Strategic Management Accounting and Business Strategy: A Loose Coupling?

Journal of Accounting & Organizational Change, Vol. 6, No. 2, 2010

Posted: 16 Oct 2009 Last revised: 24 Nov 2009

See all articles by Lino Cinquini

Lino Cinquini

Scuola Superiore Sant'Anna- Institute of Management

Andrea Tenucci

Scuola Superiore Sant'Anna

Date Written: June 15, 2007

Abstract

Purpose - The purpose of this paper is to investigate whether business strategy influences strategic management accounting (SMA) usage.

Business strategy has been operationalized through strategic pattern, mission and positioning. Design/methodology/approach - The study is based on an internet questionnaire survey of Italian companies. Multiple regression analysis is used to test the impact of strategic variables (pattern, mission and positioning) on SMA usage. Company size is included as control variable.

Findings - Several SMA techniques appear to be used in Italian companies as they are in other countries investigated in different studies. Customer Accounting, Competitive Position Monitoring, Competitor performance appraisal based on published financial statement and Quality Costing represent the most widely used SMA techniques in the Italian sample. From the regression analysis, both defender-type and cost leader-type of strategy are found to be more willing to use SMA techniques addressing cost information.

Research limitations/implications - The issue, common in contingent research, of business strategy definition and operationalization constitutes the main limitation of the paper; in an attempt to restrict its effect, we use three strategic typologies (pattern, mission and positioning) and employ a measurement method used in previous studies. A second issue concerns the definition of SMA techniques. There is no concurred list of SMA techniques in the literature and further discussion is expected in the future.

Originality/value - Firstly, empirical evidence is provided to a field (SMA) where empirical research is needed in order to be comparable with traditional management accounting techniques. Secondly, for the first time in SMA studies, a framework is employed that considers all of the three main strategic variables (pattern, mission and positioning) used in management accounting literature. As a result, the loose coupling between SMA techniques and business strategy typologies indicates (with the possible exception of cost related SMA techniques) that the same SMA technique can support different strategic approaches of the company.

Keywords: Strategic Management Accounting, strategy

JEL Classification: M41

Suggested Citation

Cinquini, Lino and Tenucci, Andrea, Strategic Management Accounting and Business Strategy: A Loose Coupling? (June 15, 2007). Journal of Accounting & Organizational Change, Vol. 6, No. 2, 2010, Available at SSRN: https://ssrn.com/abstract=1012881

Lino Cinquini

Scuola Superiore Sant'Anna- Institute of Management ( email )

Piazza Martiri della Libertà, 24
Pisa, 56124
Italy
+39 050 883969 (Phone)
+39 050 883936 (Fax)

HOME PAGE: http://www.idm.sssup.it/cinquini/

Andrea Tenucci (Contact Author)

Scuola Superiore Sant'Anna ( email )

Piazza Martiri della Liberta, n. 33
Pisa, 56127
Italy

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