However, despite the focus on aggre

However, despite the focus on aggregated targets, Food Corp maintained a traditional budget report, which was distributed to its executive management and the board of directors. In that report, the actual profit and loss statement (P&L)was still compared to the budget, and explanations of variances were included. The difference between the old bottom-up method of budgeting and the top-down target setting was explained by an executive director:

When you follow up on budget variances in the traditional budget world [you] say: “This was my budget and here are my variance explanations […] so now you can explain”.

However, this was different in the new system:

We are employed in order to reach our targets despite that the exchange rate to the USD is 5.37, and they are to take corrective actions when necessary. This is the major difference.

And further on:

Now we tell you: “This is fine, we listen to you but it does not change your goal”.

Thus, the target was fixed and could only be changed in extreme situations. The executive director explained:

Results (Indonesian) 2:

Namun, meskipun fokus pada target agregat, Makanan Corp dipertahankan laporan anggaran tradisional, yang dibagikan kepada manajemen eksekutif dan dewan direksi. Dalam laporan itu, laba rugi aktual (P & L) masih dibandingkan dengan anggaran, dan penjelasan dari varians dimasukkan. Perbedaan antara metode bottom-up lama penganggaran dan pengaturan sasaran top-down dijelaskan oleh direktur eksekutif: Ketika Anda menindaklanjuti anggaran varians dalam dunia anggaran tradisional [Anda] berkata: "Ini adalah anggaran saya dan di sini adalah . saya penjelasan varians [...] jadi sekarang Anda bisa menjelaskan "Namun, ini berbeda dalam sistem baru: Kami bekerja untuk mencapai target kami meskipun bahwa nilai tukar USD adalah 5,37, dan mereka mengambil tindakan korektif bila diperlukan. Ini adalah perbedaan utama. Dan lebih jauh: Sekarang kita memberitahu Anda: "Ini baik-baik saja, kami mendengarkan Anda tetapi tidak mengubah tujuan Anda". Dengan demikian, target itu tetap dan hanya bisa berubah dalam situasi yang ekstrim. Direktur eksekutif menjelaskan: