Why might rolling budgets demotivate employees?

Rolling budgets can demotivate employees primarily because of the extended time spent on budgeting processes. When a company utilizes rolling budgets, it often requires regular updates and revisions, which means that employees may have to invest significant amounts of time in preparing budgets, analyzing variances, and adjusting forecasts on a continual basis. This frequent involvement can lead to feelings of frustration and fatigue as employees might feel overwhelmed by the constant need for revisions instead of focusing on their primary job responsibilities.

Additionally, this ongoing attention to budgeting can detract from time available for strategic tasks or operational activities, further impacting morale as employees may feel their productivity is being compromised. The pressure to regularly justify budget allocations and compare them to actual performance can create a stressful environment, diminishing overall job satisfaction and engagement within the team.

While the other options hint at factors that could relate to employee motivation, they don't adequately capture the disruptive nature of the continuous budgeting cycle that is characteristic of rolling budgets. Options related to reduced responsibilities or compensation do not accurately reflect the realities of the budgeting process and its impact on employee motivation.