The result of the study designed to extend the research on budgetary participation beyond its traditional domain, the manufacturing industry, to the hotel industry, especially in Indonesia. The literature search indicates that research on budgetary participation in the past has mostly concentrated in manufacturing industry and ignored hotel industry in particular. This study examines the relationship between participation and department managers' performance in Indonesian Hotel industry taking into consideration the impact of a favourable superior-subordinate. This research investigated the relationship between budgetary participation and the 'overall dimension of managerial performance and also the different sub-dimensions (aspects) of managerial performance.
The data for the study were collected from the managers in charge of front-office, HRD, Accounting and Finance, housekeeper, F&B, engineering, and IT department in hotels. These managers were selected from 16 hotels and located in a particular region of Central Java (Yogyakarta and Solo). The results are based on data collected from 40 department managers working in the hotels.
The results reveal that there is no interaction between department managers' Budgetary Participation and their Superior-Subordinate Relationship affecting their overall performance in the hotel industry. A further analysis of the data reveals that there is a significant and positive relationship between the BP-SSR interaction and the department managers' negotiation and investigation sub-dimension (aspect) of the managers' overall performance.