Essays on Reasons for Investigating the Role of Strategic Management Accounting in Organizations Coursework

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The paper "Reasons for Investigating the Role of Strategic Management Accounting in Organizations" is an outstanding example of management coursework.   Previous research studying the SMA role has laid focus on the accounting techniques applied and their underlying circumstances. Tillman and Goddard’ s research pays attention to the perception and use of SMA. The authors investigate the role of SMA in an organizational setting to obtain a deep comprehension of the matter, which is lived and observed by players in organisations. The topic of the role of SMA seeks to add to the new comprehension by giving comprehensions from a Germany-based transnational firm.

In investigating the role of SMA, the authors begin by defining SMA broadly as the application of management accounts models in reinforcing tactical resolutions. The authors investigate SMA as an important function that determines companies’ survival in the current highly competitive international global markets. Thus, the authors consider SMA as important as it allows organizations to assess strategic situations successfully. The researchers endeavour to comprehend the meaning of SMA to organisational players. Past research by Scapans and Bromuwich (2001) document that the studies written about ten years ago on the subject of ‘ Management Accounts’ show the complexities of the works in practice, which stem from the simple approaches of economic decision-making.

These authors further note that many studies seek to find out the organisational background of management accounting, thus opening the debate of the objective of the organization in accounting management. In this light, Tillman and Goddard (2008) try to address the objective of management accounting in organizations by examining different complexities facing the subject within organizations. Whereas past studies in SMA has focused on the used accounting techniques and the prevalent circumstances, Tillman and Goddard (2008) pay more attention to the perception and practice of SMA.

As a result, the authors seek to understand from the perspective of contributors the manner that accounting is applied is making sense during complex strategic decisions alongside the particular techniques used. The attainment of sensemaking, varied information set in accounting is applied depending on the decision’ s setting. In their study of the role of SMA, Tillman and Goddard (2008) hope that by attaining a better comprehension of the use of accounting information within a strategic context, more valuable systems of accounting may be developed.

Consequently, the authors provide comprehension by investigating sense-making and the way management accounting aids the process. Important Discussions Studied by Tillman and Goddard in the Preceding Literature The important discussions by the authors in the previous research span SMA and organizational logic making. Strategic Accounting Management: The latest years have interested many researchers in the issue of SMA. The interest has been inspired by originally emphasising on normative studies, which has trailed research that is additionally empirical.

Main normative additions to SMA usually recommend templates for SMA practices comprising competitive position monitoring and competitor accounting, strategic cost management (Porter, 1985), strategic investment appraisal and developments on modern accounting with tactical constituents including activity-grounded costing and the balanced scorecard. Even though the normative work has contributed to SMA, it has some drawbacks because it is usually disconnected from what often occurs in organisations. Several SMA practice surveys have been conducted (Guilding & Cravens, 2001; Guilding et al. , 2000). The surveys have documented that strategic pricing and competitor accounting are commonly used techniques.

However, some surveys consider the SMA term is not extensively applied in firms, and the implication is not usually open to leaders. Different scholars have used a contingency framework methodology in examining SMA (Abernethy, 1999). Moreover, this study has led to the comprehension of the subject but has been affected by the common contingency theory shortcomings in the choice of variables and requirement, incomprehensive sample selection and the production of conflicting results (Chenhall & Langfield, 1998). These studies, however, failed to shed light about the implementation of SMA practices and offer no theoretical description of such practices.

Several SMA case examples have been conducted to offer some valuable insights into practices of SMA. According to Rickwood (1990), investigations imply that the accounting’ s role obtains, both information about the external setting of the operations of a firm comprising the plans and performance of competitors. Lord (1996) refers to a case example done to demonstrate that the practices of SMA systems could be found in firms. However, the facts might not be quantifiable in accounting numbers.

Moreover, they might not be gathered and applied by accounts managers. However, the case study is widely expressive and gives minimum of theoretic information.

References

Abernethy, M. A., & Brownell, P. (1999). The role of budgets in organizations facing strategic change: an exploratory study. Accounting, organizations and society, 24(3), 189-204.

Boland Jr, R. J. (1993). Sense-making of accounting data as a technique of organizational diagnosis. Management science, 30(7), 868-882.

Chenhall, R. H., & Langfield-Smith, K. (1998). The relationship between strategic priorities, management techniques and management accounting: an empirical investigation using a systems approach. Accounting, Organizations and Society, 23(3), 243-264.

Guilding, C., 1999. Competitor-focused accounting: an explanatory note. Account. Organ. Soc. 24 (7), 583–595.

Guilding, C., Cravens, K.S., Tayles, M., 2000. An international comparison of strategic management accounting practices. Management Accounting Resource, 11 (1), 113–135.

Hasan, H., & Gould, E. (2001). Support for the sense-making activity of managers. Decision Support Systems, 31(1), 71-86.

Lord, B.R., 1996. Strategic management accounting: the emperor’s new clothes? Management. Accounting Res. 7 (3), 347–366.

Parker, L. D., & Roffey, B. H. (1997). Methodological themes: back to the drawing board: revisiting grounded theory and the everyday accountant's and manager's reality. Accounting, Auditing & Accountability Journal, 10(2), 212-247.

Porter, M. E. (1985). Competitive Advantages: Creating and Sustaining Superior Performance. New York: The Free Press

Rickwood, C. P., Coates, J. B., & Stacey, R. J. (1990). Stapylton: strategic management accounting to gain competitive advantage. Management Accounting Research, 1(1), 37-49.

Scapens, R. W., & Bromwich, M. (2001). Editorial Report—Management Accounting Research: the first decade. Management Accounting Research, 12(2), 245-254.

Strauss, A., Corbin, J., 1990. Basics of Qualitative Research—Grounded Theory Procedures and Techniques. California: SAGE Publications.

Tillmann, K., & Goddard, A. (2008). Strategic management accounting and sense-making in a multinational company. Management Accounting Research, 19(1), 80-102.

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