This is an advantage of top-down budgeting. Frequently, departmental managers have blinders on and are unaware of what is happening in other areas of the company. Senior management has a better perspective of the big picture and what will be necessary to achieve overall organizational objectives.
This is an advantage of top-town budgeting. When the budget is dictated from above, departmental managers do not need to spend time putting together their plans and ideas for the future. Furthermore, there is no need for lower level managers to make adjustments to the first draft of the budget, as is done with bottom up budgeting after senior management has examined the first draft budgets of the lower level managers. The result is that less time is required for the budgeting process.
This is an advantage of top-town budgeting. Strategic plans are long-term in nature and require a good deal or coordination in order to be successful. Senior management's job is to position each division and department appropriately to fulfill their role in the long term organizational plan. Top-down budgeting achieves this more readily than bottom-up budgeting, because senior management has the required long-term perspective and lower level managers do not.
This is not an advantage of top-down budgeting, although it is a true statement. When senior management determines the budget without input from the departments being held to that budget, employees are less likely to feel they can / want to achieve the target. It wasn't their idea and no one listened to them.
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