Abstract:With the purpose of improving management effectiveness of departments by changing existing management models or methods, functional management innovation, often happening in the complicated middle level of organizations, needs to not only coordinate the relationship with both the top level and the first line employees, but also set up new links with various horizontal functional departments. As a result, the realization of functional management innovation represents a complicated systematical fitting process. This paper adopts the case of budget management model innovation of Zhejiang Mobile for case study to explore the systematical fitting mechanism of functional management innovation, so as to find out the key to realizing this type of management innovation.