staff selection and

representation.

4. RESULTS

4.1. Data Quality Test

Before the data is processed, the data quality test is done first, the data quality test in this study

uses validity test and reliability test.

a. Validity test

A questionnaire is said to be valid if the question in the questionnaire is able to reveal what

will be measured by the questionnaire (Ghozali, 2011). Testing this validity uses the Pearson

correlation approach. If the correlation between scores of each question with a total score has a

significant level below 0.05 then the question item is said to be valid, and vice versa. Based on

the results of data processing, it is known that all items in this study were declared valid.

b. Reliability test

Paulus Peka Hayon and Mohamad Ilham

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According to Ghozali (2011) Reliability test is a tool to measure a questionnaire which is

an indicator of a variable or construct. A questionnaire is said to be reliable or reliable if the

respondent's answers are consistently stable over time. To test this reliability produces a

cronbach alpha value. A variable is said to be reliable if it gives an alpha cronbach value> 0.69.

Based on the results of data processing, it is known that all variables in this study are declared

reliable.

4.2. Regression Analysis Results

After testing the quality of the data regression analysis was carried out. The results of the

regression analysis in this study are presented in the following table 1.

The results of multiple regression analysis obtained from the results of calculations through

SPSS can be seen in Table 1. From the table we can see that the constant value is 8,333, the

regression coefficient value X1 is 0,816, X2 regression coefficient value is -0,201 and X3

regression coefficient of 0.023 so that the equation is obtained:

Y= 8.833+ 0.816X1 +-0.201X2 +0.023X3

Table 1. Multiple Regression Analysis

Coefficientsa

Model

Unstandardized Coefficients

Standardized

Coefficients

Sig.

Std. Error

Beta

(Constant)

8.833

3.606

2.450

.019

.816

.186

.773

4.387

.000

-.201

.257

-.116

-.780

.440

.023

.094

.037

.247

.806

From the above equation it is known that the constant value is 8,833, which means that

when budgetary participation, budget difficulty, and organizational culture are zero, the

performance value of the government apparatus is 8,833.

Table 2. Summary of Hypothesis Testing Results

Hypothesis

Coefficient

t-count

Sig.

Remark

H1 : X1 → Y

0,816

4,387

0,000

Significant positive

H2 : X2 → Y

-0,201

-0,780

0,440

Not Significant negative

H3 : X3 → Y

0,023

0,247

0,806

Not Significant positive

5. DISCUSSION

5.1. Effects of Budgetary Participation

The results of data analysis are known that t-count obtained for 4.387 greater than the value of

t-table with a significant level of 0.000, where this value is smaller than the significant level of

5%. In accordance with the basis of decision making, it can be concluded that partially

participation in budgeting has a significant effect on the performance of government officials

or in other words that the first hypothesis is accepted.

The effect of budgetary participation, difficulty level and organizational culture on the performance of government officials

This study aims to determine the effect of budgeting participation, budget difficulty, and organizational culture on the performance of government officials.

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