In May 2023, Liisa Rahe defended her Master’s thesis on The Impact of Digitalization on Engagement in Budgeting Process (using the example of VeeRa) at the Estonian University of Life Sciences, receiving an A grade and graduating from the university cum laude. Liisa has previously worked at the Tax and Customs Board, the State Shared Service Centre and in the private sector. In April 2023, Liisa joined the VeeRa team.

The purpose of the thesis was to determine the impact of digitalization on engagement in the budgeting process in Estonian local governments. To this end, the following research objectives were set:

  • to define the budgeting process based on theoretical literature and determine its main benefits;
  • to provide an overview of different approaches to engagement and use it as a basis for highlighting the main components thereof;
  • to determine the possible impact of digitalization on engagement based on previous research;
  • to analyse the impact of digitalization on engagement in the budgeting process of Estonian local governments.

Budgeting is considered to be one of the most important management tools (Lidia 2014; Collier, Berry 2002), however in previous studies, budgeting has also been criticized for the complexity and time-consuming nature of the budgeting process (Lidia 2014; Bergmann jt 2020), as well as the limited engagement of those involved (Rautiainen jt 2022). According to Bergmann et al. (2020), the success of budgeting is linked to the satisfaction of the employees responsible for the budgets, therefore it is necessary to find ways to increase engagement and satisfaction. Digitalization of budgeting could be beneficial in increasing engagement. The aim of the master’s thesis is to determine how digitalization has impacted engagement in budgeting in Estonian local governments. To achieve this, a survey was conducted among financial and subunit managers in local governments who use the VeeRa budgeting software. 92 budgeting software users participated in the survey and the statistical analysis method was used to analyze the results obtained. The participants in the study consider budgeting an important management tool. The analysis results showed that digitalization has helped to increase engagement by increasing satisfaction with task performance and information sharing in the budgeting process. From the perspective of job satisfaction, digitalization has made the budgeting process more convenient and faster, and has enabled data to be processed, analyzed, and tracked more easily. From the perspective of information sharing, digitalization has helped to share information more quickly and easily and has allowed managers to obtain more information for improved decision-making.

Link to master’s thesis: