Aerospace Industries and the Budgeting Function

by Howard Carlisle



As the aerospace industry represents the industry with the most prevalent need for change, it is evident that this is where many of the future advances in management systems such as budgeting will be generated. However, it should be remembered that trends will be, to a large degree, determined by the government. Any shift in emphasis by the government will result in response by industry. Just as the recent U.S. Department of Defense emphasis on reducing costs through incentive contracts has prompted industry to improve the effectiveness of its budget and cost control functions, so any future change in governmental, requirements will serve as the stimulus for defense firms to adjust their management systems in order to remain successful in the highly competitive environment which exists. It is apparent that future budget systems for aerospace must meet flexibility requirements and must be program-oriented in order to be meaningful under the dynamic conditions which the space projects impose. Developing management systems aimed at accommodating these conditions provides the challenge which must be met. Just as this presents the heart of the problem, a glimpse of the answer can be seen by examining the human needs and developments required. This involves the type of training and orientation which the participants in these activities must receive. In order to effectively operate under these conditions, the individuals involved must have a well-rounded appreciation of both the administrative and technical problems. This requires, to a degree, an integration of these disciplines.

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