Features of introducing budgeting for different models of innovation processes: a framework review

• Published in: Problems and perspectives in management Vol. 18; no. 3; pp. 338 - 349
• Main Authors: Cherep, Alla, Gerasymova, Vitaliya, Gorbunova, Anna, Shcheblykina, Inna
• Format: Journal Article
• Language: English
• Published: Sumy Business Perspectives Ltd 02-10-2020; LLC "CPC "Business Perspectives
• Subjects: budget; Budgeting; business unit; Corporate finance; development; Efficiency; Financial management; flexibility; innovation; Innovations
• ISSN: 1727-7051; 1810-5467
• DOI: 10.21511/ppm.18(3).2020.28

Innovation processes are vehicles of growth and, therefore, require effective management systems. These circumstances raise the question of how a particular innovation process model influences the features of budgeting implementation at the enterprise. The article aims to figure out the main provisions, which profoundly impact using budgeting for particular innovation process models. Methodologically, this article reviews theoretical approaches and practical basis on innovation process models and peculiarities of using budgeting in this area. Authoritative sources on these issues and the search covering 43 years were observed. This study was also based upon the secondary research data provided by international institutions, such as consulting companies, which help to reveal theoretical foundations and extensive experience in using budgeting practices on innovative companies around the world. Thus, the following statements were identified: an interconnection between the innovation process model and the creation of business units that become budgeting points; specific innovation process models require stage-based budgeting; particular innovation process models demand greater budgeting flexibility. Investigation of these statements led to the discovery: innovation processes models, which require being closed within business units and others that can demand to be more separated; models that are more in need of milestone budgeting; nature of influence flexibility on the efficiency of innovation. The demonstrated findings on features of using budgeting for particular innovation process models can help executives reconsider the existing systems to increase its efficiency.