Question

In the last quarter of the fiscal year, a divisional manager chose to delay budgeted preventive maintenance expenditures so that the budgeted income goals could be achieved. Is this an example of goal congruent behavior or dysfunctional behavior?

Answer 1

Delaying budgeted preventive maintenance to meet income goals is an example of dysfunctional behavior rather than goal congruent behavior, as it can cause long-term harm to the company.

Step-by-step explanation:

When a divisional manager delays budgeted preventive maintenance expenditures to achieve budgeted income goals, it constitutes dysfunctional behavior. Although such an action may help meet short-term financial objectives, it is likely to lead to more significant problems in the long term, such as equipment failure, increased maintenance costs, and potential operational downtime. This decision is not goal congruent because it does not align with the overall health and sustainability of the company and may undermine long-term success.

A budget is a calculation plan, usually but not always financial, for a defined period, often one year or a month. A budget may include anticipated sales volumes and revenues, resource quantities including time, costs and expenses, environmental impacts such as greenhouse gas emissions, other impacts, assets, liabilities and cash flows. Companies, governments, families, and other organizations use budgets to express strategic plans of activities in measurable terms