Theses and Dissertations (Management Accounting)
- Adelowotan, Michael Olajide(2014-05-19)It is generally acknowledged that human capital intangibles are major value drivers in the new economy characterised by information and technology. The main purpose of this study is to examine the extent to which companies ...
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Diane Laure Arjaliès | Julia Mundy
Little is known about the role of management control systems (MCS) in managing the strategic processes that underpin Corporate Social Responsibility (CSR). To enhance our understanding of this phenomenon, this study employs Simons' (1995) levers of control framework to explore how organizations leverage MCS in different ways in order to drive strategic renewal and trigger organizational change while simultaneously supporting society's broader sustainability agenda. Drawing on data gathered from France's largest listed companies - members of the CAC 40 - we provide insights into the structures and processes that companies employ to design, implement and monitor their CSR strategy. In doing so, we provide evidence of the way that organizations seek to attain their CSR objectives, and of the relationship between the management of CSR and other business processes. Of particular interest is the role of the levers of control in enabling managers to identify and manage threats and opportunities associated with CSR strategy, thus forming risk management processes that support organizations in their attainment of strategic objectives. Furthermore, the study provides evidence suggesting the use of MCS has the potential to contribute to society's broader sustainability agenda through processes that enable innovation, communication, reporting, and the identification of threats and opportunities. © 2013 Elsevier Ltd.
Roland F. Speklé | Frank H.M. Verbeeten
We study the use of performance measurement systems in the public sector. We hypothesize that the way in which these systems are being used affects organizational performance, and that these performance effects depend on contractibility. Contractibility encompasses clarity of goals, the ability to select undistorted performance metrics, and the degree to which managers know and control the transformation process. We expect that public sector organizations that use their performance measurement systems in ways that match the characteristics of their activities outperform those that fail to achieve such fit. We test our hypotheses using survey data from 101 public sector organizations. Our findings indicate that contractibility moderates the relationship between the incentive-oriented use of the performance measurement system and performance. Using the performance measurement system for incentive purposes negatively influences organizational performance, but this effect is less severe when contractibility is high. We also find that an exploratory use of the performance measurement system tends to enhance performance; this positive effect is independent of the level of contractibility. The effectiveness of the introduction of performance measurement systems in public sector organizations thus depends both on contractibility and on how the system is being used by managers. These findings have important implications, both for practice and for public policy. © 2013 Elsevier Ltd.
Steven A. Melnyk | Umit Bititci | Ken Platts | Jutta Tobias | Bjørn Andersen
Performance measurement and management (PMM) is a management and research paradox. On one hand, it provides management with many critical, useful, and needed functions. Yet, there is evidence that it can adversely affect performance. This paper attempts to resolve this paradox by focusing on the issue of "fit". That is, in today's dynamic and turbulent environment, changes in either the business environment or the business strategy can lead to the need for new or revised measures and metrics. Yet, if these measures and metrics are either not revised or incorrectly revised, then we can encounter situations where what the firm wants to achieve (as communicated by its strategy) and what the firm measures and rewards are not synchronised with each other (i.e., there is a lack of "fit"). This situation can adversely affect the ability of the firm to compete. The issue of fit is explored using a three phase Delphi approach. Initially intended to resolve this first paradox, the Delphi study identified another paradox - one in which the researchers found that in a dynamic environment, firms do revise their strategies, yet, often the PMM system is not changed. To resolve this second paradox, the paper proposes a new framework - one that shows that under certain conditions, the observed metrics "lag" is not only explainable but also desirable. The findings suggest a need to recast the accepted relationship between strategy and PMM system and the output included the Performance Alignment Matrix that had utility for managers. © 2013 .
Michelle Rodrigue | Michel Magnan | Emilio Boulianne
This paper explores how managers perceive stakeholders' influence for the choice of internal environmental performance indicators (EPI) that underlie strategic performance measurement systems. Drawing on the concept of levers of control, we conduct a field investigation within a large multinational firm operating in an environmentally sensitive industry. The firm pursues a proactive environmental strategy driven by a willingness to achieve corporate economic success while taking environmental issues into consideration. Our investigation encompasses interviews with key environmental executives and a review of corporate documents. We show that EPI are used as interactive and diagnostic controls, with stakeholders' influences being integrated into the corporation through its beliefs system. We find that four distinct influence patterns emerge. These influence patterns range from being narrow and unidirectional to very broad and interactive, conditional upon the firm's environmental impact on specific stakeholders, and its need for legitimization. The study extends research on the relationships between stakeholders and corporate environmental management and reveals ways in which strategic performance measurement systems integrate environmental considerations. © 2013 Elsevier Ltd.
Sophie Pondeville | Valérie Swaen | Yves De Rongé
This study examines the role of contextual and strategic factors in the development of environmental management control systems in manufacturing companies. In particular, the authors test the roles of perceived ecological environmental uncertainty, perceived stakeholder pressures, and the degree of corporate environmental proactivity on the development of environmental management control systems. The main results from a survey of 256 manufacturing companies suggest that companies that perceive greater ecological environmental uncertainty are less inclined to develop a proactive environmental strategy, environmental information system, or formal environmental management control system. Market, community, and organizational stakeholders motivate environmental proactivity, as well as the development of different environmental management control systems. Regulatory stakeholders only encourage the development of an environmental information system. © 2013 Elsevier Ltd.
Massimo Contrafatto | John Burns
Consistent with calls for in-depth studies of social and environmental accounting and reporting (SEAR) intervention (Bebbington, 2007; Fraser, 2012; Contrafatto, 2012), our paper focuses on the interrelationship between organisational change and SEAR practices, as well as the involvement of management accounting in such organisational dynamics. Drawing insight from both Laughlin (1991) and Burns and Scapens' (2000) theoretical frameworks, we explore the processes of change through which SEAR practices become elevated to strategising status, in the context of broader organisational and extra-organisational developments, but we also illuminate how institutionalised assumptions of profit-seeking limit the extent to which broader sustainability concerns become infused into day-to-day business practice. Our paper highlights the importance of management accounting in facilitating and shaping the cumulative path of SEAR practices (and sustainability more generally); however, we also heed caution against uncritical reliance upon conventional management accounting tools. The following paper extends our understanding of SEAR practices as cumulative process over time, an awareness of the potential limits to such developments in profit-seeking organisations, and stresses a need to be circumspect when involving management accounting. © 2013 Elsevier Ltd.
Lukas Goretzki | Erik Strauss | Jürgen Weber
The paper theorises how a new actor of a firm can drive the institutionalisation of a new role for management accountants. Drawing on institutional theory and using insights from a single case study in a German manufacturing firm, the paper analyses the institutionalisation of the so-called " business partner" role for management accountants, which was promoted and driven by the case firm's newcomer CFO. The paper focuses on the micro-processes and especially the institutional work carried out b y the new CFO that supported the entrenchment of the " business partner' role within the case firm. In this light, we illustrate that especially three interrelated kinds of institutional work were carried out within the case firm to support the institutionalisation of the management accountants' new role: (1) legitimising the new " business partner" role, (2) (re-)constructing the management accountants' role identities and (3) linking the intra-organisational level with an institutional environment in which external actors aim to achieve changes in the management accountants' role on a broader societal level. In this context, the paper also provides insights into the specific German management accounting context. Overall, the findings suggest that the institutionalisation of a new role for management accountants can be understood as the product of purposive actions carried out by actors to support a specific institutional arrangement within the firm. © 2013 Elsevier Ltd.
Lies Bouten | Sophie Hoozée
This paper investigates how environmental reporting (ER) and environment-related management accounting (EMA) practices may interact in the process of responding to disturbances of the natural environment (e.g., changes in environmental regulation, green consumerism, societal pressures for environmentally-responsible conduct). Based on data gathered in four Belgian case companies, we find that the emergence of an interplay between ER and EMA practices is related to the change pathways followed by these disturbances. Moreover, the strength of the environmental disturbances, top management commitment and the presence of an environmental champion are important contingent factors in understanding the development of a recursive r elationship. Finally, the findings illustrate that an interplay between ER and EMA practices has the potential to foster or stifle organizational greening. © 2013 Elsevier Ltd.
Jan Bebbington | Ian Thomson
Michael Burkert | Rainer Lueg
This paper responds to recent calls for studying the diffusion of management practices beyond classifying companies as adopters and non-adopters (Ansari et al., 2010; Lounsbury, 2008). In particular, we examine how characteristics of CEOs and CFOs as well as perceived environmental uncertainty (PEU) of the top management team (TMT) affect the sophistication of Value-based Management (VBM) for which we develop a multi-dimensional construct.We base our analyses on a unique dataset that comprises archival data, interviews and survey data from top executives of German HDAX companies (58% response rate). The results of our Partial Least Squares (PLS) model (R 2 =55%) support most of our hypotheses and provide interesting findings.We find that the CFOs in our sample have substantially more influence on VBM-sophistication than CEOs. In particular, we document that cognitive styles (educational background in business) of CFOs have a substantial impact on VBM-sophistication. Moreover, short-tenured CFOs are associated with high VBM-sophistication. As expected, the related negative effect of long tenure on VBM sophistication is practically offset if the CFO has an educational background in business.Another relevant finding is that high perceived environmental uncertainty of the top management team is significantly associated with lower VBM-sophistication. The results of our control variables moreover reveal that systematic risk ('beta') leads to higher VBM sophistication. © 2012 Elsevier Ltd.
Tuija Virtanen | Mari Tuomaala | Emilia Pentti
Increased concern about sustainability issues has been voiced in the accounting literature. Although environmental performance is only one dimension of sustainability, it is nevertheless a key factor, especially in sectors such as the process industry, which consume substantial volumes of materials and energy. Energy itself is important because its production is a major cause of carbon emissions. Hence efforts to reduce its use are important, and here energy efficiency measurement and management play a key role. Although the conceptual chal lenges posed by energy efficiency measurement are well known in the technical literature, there has been little discussion of energy efficiency management. This paper examines the complexities involved in the measurement and management of energy efficiency. In particular, it examines how these complexities impede effective use of management control systems to impact the ability and motivation of employees to work toward the goals of sustainable development. The study is a cross-disciplinary one, and combines technical energy efficiency research and environmental management accounting research in performance management. The study provides practical knowledge of what happens in organizations pursuing sustainable development, in this case environmental performance. The paper demonstrates a performance indicator that does not allow proper energy efficiency performance management because it is still technically underdeveloped. Setting targets for the indicator is especially problematic. © 2013 Elsevier Ltd.
Frank Figge | Tobias Hahn
Eco-efficiency is oftentimes considered the gold standard for managerial decision making in an environmental context because it seemingly reconciles the efficient use of capital and the efficient use of environmental resources. We challenge this view by disaggregating eco-efficiency to provide an in-depth analysis of corporate eco-efficiency and to identify the drivers of an efficient use of environmental resources. By building on the value-based approach in financial management, we extend the rationale of economic value drivers to develop drivers for the efficient use of environmental resources. We apply this logic to analyze the carbon-efficiency of major car manufacturers worldwide. The analysis clarifies the conceptual relationship between the use of economic and environmental resources by firms. The analysis shows that the drivers of capital efficiency and eco-efficiency are not fully congruent. These findings underpin critical voices that question the supposedly unproblematic link between corporate eco-efficiency and economic value creation. We illustrate that the efficient use of environmental resources is complementary rather than instrumental to capital efficiency. Consequently, the challenge of managing eco-efficiency is to unshackle it from the current capital-oriented domination. The findings provide managerial guidance on the value-creating use of environmental and economic resources. Conceptually, our argument contributes to the debate between critical and managerial perspectives on environmental accounting and helps to address the current standoff between these two camps. © 2013 Elsevier Ltd.
Kim Soin | Paul Collier
Recent world events, most notably the global financial crisis, have refocused and intensified interest on risk and the nature of systems that operate to manage risk. One area that has received relatively little attention is the interrelation between risk, risk management and management accounting and control practices. This editorial provides an introduction to the special issue of the journal on "Risk and Risk Management in Management Accounting and Control". It argues that risk and the way it is managed has become a feature of organizational life in both the public and private sectors. By changing organizational practices risk management can facilitate and legitimise certain ways of organizing. It has the potential to change lines of responsibility and accountability in organizations, representing a particular way of governing individuals and activities. The argument is further made that risk management has moved away from being an issue of narrow concern to finance (value at risk, derivatives, etc.) or accountants (financial statement disclosure, etc.) to an issue about management control and therefore a key area in which management accountants need to engage. This editorial also highlights the potential side-effects of risk management, including issues around trust and accountability, but also the focus on secondary or defensive risk management and the rise of reputation risk. © 2013.
Mika Ylinen | Benita Gullkvist
This study investigates the indirect effects of mechanistic and organic types of control on project performance acting through innovativeness in exploratory and exploitative innovation projects. It also examines the interaction effect of these controls on performance. The research model is empirically tested with survey data from 119 projects in various project organizations, using Partial Least Squares (PLS) with controls for the size of the project and task uncertainty. The results illustrate that organic control, acting through innovativeness on project performance is an important form of control in exploratory innovations, and also enhances performance in exploitative innovations. In addition, the results indicate that the interaction effect of organic and mechanistic control types enhances performance in both exploratory and exploitative innovation projects, suggesting a complementary effect. The findings are discussed in relation to theory and their managerial implications. © 2013 Elsevier Ltd.
Pietro Micheli | Luca Mari
This paper builds on principles and techniques developed in measurement science, as currently understood in physical sciences and engineering, to improve the theory and practice of performance measurement. To do so, it firstly discusses three fundamental positions on measurement, characterized as metaphysical, anti-metaphysical and relativistic. Subsequently, it lays the foundations of a pragmatic epistemology of measurement in both physical and social sciences. Finally, these insights are integrated through the examination of possible advances in both the theory and practice of performance measurement in organizations. © 2013 Elsevier Ltd.
Henri C. Dekker | Junya Sakaguchi | Takaharu Kawai
As a consequence of the development of intensified relations with suppliers, for many firms the supply chain has become a significant source of risk exposure. In this paper we examine firms' use of control practices to manage risks associated with intensified collaboration with supply chain partners. Specifically, we examine how buyers manage risks associated with interfirm transactions through their choice of supply partner, in terms of perceived goodwill and competence trust, and their use of multiple interrelated supply chain management (SCM) control practices. These control practices include contractual contingency planning, performance target setting, operational reviews, information sharing, supplier support and joint problem solving. We collect survey data from Japanese manufacturing firms about their relations with part suppliers to test hypotheses about the associations between transaction risks, selection of trusted suppliers and use of SCM practices. Our results support that transaction characteristics that are at the basis of transaction risks significantly affect the selection of trusted partners to collaborate with as well as their use of various control practices to manage relationships. We also find that in particular competence trust facilitates the use of control practices to support effective SCM. © 2013 Elsevier Ltd.
David S. Bedford | Teemu Malmi
© 2015 Elsevier Ltd. There is growing interest in how management controls operate together as a package of interrelated mechanisms. Although theoretical debate dates back to the seminal paper of Otley (1980), there remains little empirical analysis of how control mechanisms combine. To increase knowledge in this area this study explores how multiple accounting and other control mechanisms commonly combine and the associations these combinations have with firm context. From a cross-sectional sample of 400 firms, this study presents an empirically derived taxonomy of five control configurations used by top managers, labelled as simple, results, action, devolved, and hybrid. Many of these patterns closely resemble control configurations common to the literature, while others represent distinctively contemporary arrangements, such as flexible variants of traditional bureaucracy (action), and instances where multiple and seemingly conflicting control types intermesh (hybrid). In analyzing these configurations this study provides accounting and control researchers with empirical observations to refine and extend existing control frameworks and theory.
Silvia Jordan | Lene Jørgensen | Hermann Mitterhofer
In this paper, we analyze the relationship between management control and risk management by investigating the use of risk maps in an inter-organizational project collaboration in the Norwegian petroleum industry. The various ways in which risk maps are drawn upon in the course of the project reveal sources of perceived 'usefulness' that are not primarily to do with increased attention toward early warning signals and the defensive production of audit trails, as suggested by previous research. Rather, the study shows how risk maps act as mediating instruments which allow distributed actors to adjudicate interests, build confidence in and associate with 'the project' and its progress over time. Drawing on social studies of science and technology, the study shows how the graphical representations of risk maps manage to engage the user and act as mediating platforms where 'performances' around the notion of risk can happen. The paper thus extends and complements existing explanations of the pervasiveness of enterprise risk management technology and discusses its interrelation with project management and inter-organizational controls. More broadly, the paper illustrates how the government of risk is related to mediating instruments and how such mediation happens in the interplay between text and conversation. © 2013 Elsevier Ltd.
In recent years, much has been written on the nature of management accounting change, and indeed stability. Many researchers have used concepts such as rules and routines to interpret this change and/or stability. Recent research has provided an increasingly clear picture of what rules and routines are, as well as contributing to our understanding of the processes of change and stability in management accounting. Management accounting research has mainly presented rules and routines as related phenomena, but some conceptual work has suggested they are separable and can (and possibly should) be considered independently when studying processes of change/stability within management accounting. However, empirical support for such work has been scarce to date. This paper uses data from the archival records of the Guinness company in an effort to establish whether rules and routines, at least in management accounting research, are best considered separable concepts or not. The archival records are artefacts of rules and routines and thus can be used to trace the interactions of rules and routines over time. Support for the notion that rules and routines should be considered separately is presented. The findings also portray the stable, but changing, nature of management accounting routines over time; a point worthy of further research. © 2013 Elsevier Ltd.
Anatoli Bourmistrov | Katarina Kaarbøe