Budgetary Performance Feedback and the Power of Doctor-Managers’ Perceptions

The reform processes affecting Public Healthcare Organizations (PHOs) have significantly changed the tasks and responsibilities of physicians heading Operational Units (OUs), making them “doctor-managers”. This hybridization makes them vulnerable to role ambiguity, with possible dysfunctional effects on their behaviors and managerial performance. The enhancement of psychological factors in budgeting practices may help to reconcile their new managerial role with the traditional clinical professional domain. Rooted in psychology-based budgeting research, this study aims to shed light on the perceptual role of Budgetary Performance Feedback (BPF) to avoid undesired psychological outcomes. It examines the influence of BPF on doctor-managers’ Perceived Organizational Support (POS) and their satisfaction with the budget holder role. It also investigates the mediating effect of POS in the BPF-role satisfaction connection. The empirical analysis was conducted by administering questionnaires to a sample of doctor-managers of Italian PHOs. A linear regression model was performed to test the hypotheses. Findings show that BPF perceptions positively influence POS and satisfaction with the budget holder role; further, POS fully mediates the BPF-role satisfaction link. The study adds to the limited healthcare empirical research on the individual-level benefits of performance information, by providing evidence of how the underexplored perceptions of BPF can positively impact doctor-managers’ attitudes towards the managerial role. This paper highlights how PHOs can mitigate doctor-managers’ role ambiguity risks by developing budgeting practices that pay attention to psychological factors linked to their functioning and the development of POS to the managerial role.