eaa paper: managers and accounting
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Managers and accounting:
Learning experiences, organizational development and personal competence building
Paper in progress. Draft version.
Please do not quote without permission of the author
ABSTRACT
This paper´s intention is to examine management accounting from its most important user´s perspective: practicing managers´. The research is motivated by perpetual and essential urge to understand the essence of accounting in the context of managerial work. The article takes a three-folded approach. First, a deeper understanding to the issue is sought based on learning experiences and reflections of practicing managers. Second view is built around practicing managers´ views and visions about organizational development. Third perspective addresses managers’ objectives on a personal competence building level.
The empirical foundations of this research are in the experiences, opinions, reflections and visions of practicing managers, described by themselves in qualitative narrative texts. Contribution of this article emerges by conceptualizing the working executive´s managerial mindsets and understandings about accounting. The results of this research form a framework about practicing manager´s understanding of accounting that emphasizes the multidimensional nature of managerial work, especially as a practical science about value creation in organizations.
Table of Contents
1 INTRODUCTION .................................................................................................................................... 3
1.1 Bringing managers back into management accounting research ................................................. 3
1.2 Managerial work ........................................................................................................................... 7
1.3 Perspectives of this paper ............................................................................................................. 9
2 RESEARCH METHODS AND DATA ....................................................................................................... 11
2.1 Research methodology ............................................................................................................... 11
2.2 Research data .............................................................................................................................. 14
2.3 Data analysis ............................................................................................................................... 16
3 RESULTS .............................................................................................................................................. 19
3.1 Learning experiences .................................................................................................................. 19
3.2 Organizational development ...................................................................................................... 22
3.3 Personal competence building.................................................................................................... 23
3.4 Managers and accounting, elaborating a framework ................................................................. 25
4 DISCUSSION ........................................................................................................................................ 30
References ............................................................................................................................................ 33
”What is the true accounting competence of a manager? I think the answer is
crowdsourcing. Leader can only succeed together with others, with
cooperation. This culture of working together allows questions, uncertainty and
success. (Director)
1 INTRODUCTION
1.1 Bringing managers back into management accounting research
If we consider management accounting being concerned about the provisions and use of
accounting information by managers within organizations, it should be an essential urge for
us to continually build an in-depth understanding about accounting in the very context of
managerial work. How do the practicing managers perceive the essence of accounting
embedded in their mindsets and managerial actions? What does such production and usage of
accounting information look like that leads to actions which have effects on the ways in
which organizations and individuals work? What is the role and functioning of management
accounting in practice in managerial work like when organizations are trying to succeed in
the global economy? This paper is written in the context of questions like these, as it
recognizes the lack of knowledge around these issues and seeks to illustrate new perspectives
by placing managers and managerial work in focus.
Looking at it from the managerial work point of view, management accounting is a practical
science about value creation in organizations. Accounting is an integral vehicle in attention
direction as well as problem solving, providing managers with the basis to make informed
business decisions. Nevertheless, management accounting is often approached from the
perspective of accounting professionals and doctrines. Even when discussing about strategic
management accounting, big emphasis can be on the management accounting profession, its
tools and systems, challenges, changing roles related to the management of the organizations
etc. This research takes a different approach. Intention is to explore accounting as part of
managerial work from practicing managers’ perspective, not from accounting professionals´.
As the paper´s title puts it, the focus is on managers and accounting.
The previously described assertion about managerial work´s importance corresponds with
several existing recognized voices in the field of management accounting research. There
have been a number of discussions and demands to support this kind of perspective in
management accounting research. Jönsson (1998) wrote about management accounting
research being out of focus and lacking empirical input from managerial work. More recently
Matthew Hall (2010) argued that despite Jönsson´s (1998) opening of the debate, research has
generated few studies that seek to really understand how managers engage with accounting
information in their work. Moreover, Hall (2010) states that research emphasis on decision
making in well-defined contexts is restrictive as it limits consideration of other ways of using
accounting information in managerial work. He calls for further research to examine how and
why managers use accounting information.
It has also been argued that management research in general should have more effect on
actual practice in organizations (Pfeffer 2007) and in order to do so to adopt methodologies
and theories that can be related to organizational reality (Seal 2012). Furthermore, some
researchers have stated that management accounting is perhaps too inward facing (Birnberg
2009) and accounting researchers sometimes choose to stay on the “safe side”, only trying to
understand practice instead of making suggestions on how to improve it (ter Bogt and van
Helden 2012).
Scapens (2006) draws together the changes which have taken place in management
accounting research since 1970s. He concludes that accounting research on the other hand has
during the decades provided clearer understanding about management accounting practices
but also that research has merely followed practice. The challenge according to Scapens is
still how accounting research can produce relevant insight for practitioners and to have more
of an impact on practice, instead of just following it. Also Hopwood (2007) has expressed his
concern regarding the lack of innovativeness in accounting research. One of the questions he
raises is that perhaps accounting could be seen and researched in its full diversity and
complexity if the research community would strengthen its links to the practitioners?
Hopwood also states that that accounting has become less isolated phenomenon in
organizations and it is more widely used by also many others than accounting professionals
(Hopwood 2007). This paper partly responds to these challenges by exploring the
understandings and needs of the practicing managers, “the customers of management
accounting”.
The aim of this research is to take a quite broad perspective to the issue of accounting and
managerial work. The focus of this research is not to concentrate solely on the use of
accounting information but to explore more comprehensively the relationship between
accounting issues, profitability and managerial work. A characterization from Wai Fong
Chua (2007) describes this paper´s research orientation quite conveniently. She states that
accounting is a practical activity. Yet we often choose to study it from a distance, through
surveys, mathematical formulae etc. She argues that one route to greater knowledge is to
rediscover accounting as contingent, a lived verb rather than abstract noun. This paper tries to
look at management accounting very closely through the working reality of practicing
managers. The contribution of this research is grounded in the qualitative narrative texts
written by practicing managers. The results frame a three-folded view into managers and
accounting, conceptualizing practicing managers´ experiences, views on organizational
development and personal competence building related to accounting. The results are
consistent with the view that management accounting research should bring the practical
reality of management more closely into focus, since the results indicate that it is not the
production and usage of numbers as such that the managers mainly reflect upon, but instead
the essence of accounting mindset and actions as part of managerial work.
On the other hand one has to recognize that there have already been shifts in focus in
management accounting research. Noteworthy is research that has been focusing on practice
(Ahrens and Chapman 2007, Skaelbaek and Tryggestad 2010, Wittington 2011) in such a
way that we can even talk about “a practice turn” in organizational studies, at least into some
extent. Management accounting researchers have also been adviced to take a more
participative role in organizational problem solving for example through constructive
research (Kasanen, Lukka and Siitonen 1993, Labro and Tuomela 2003 ) not to mention case
studies and action research approaches emphasizing the nature of the living reality in
organizations. When writing about practice theorizing Ahrens and Chapman (2007) state that
it is the possibilities of management control systems as a potential for action that should be in
focus, not only resistance and control.
Nevertheless, much is still to be researched and learned about managers and accounting.
Even if there is a recognizable drift towards a practice-based approach in management
accounting research, this drift will in any case only explain the dynamic relationship between
managers and accounting to a limited extent. Very few recent studies have taken the
practicing managers into focus more broadly. These papers have for example examined
managers´ perceptions of management accounting practices with a survey (Tayles, Pike and
Sofian 2007), illuminated manager´s attitudes towards the incompleteness of performance
indicators via a longitudinal field study (Jordan and Messner 2012) and analyzed a survey
about managers´ responses to the application of the controllability principle (Burkert, Fischer
and Schäffer 2011). In addition to these few studies there appears to be only case-based
research approaching the essence of accounting in context of managerial work. And in case-
research there is s usually more focused phenomenon or change process that is under
examination. These seem to be a worrying lack of research really pursuing in-depth
understanding about management accounting from the perspective of managers.
Empirical orientation of contemporary published accounting studies is one way of examining
the practice-focus of academic accounting thinking. Also theory plays a crucial role in
designing practice-oriented management accounting research. Malmi and Granlund (2009)
argue that current accounting theories and the role of those theories fail to provide valid
support for practitioners. And also according to Malmi and Granlund (2009) sometimes the
pre-adopted theory defines what is considered to be interesting in a research project. The
underlining concern is that accounting research has not succeeded in making contributions
relevant for the larger audience, especially for practitioners (Malmi and Granlund 2009,
Malmi 2005). This paper tries to avoid the risk of speaking only to other accounting
researchers. Instead of specific already well-established theoretical settings, the main
emphasis of this research is on the qualitative data collected from practitioners who are
experienced executives. That probably helps to avoid drifting far from the interest of
practitioners. However, we should recognize that practical relevance should be seen as a quite
broad concept, meaning more than merely the design, implementation and usage of
accounting and control technologies. In addition to this “instrumental relevance” concerning
the impact of selection and control of the chosen course of action, it can also be “conceptual
relevance” which has an impact on framing the decision making situation, or “legitimative
relevance” impacting the legitimizing and enforcing decisions (Van Der Meer-Kooistra and
Vosselman 2012). And overall, this paper aims not to argue that we should completely
replace less practice-relevant research; there is also room for research contributing mainly to
theory as argued by Pihlanto (2006).
Considering these respected voices (Ahrens and Chapman 2007, Jönsson 1998, Scapens
2006, Chua 2007, Hopwood 2007, Hall 2009, Malmi and Granlund 2009, Malmi 2005, Van
Der Meer-Kooistra and Vosselman 2012) in the management accounting research
community, the starting point of this paper seems well grounded. We need to enrich the
understanding about accounting from the perspective of managerial work. The starting point
of raising management accounting research relevance in the eyes of practitioners is to
develop more in-depth understanding about managers and accounting. As an accounting
researcher, it is also worth keeping in mind that accounting is only one of many activities in
an organization and is often considered only as a support function. Like Jorgensen and
Messner (2010) suggested, studying accounting where it intersects with other activities might
be likely to increase the interest of other disciplines in accounting research. In this paper,
such other type of activity is managerial work. This research seeks a more complete
understanding about management accounting from the perspective of managerial work.
1.2 Managerial work
When we pursue relevance in accounting research related to managerial work, involving only
the accounting professionals is insufficient. When choosing to research accounting from a
managerial work perspective managerial work itself becomes very interesting concept for us.
What is managerial work all about?
One of the most classic pieces of research about managerial work was done by Henry
Mintzberg. His groundbreaking work was based on observing what managers actually do in
their work. Instead of planning, organizing, coordinating and controlling, he found that
managers’ activities seemed to be characterized by brevity, variety and discontinuity.
(Mintzberg 1973, 1975). Also another significant piece of pioneering research about
managerial work by John P. Kotter (1982) who emphazised the incredible complexity of
executive roles. Kotter studied 15 successful general managers with multifunctional
responsibilities. According to Kotter managers constantly confront information uncertainty
and must rely on others in order to get things done. Both of these classic studies (Mintzberg
1973, Kotter 1982) about managerial work form an image where managerial work is seen as
an ongoing series of very complex interactional activities rich with verbal expressions and
meanings. The assumption about managerial work as being independent and filled with
information certainty through adequate management accounting information seems
questionable. So despite their evident role in modern management formal tools should not be
overemphasized either in management accounting context nor should human relationships be
seen too simplistically.
Since Mintzberg´s (1973) and Kotter´s (1982) classic studies a lot has changed in
management discourse. For example, more emphasis has been placed on leadership instead of
management. Also the evolution of the business environment (globalization, new technology
etc) has raised questions about whether it is necessary to update our understanding of
managerial work. Tengblad (2006) conducted a comparative study of top executives work in
order to reveal potential differencies to Mintzberg´s classic work. He found differences like
increase in workload, more interaction in groups, less administrative work and more
emphasis on giving information. On the other hand, many of the Mintzberg´s propositions
regarding management work still remained valid. Also Holmberg and Tyrstrup (2010) have
studied managerial work more recently. They underline as one key point that management is
far from knowing everything before doing anything. In their research involving 62 managers
they found that the major difficulty in handling manager´s everyday context was that “you
have to draw the map while orienteering”.
Overall, the scarce systematic empirical research about management practices offers a
motivational starting point for this research. It is noteworthy that existing research forms a
picture where management work is quite far from clear formalistic decision making and
controlling, and more characterized by a complex continuum of interactions. So it seems
fruitful to further investigate the nature of accounting as part of managerial work. Mintzberg
(1973), Kotter (1982), Tengblad (2006) and Tyrstrup (2010) plugged into essence of
managerial work. For management accounting researchers it is interesting and important to
explore the role and place of accounting issues in this context. Especially when it seems
reasonable to say based on our understanding about managerial work that management
accounting should play a quite diverse and multidimensional role. The skill and act of
managerial work should be seen as a systemic and continuous flow of actions that involve
interaction with various stakeholders, based on information from many sources, including
management accounting. This research seeks to shed a light on how practicing managers
perceive accounting. To deepen our understanding about the essence of accounting in the
context of managerial work, innovative and practice-oriented theoretical frameworks and
methodological approaches are needed. The following presents this paper´s research setting
and building blocks for gaining such insight.
1.3 Perspectives of this paper
This research approaches the topic of managers and accounting from three perspectives. First,
a deeper understanding to the issue is sought based on learning experiences of practicing
managers. In order to understand the relationship that practicing managers have with
accounting it is fruitful to explore via subjective reflections how that relationship has been
evolved. In the field of management accounting research there is a growing recognition of the
importance of understanding the living practice of management accounting (Jönsson 1998,
Hall 2010, Chua 2007, Malmi and Granlund 2009, Malmi 2005, Hopwood 2007) and
moreover, making an impact on it (Birnberg 2009, Bogt and Van Helden 2012, Scapens
2006, Van Der Meer-Kooistra and Vosselman 2012). The first perspective of this article
begins by examining what are the highlights from learning perspective when managers think
about accounting as a part of their work and professional practices? What are the situations
and contexts which experienced managers would like to emphasize when they are asked
describe moments of learning they have experienced related to management accounting
during their career?
The second perspective of this article is built around organizational development. This way
the research is geared towards understanding better what practicing managers expect and
need from management accounting in the context of their living organizational reality and
managerial work. With the organizational development dimension, this research seeks to
include an approach that can be firmly related to organizational reality (Pfeffer 2007,
Birnberg 2009). What the organizational development needs in the field of accounting, as
identified by practicing managers, tell us about the management accounting in its living
organizational context? The multi-dimensional nature of managerial work and organizational
reality described by various researchers (Mintzberg (1973), Kotter (1982), Tengblad (2006)
and Tyrstrup (2010) offer a starting point for this second perspective. This present research is
inspired by such contributions and the aim is to elaborate how management accounting could
be more connected to this managerial reality and have an effect to it.
This paper´s third perspective of managers and accounting addresses practicing managers’
personal competence building. Through insight in this area the aim is to better understand
accounting and its key areas from practicing managers’ point of view. What kind of things
the practicing managers see as their key development goals, not when it comes down to
reflecting upon their past or their organization´s needs, but thinking about themselves from
now on, as learners and acting individuals? What are the essential themes and areas of
accounting competence development for practicing managers?
These three approaches form a structure for guiding the data collection and analysis. They
can be considered as this research’s locales of interest, building blocks for further insight
about managers and accounting:
1. Learning experiences reflect how the relationship and understanding about
management accounting has evolved during managers´ careers
2. Organizational development paints a picture about present managerial needs for
accounting development
3. Personal competence building frames the essential competence development areas for
the future
This research is interested in managers understanding of the nature accounting as distinct
from accountants understanding of accounting. In spite of some recent published papers with
practicing managers in focus (Tayles, Pike and Sofian 2007, Jordan and Messner 2012,
Burkert, Fischer and Schäffer 2011) there seems to remain a worrying lack of knowledge of
managers and accounting. This paper seeks to partly fill this gap by constructing a more
comprehensive insight about managers and accounting, springing from the experiences and
visions of practicing managers themselves.
2 RESEARCH METHODS AND DATA
2.1 Research methodology
The insight and conclusions of this research are built in an inductive way. Rather than
beginning with a set of specific hypotheses, research is built on rich empirical data. This
methodological choice of operating almost in reverse fashion compared to traditional social
research is grounded on the interest of the research. The aim is to understand the objectives
and problems that managers face in their work related to management accounting, and how
they are trying and wish to solve these problems in their work. This field of practices,
symbolic structures, themes and patterns is broader than merely a traditional set of
management decision making situations. The idea of this research is not to isolate the “truth”,
but instead conceptualize at what is practicing managers´ understanding about accounting
practices and competencies like, how management accounting is used and formed in
organizational settings in practice. More than concentrating on the functionalist and practical
use of accounting tools, which Vaivio (2008) calls the “textbook view of accounting”, this
research is more concerned about the meanings and intentions of managerial actions
regarding accounting. This research can be characterized as an interpretative accounting
research since it seeks to understand the everyday practice of accounting by looking at the
actors´ (practicing managers) perceptions and definitions of the situation (Chua 1986). This
will be done by collecting qualitative data and looking it systematically. The data is described
in more detail in section 2.2 and the process of data analysis on section 2.3.
The methodological setting of this research is largely inspired by a grounded theory approach
(Glaser and Strauss, 1967). Grounded theory itself is not the most conventional methodology
in management accounting research, but it has been used (e.g. Tillman and Goddard 2008,
Goddard 2004, Norris 2002, Parker 2001) and furthermore, it is specifically suggested as a
methodology for management accounting research. Parker and Roffey (1997) see its potential
as contributing particularly to the interpretive research tradition and Elharidy, Nicholson and
Scapens (2008) have described the use of grounded theory in interpretative management
accounting research even further, providing practical guidelines for making quality grounded
theory research. One of this research’s starting points is the focus on managerial work and
practice. Since practice is also the basis for grounded theory it has the potential of reducing
the perceived gap between theories and practice (Lye, Perera and Rahman 2006). Another
premise of this research is the scarcity of existing research about accounting in the context of
managerial work. In the case of very few existing studies it is plausible to develop theoretical
constructs inductively from data. Thirdly, grounded theory as a methodology itself has most
potential regarding subjects with a strong human dimension (Goulding 1999), such as
managerial work. In its pursuit to gain insight in to the complexity of meanings, emerging the
experiences and visions of practitioners, this research draws many of its inspiration from
grounded theory. The aim is to let the conclusions emerge from empirical data rather than
from pre-existing theory.
Since the original publication The Discovery of Grounded Theory (Glaser and Strauss, 1967)
the way in which the methodology should be allied has diverged into Glaserian and
Straussian paradigms and more recently, also into constructivist grounded (Bryant and
Charmaz 2007) According to Elharidy et al (2008) accounting researchers have preferred the
Straus and Corbin´s (1990) version of the method even though von Alberti-Alhtaybat and Al-
Htaybat (2010) have argued for the Glaserian approach in interpretative accounting research.
Glaser´s approach to grounded theory is more open and general both in terms of defining the
research issue and area of study as well as the data analysis. Straus and Gorbin allow the
researcher to predefine research question and on the other hand opt for more structured steps
in analyzing data. The third school of grounded theory, the constructivist approach, orientates
more into Straus and Corbin view by starting with a more specific research question in mind,
getting into the literature earlier and “constructing” the theory from data instead of
“discovering” it (Evans 2013). Also some concerns have been raised about using the
grounded theory approach in management accounting research. Gurd (2008) who based on
his analytical review on research literature, states that sufficient justification to label research
as grounded theory research is sometimes missing. And even when the research itself fits into
grounded theory category, there are things related to the research design that can weaken the
credibility of the whole research. According to Parker and Roffey (2007) one of such pitfalls
is that grounded theory research should avoid prior commitment to any particular theory.
Because of this rather diverse variety of views on how to appropriately use grounded theory
or even design studies that draw some inspiration from grounded theory methodology, it is
essential to describe the research setting and process explicitly.
This research can be characterized as an interpretative qualitative research that has been using
data analysis developed in grounded theory. It is evident that no qualitative research project
starts out as “tabula rasa”, completely without any mental meanings based on the previous
experience of the researcher. Making these more or less evident conceptual starting points of
the research transparent is important for two purposes. First of all it helps to produce quality
research by making these assumptions clearer to the researcher himself. This is done in order
to avoid being ignorant and unreflective regarding philosophical, methodological and
theoretical underpinnings (Lukka 2010), especially when the research probably does not fall
into a mainstream accounting research category. Secondly being knowledgeable about the
implicitly adopted assumptions and values helps to assess the quality of the research. In
qualitative research the researcher`s own a priori assumptions and motivations may shape the
data collection and analysis. In the following, starting points of this kind related to this
research are identified and described.
One essential starting point and mental prior commitment of this research is the desire to
bring more empirical input from managerial work into the field management accounting
research. This “call to action” presented by previous researchers (For example Jönsson 1998,
Hall 2009, Malmi & Granlund 2009) has acted as a motivational starting point for this
research. Second inspirational starting point for the research project design is a preliminary
assumption that management work is much more complex and multidimensional than often
assumed. Also in the context of management accounting we need to step a bit away from the
traditional decision making emphasis into exploring the relevance of management accounting
practices from more dynamic perspective. It could mean for example that instead of just
being more informed with better numbers, management needs more comprehensive set of
methods and insight for to co-create the management accounting mindset and profitability
consciousness in the organization. Third starting point of this research is the researcher´s
background related to the research topic and empirical data. The researcher has professional
background in academic executive education, managing open enrollment Executive MBA
programs as well as tailored company-specific executive development projects. The design of
this research project has followed a suggestion for the researcher to self-reflect and define an
insightful research from his own personal interests (Chua 2011). In qualitative research an
ideal situation could be a researcher without too much preconceptions and ambitions, even
without any pre-knowledge about the theme of the research. Glaser has even argued that the
future of grounded theory is in the hands of a novice researcher who are still open to
“whatever” (Glaser 2009). In practice researchers always have some kind of prior knowledge.
So in this paper´s case, the researcher approaches the domain of the research not with an
empty head, but instead like Kelle (2005) quite appropriately phrases it, with an open mind.
The three-folded research setting presented in section 1.3 separates this research from the
purest form of grounded theory research. However, the tree-folded structure is selected to
operate as a lens into a world of managers and accounting, not to limit the emerging
conclusions. No conclusive theoretical framework has been chosen in advance in order to
fully explain the findings that the data generates. Since this research is not based on a single
case, but instead stems from experiences from tens of organizations, an a priori framework is
needed as a conceptual tool to guide the data collection in order to capture the essential view
about practicing managers and accounting issues. The research problem is quite general by
nature, defined as to explore accounting in the context of managerial work. What and why of
the research purpose is quite broadly defined by the researcher, but after that the data is
allowed to speak for itself.
2.2 Research data
The data consists of reflective narrative texts written by practicing managers. The aim is to
explore accounting in the context of managerial work, as described by these managers in their
writings. Due to this orientation, the discussion tends to orientate towards management
accounting. Even though other aspects of accounting (e.g. financial accounting) are not
explicitly excluded, the emphasis of the data is on management accounting perspectives, on
the provisions and use of accounting information within organizations, in the work of general
managers.
The respondents were students of the Executive MBA programme of the University of
Jyväskylä, Finland. MBA is a career development generalist degree for those with significant
relevant work experience that contributes to learning and in a case of an Executive MBA, this
is being even more pronounced. This is essential from this research’s perspective since the
rich previous experience of the respondents as well as their current managerial roles forms a
foundation for providing views about accounting in a living organisational context as part of
managerial work.
The group represented a very diverse collection of organizations. The 48 respondents came
from 40 different organizations. Some respondents worked in the same larger organization
but for example in different subsidiaries or units of the corporation, often located in different
sites geographically. If the number of organizations is counted including only totally distinct
organizations, without interpreting same corporation´s different subsidiaries or divisions as
different organizations, the amount of organizations represented is 35. The respondents
represent wide array of organizations, different sizes and from different field of industries
including also public sector. From research data point of view it has to also be noted that the
essays include experiences and views based on the respondents earlier working experience.
So the foundation of opinions and interpretations of this research are built based on many
organizational realities, exceeding the amount of different organizations that the respondents
were currently working for. The average age of the respondents was 42 years. They had
working experience from managerial positions on average 14 years. Almost everyone (46 out
of 48 respondents) had a term “director” or “manager” in their official working title. So the
respondents represent a group of people with significant relevant work experience and current
responsibilities in the field of management.
Table 1. Respondents
Amount of respondents 48
Male 34
Female 14
Age (average) 42 years
Managerial experience (average) 14 years
The briefing for the assignment to the respondents was two-fold. In the first stage the
researcher explained the background and motivation for the research to the respondents with
a presentation. The aim was to clarify the need for information of this research and emphasize
the assignment as an ambitious effort in order to understand better the multi-dimensional
relationship between accounting and managerial work. Respondents were informed also
about the pursuit to apply the essays in the University’s research activities by the researcher.
They were also given the opportunity to deny such further use of their writings. Nobody used
that option.
The respondents were given a template document including the basic briefing for the
assignment and an advice that the optimal length for the essay would be 3-6 pages of written
text. Most importantly the template included the following three-folded structure and
assignment for the essay.
1. Learning experiences
(Write about three top learning moments in your working history regarding
managerial work and accounting)
2. Organizational development
(Write about three ways on how to develop accounting in your organization from
managerial work perspective)
3. Personal competence building
(Write about three accounting competence development areas that would be
important for you personally from managerial work perspective)
The respondents wrote the 48 essays during their EMBA studies during the fall 2012. In order
to gain such amount of data, the essays were collected from two different EMBA student
cohorts. The other module´s students were quite in the beginning of their EMBA studies (27
essays) and the other group were roughly half way of their Executive MBA studies (21
essays). All the 48 essays were written by different people. The material combined was 214
pages of written text (4,5 pages per essay on average).
2.3 Data analysis
The data from two groups of respondents (27 and 21 essays) was first analyzed and
interpreted separately. Both sets of essays were analyzed through three phases. First the
essays were read without an attempt to identify themes or make conclusions. The idea was to
form the big picture about the data and only to make preliminary markings to the texts
pinpointing the highlights in the respondents’ stories.
In the second phase the essays were read again and observations were picked from the
individual essay texts and listed into three columns, each representing one of the key
perspectives of the research. At this point of data analysis all the findings from the essays (3
findings per perspective per essay as instructed in the essay briefing) were listed as code lists,
again without an effort to form themes or to leave anything out. In some essays the asked
three things in each perspective were clearly explicit and unambiguously marked even as
subtitles in the essays. In some texts the respondents described incidents or their plans more
broadly in a narrative format which left the researcher the task of carefully come up with an
interpretation and to attach appropriate labels into these stories.
There were certain things that made this second, “open coding” -phase of the analysis where
key concepts were identified from the data, a bit easier. First of all, the given structure for the
texts to highlight three issues made it easier to code the themes from the texts. The shifts in
content formed natural markers for themes since the essays were structured like that. These
“transitions” as Ryan and Bernard (2003) describe, were naturally used in order to identify
expressions. Also the fact that the respondents had time to reflect upon their experiences,
compared for example to an interview situation where they would have had a limited amount
of time to express themselves and to come up with the conclusions, produced quite refined
material. The texts were written in both the researcher´s and respondents’ native language
(finnish) and naturally that made it possible interpret also metaphors and subtle nuances from
the data.
In the third stage the data was very carefully looked in order to identify themes. What kind of
common denominators could be identified among the codes lists of three perspectives?
Versatile “cutting and sorting” (Ryan and Bernard 2003) technique used in this phase
involved arranging expressions into groups of things that went together. Eventually, a
preliminary classification started to emerge. The aim also this far was not to verify any given
theory, but instead allowing relevant theoretical constructs to emerge. The purpose of this
iterative process was to form an explanatory theoretical framework to illustrate each of the
three chosen perspectives of the research. The data analysis process was also iterative in a
sense that the essay sets were collected at different times during fall 2012. This enabled to
take some distance to the data before collecting and coding the next set.
After the first round of forming the themes from the code lists, the themes were quite
numerous. In each 3 perspectives there were 5-10 subcategories of themes. Those themes
were then refined and combined in order to illustrate 3-4 key themes in each category. The
preliminary results were then presented and discussed with the respondents in order to
understand the world of the respondents. Both sets of essays were analyzed first separately.
Then the data of the both sets of essays was combined in order to form one joint analysis that
would reflect all of the data as a whole. Though no significant differences were found in the
data between these two data sets, the data gathering in two sets increased flexibility and
iterativity into the data analysis. What started out as a practical thing (2 separate cohorts of
people was needed to form 48 respondents), turned out to be an important characteristic of
the research process. Proceeding in two phases made it possible to deepen the understanding
and meaning of the data also in two phases. Most importantly it forced to take some distance
in the data and doubled the analysis phases during the way towards final conclusions. Before
combining the data sets into final analysis, the preliminary formed themes from each data set
were also presented to the respondents also in order to pursuit consensual validation (Patton
2003) of the results. This is especially appropriate since one of the goals of the research
project was to identify themes that are recognized and used by the people whom are studied.
And more importantly, discussions with the respondents facilitated by the researchers after
presenting the results provided further insight and perspective into the data. That formed
good basis to combine the data sets and to enter the phase of forming the final results. With
both sets of essays also other researchers were involved in the analysis process. Opening up
the raw data (the original essays), formed code lists and preliminary interpretations of the
data to them was made in order to get additional views and insights to the process well before
entering the stage of combining the datasets and making the final analysis.
The last stage of the data analysis was to form the final analysis. This was done through
combining the code lists from both data sets and forming the themes all over again, but this
time based on the coding from both sets of essays. The codes were categorized into themes in
each three perspectives (learning experiences, organizational development, competence
building). And after that also the final summarizing theoretical conceptualization (outlined in
section 3.4.) about managers and accounting was made.
The literature review of this research was done in a way that tried to avoid the early closure
of the direction of the research. Before and during the data collection the literature was
reviewed only in order to motivate and position the research (see sections 1.1 and 1.2). The
vast majority of reading was done after collecting the data, at a point when emerging
theoretical interpretation of the data were already sufficiently developed. It can be said that
the data guided the literature review. The existing literature was used not to guide the
analysis, but instead in order to challenge and support the formed interpretations and to locate
the findings in the field of existing research.
3 RESULTS
3.1 Learning experiences
The first perspective of the data was to make the essence of accounting in everyday
managerial work explicit by reflecting upon the managers´ learning experiences. The data
was eventually categorized into following themes.
Picture 1
Themes of the learning experiences
An essential perspective that came apparent in the experiences of the respondents, was an
issue titled here as the “big picture”. Many respondents highlighted a period of time or
incident where they had really came to understand the big context of accounting and
management in their work. Quite often this related to realizing the overall operating frame of
their work in terms of money and value creation, really understanding the business model of
their organization at some point of their career. Or it was about being able to see the essential
parts of the organization through a “money mindset”, i.e. being able to place monetary values
on some crucial organizational activities. From a learning experience point of view, this
awakening to see the big picture of one’s own organization was a substantial thing.
However, this insight and personal understanding here called the “big picture” was
sometimes realized also through smaller projects. Many of the respondents raised smaller
things and incidents as important accounting learning highlights during their career. These
1
BIG
PICTURE
2
ACTIONS AND
EXPERIENCES
3
LIVING
PRACTISES
smaller projects meant for example being a project manager with a financial responsibility
regarding a specific project. Some of these “small project” experiences came even outside the
context of their main professional activities. For instance, an experience of acting in a leisure
organization in a role with financial responsibility had worked as a significant learning
experience resulting to become one of the highlights regarding accounting and managerial
work. Nonetheless, also these so called smaller projects can however be interpreted as
reflections about the same “big picture” phenomena. Many managers and executives work in
big complex organizations with complicated organizational structures and operating models.
When it comes to learning about management accounting, and especially realizing the cause
and effect of organizational functions in terms of money, smaller things are the ones that you
can more easily observe and realize. So without being an entrepreneur or being in charge of a
coherent organizational unit, learning about management accounting in action can come from
small projects where the living reality of management accounting is observable, from end to
end.
One of the most important highlight moments during my career regarding
management accounting was when I realized that accounting from management
point of view is like a decathlon. It is not enough to pay attention to one single
thing, but instead you have to understand that it is about the sum of all moving
parts” (Manager)
The second big theme based on the learning experience highlights is titled “actions and
experiences”. Whereas the “big picture” was about realizing the organizational context from
management accounting perspective, this other theme was about more concrete actions and
incidents. Whereas the “big picture” was about learning through seeing and realizing,
“Actions and experiences” stories were based on managerial interventions or initiatives
related to accounting and managerial work.
This theme of “actions and experiences” consisted of two kinds of stories, different from each
other. The first sub-category of this theme can be labeled as cost management. They were
descriptions about active and justified cost management, for example targeting unnecessary
costs in organization, finding out the optimal and most cost efficient way to do business etc.
Also demanding and challenging times occurred in these narratives. This is understandable in
a way that challenging times raise the importance of management accounting and especially
cost management in the general manager´s agenda. These were the moments where
management accounting and cost management actions were prioritized to be a bigger part of
practicing managers´ work.
However, “actions and experiences” stories weren´t only about hard times and cost
management. In fact, another angle rose from the data at least as clearly as cost management.
These stories are here to be called “investing for success” and they portray an important
image regarding practicing managers and accounting. The practicing managers´ views
concentrated on costs but also on building the capacity for making the future revenue. Stories
of practicing managers identify both flips of this coin of management accounting. Cost
management stories category in this paper´s analysis was more about single concrete actions
done on a shorter term, whereas investing on success experiences had more future-oriented,
longer term perspective.
“In personal life monthly income is almost fixed, so you quite rarely can increase
revenues or cut costs by making investments. This leads into thinking where most
economical way to deal different situations is to minimize costs. When I was
working in R&D I realized at some point that this is not the case in the context of
my professional work. Saving money from purchases and resources is often the
biggest waste of money”(Manager)
The third theme of learning experiences is titled as “living practices”. This wasn´t really
about numbers as such, but instead the interaction around them. These stories were about
communication and interaction, the ways in which accounting is made alive in organizations.
That is why the word “living” is especially meaningful in the category´s title. The practices
aspect on the other hand describes the as descriptions about continuing ways of dealing with
management accounting information. The “big picture” was more about sense making,
whereas living practices related more on sense giving, making numbers and accounting
insight become alive in organizations. Narratives regarding this dealt with themes like
creating a common language about accounting issues in the organization, good practices on
financial communication inside the company, ways in which management accounting
information was dealt in management team meetings etc
“Good management accounting is constant attention on financial issues. One-
time cost cutting campaigns are effective as such, but it tends to go like with the
weight-loss diets. Once the diet period is over, the kilos start crawling back.
(Director)
3.2 Organizational development
Whereas the previous perspective was about the learning experiences, the second approach
was after the insight that the managers had regarding their current organization and work.
The respondents’ views on how to develop accounting in theirs organizations can be
described through the following themes.
Picture 2
Themes of the organizational development
Essential potential in organizational development was seen through raising the “financial
consciousness” of the organization. There was an explicit need to increase the interaction
around financial information. Moreover, many narratives reflected a need to produce a more
profound understanding about profitability issues in an organization. On one hand many of
the respondents were after more transparent and unambiguous financial communication
inside the company. This would mean sharing more management accounting information
with the personnel and putting financial issues more firmly on the agenda on different
meetings. On the other hand, many of the suggested initiatives on “financial consciousness”
had more profound goals. Instead of just distributing already established information, there
was also a need of building more comprehensive financial mindset for managers, experts and
other personnel in the organization.
1
FINANCIAL
CONSCIOUSNESS
2
MANAGING WITH
A PROFITABILITY
MINDSET
3
GOOD
NUMBERS
4
CONTROLLER-
SHIP AND
ACCOUNTING
SYSTEMS
“My goal is that all the persons in my unit understand how their actions affect
our revenues and costs. I want to teach them financial thinking, because after
they learn that they are able to develop and guide their own actions by
themselves into a direction that affects our bottom line. (Director)
The second theme was “managing with a profitability mindset”. Whereas the previous theme
was a pursuit to increase the profit consciousness in the whole organization, “managing with
a profitability mindset” placed managerial actions into focus. This involved suggestions and
initiatives on how to intensify the profitability aspect in managerial work. The means related
to this were very diverse covering issues around focusing on the right things, designing
compensation systems and incentives, investing on certain activities, cutting unnecessary
costs etc. However it was noteworthy that largely these managing with profitability mindset
issues were future oriented and strategic by nature. There were some cost management
initiatives and aspects involved, but the main focus was on looking forward.
“Personally, I get the feeling of success when I can show that the implemented
actions, aimed to help us to reach our budget goals, are really effecting in
practice” (Director)
The third theme of organizational development was “good numbers”. There was a variety of
needs of producing relevant management accounting information in a form of different
analysis as well as different living practices on reporting and performance measurement. The
fourth theme was “controllership and accounting systems” which related to dealing with
accounting function within the organization. These development suggestions were connected
to both personal interaction (controllers) as well as the accounting systems. This fourth theme
wasn´t that pronounced but yet identifiable as a distinct theme in the data and quite practical
by nature.
3.3 Personal competence building
The third perspective of the essays was aimed to explore the key competencies of accounting
from managerial work point of view. It is intriguing to examine how practicing managers,
based on the real life career experience and managerial working positions they have, define
their most essential goals in management accounting learning. Picture 3 summarizes the
respondents views about the most relevant and actionable areas of competence development.
Picture 3
Themes of the Personal competence building
The first theme, sensemaking, was described in the data as the continuing need to see the big
financial picture of one´s organization’s operations. This demand to understand the
organizational logic through accounting was perhaps a bit surprisingly, very pronounced
regardless of the relatively long managerial experience (14 years on average) of the
respondents. There was a continuous pursuit to see the one’s own managerial context,
responsibilities and actions through financial lenses. And in this context, learning was
primarily seen as improving an individual’s thinking skills, as well as his/her personal and
organisational capabilities in becoming more astute in proceeding from plans to action.
”I see that manager´s accounting competence is a about overall understanding
about financial issues from botton up and from the top down. You should understand
which streams generate the business’s revenues and costs and how you can affect
those. Respectively, a manager should have an overall understanding about the
components of profitability of operations.” (Manager)
Where the sensemaking was mainly concentrated on looking at own organization and its
actions very closely, the second theme was one with a wider focus. This was more about the
ability to proactively understand the essential changes and effects relevant to one’s own
business. This theme is titled as “strategic financial foresight”. It was about reading macro-
economic trends and their potential impact, strategic agility and resilience, goal setting and
performance monitoring. Seeing what´s next is naturally a persistent desire for executives,
but in any case this “financial foresight” at strategic level was seen as an essential
competence development area.
1
SENSEMAKING
2
STRATEGIC
FINANCIAL
FORESIGHT
3
ACCOUNTING
KNOWLEDGE
4
SENSEGIVING
“What I hate the most are surprises. Surprises on your birthday or the pranks
made by kids are nice, but this business is our work that should be predictable”
Country (Manager)
The third theme of personal competence building was about “accounting knowledge”. This
finding is quite presumable, but nonetheless an important one. There was a need to learn
more about very basic fundamental accounting knowledge (interpretation of financial
statements etc) and also problem solving calculations (related for example to pricing,
customer profitability, comparison of different alternatives). The fourth theme of personal
competence development was “sensegiving”. These stories concentrated on how to bring
accounting and financial issues as part of working reality. How to present financial
information in a clear, inspiring and efficient way? There was also another crucial aspect
regarding sensegiving and competence building. How to get passionate about financial issues
personally? Strong positive feelings guide actions and strengthen the cognitive processes. If
you are really interested about something, you learn and actually perceive a richer image of
the issue.
“Based on my experience the increase in staff´s accounting competence lowers
the threshold between management and personnel when discussing about
financial issues. Working becomes more professional and you don´t have to make
financial decision only in a small group (for example management team).
Especially when the markets are low implementing cost cutting it is easier when
the personnel has learnt to read the financial signals the same way as the
management. The challenge about raising the competence level of the staff is in
the competence level of the manager himself. If you are uncertain about your own
knowhow on accounting, the threshold to teach others is too high. (Manager)
3.4 Managers and accounting, elaborating a framework
This paper´s aim is to seek more complete understanding about management accounting from
the perspective of managerial work. The following presents a framework summarizing the
practicing manager´s view on accounting. It pulls together the themes formed from the essay
texts and presents the “accounting word-view of a practicing manager” in four dimensions.
Picture 4 Managers and accounting
Big picture
It was the big picture that the respondents were after. The data indicates that in the minds of
practicing managers, this should be seen as an ongoing and even discursive process of
constructing and interpreting the organizations actions. is interesting from the perspective of
management accounting and organisations. It is not about taking for granted that
organisations work and things get forward as such, and then numbers are produced. In this
kind of simpler setting a manager would be merely reacting to the present reality, trying to
cope in different situations and trying to make sense of the numbers. However, what was
emphasized in this research´s data was also the continuing need to frame the big picture, to
see one self’s managerial area of responsibility and it´s development in terms of money.
The globalization of businesses and the accelerating pace of coming changes of the business
environment have increased the significance of competencies and practices related to this
field. This is noteworthy from the point of view of management accounting, which has
KNOWLEDGE BASE
ACCOUNTING
KNOWLEDGE
GOOD
NUMBERS
CONTROLLER-
SHIP AND
ACCOUNTING
SYSTEMS
BIG PICTURE
SENSE-
MAKING
STRATEGIC
FINANCIAL
FORESIGHT
BIG
PICTURE
ACTIONS
MANAGING WITH
A PROFITABILITY
MINDSET
ACTIONS AND
EXPERIENCES
MINDSET
SENSE-
GIVING
FINANCIAL
CONSCIOUSNESS
LIVING
PRACTISES
traditionally been mainly concentrated of producing relevant analysis based on the things
already happened. This research points to a way that practicing executive´s understanding of
this big picture includes not only dynamically reacting to present challenges presented in
terms of accounting information, but in addition to that calls for an accounting supported
approach with an anticipatory foresight. These results point to the way in which Neely and Al
Najjar (2006) and Hall (2011) emphasize in the context of performance measurement when
they talk about learning and mental model development in designing management accounting
practices. Such a need seems to exist in executive´s thinking.
Mindset
Another essential area was the pursuit to make management accounting alive in
organizations. Whereas the big picture was about manager´s own understanding about the
whole context of managing, organization and accounting, the dimension of “mindset” is
related to the whole organization´s understanding and practices of accounting. This need to
build financial consciousness and living practices can be also examined as an organizational
development and leadership initiative. There needs be a reason why experienced managers
see the potential in this. Building financial consciousness into the organization often means
quite big commitment in terms of time and effort. So why should you allocate resources into
this kind of activity? One reason seems to be founded on the tendency towards leadership
instead of management. More flexible and lower hierarchical organizations of today are
managed more through shared values, meanings and mindsets co-created in interaction
instead of rules and routines. Organizations are not only top-down, but instead there exists
more interactional need to jointly build the comprehension about the key aspect´s connected
to the organization’s financial performance.
Järvenpää (2007) writes that there is a challenge for management accounting to promote
strategic intent and commitment and organizational profit consciousness. This corresponds
with the findings of this paper. Many respondents’ narratives were around the question of
how could strategic management accounting be seen as a learning device? Not just giving the
right numerical answers but to build a profitability kind of strategic mindset at place. From
practicing manager´s point of view, the main challenge is not only on producing the right
numbers, but instead on how to incorporate the accounting information with organizational
activities and managerial practices in a most productive way.
This aspect of building the “organizational mindset” is also connected to the proposition
presented by Hall (2010) in which he claims that the relevance of accounting information is
determined by how managers use the information in verbal discussions. Jørgensen and
Messner (2010) also observed studying management accounting and strategizing that not
only the content of strategic ideas but the ways in which it is mobilized determines the
usefulness of management accounting information. Another study by Skærbæk (2010) also
emphasizes the role of accounting devices in a strategic setting. This sensegiving seems to be
wider issue rather than presenting the accounting knowledge as fixed and pre-determined.
Also the motivational aspect was mentioned in the essays, how to present the financial
information in an engaging way? Rowe, Shields and Birnberg (2012) call the social process
of making accounting information more persuasive “hardening soft accounting information”.
They approach the issue as games for planning an organizational change, but the issue is very
relevant also from this paper´s perspective. Sensegiving rose as an essential goal from the
managers to develop themselves to be more astute and convincing in financial
communications.
This really comes back to the issue presented by Jönsson (1998) about aligning management
accounting research to managerial work. He points out that one consequence of this kind of
research orientation would be focusing more on communication and assuming that
management accounting information comes to be used in various communicative contexts,
not directly in decision making models. Communication is more complex issue than sending
and receiving information as such, but instead it plays a crucial role in constructing social
practices. Management accounting information and how it is delivered and processed is at the
same time shaping and forming the organizational reality. Also Bryer´s (2011) concept which
sees accounting as learnt social practices through which individuals shape their
understandings connects to this discussion.
Knowledge base
I order to build and continually further develop the manager´s own understanding about the
big picture and the organizational mindset, a solid foundation is needed. Appropriate
production of relevant accounting information, sufficient management accounting
competencies of a manager, and a fluent business-focused cooperation with organization´s
accounting professionals organization form the “knowledge base” of accounting for a
practicing manager. This area is probably the one in which management accounting research
and accounting professionals are the most ready to contribute.
Actions
What management finally comes pretty much down to are actions. Manager´s understanding
about the big picture, organizations shared proper mindset and good numbers form still an
incomplete set without the relevant aspect of actions in managerial work. Respondents´
descriptions about different actions and experiences as well as the theme of managing with a
profitability mindset close the circle regarding this research´s aim on how to strengthen the
essence of accounting in managerial work. A practicing manager sees accounting not as a
separate thing but instead optimally as a cohesive part of acting as a manager.
The previous point is connected to a noteworthy angle to the issue by Chua. Chua (2007)
states that accounting in action approach not only might help us to identify what approaches
work, but also in addition that what “working” in a situated activity indeed means? In
principle different kinds of accounting methods and frameworks can be seen more or less
suitable for different strategic settings. But what actually does it mean that they are working?
Is it that accounting methods are in place and the decision is at least officially argued,
supported and documented by these calculations? Are they really “working” if the decision
maker is not actively engaged with those frameworks in the very moment when he is
strategizing? Is legitimizing the decisions enough to consider management accounting as
“working”? This research indicates that developing management accounting practices to be
more heavily involved in managerial actions would strengthen the essence of accounting in
managerial work.
The results of this study are in overall not so much concentrated on numbers. Also the
“actions” aspect emphasizes the managerial actions itself, not actually the numbers that
would help to take action. However the use of accounting information and numbers in
leadership positions is far from being an insignificant thing. Management, leadership and
management accounting systems seem to be interrelated in many meaningful ways.
Abernethy (2004) states that formal authority of a manager has an impact on how he/she uses
the accounting information. Also leadership styles have been shown to affect the use of
management accounting systems (Abernethy, Bouwens, Van Lent 2010) and perhaps also the
information receivers´ reaction to management accounting change (Jansen 2010). Perhaps
most important point from this paper´s point of view is to realize that using numbers can be
considered as a privilege for management and moreover: “Collective expectations regarding
the use of numbers institutionalize and specify numbers as social resources” (Vollmer 2007).
Through the use of accounting information and numbers, situated activity (managerial
actions) gains significance through time.
4 DISCUSSION
The purpose of this research was to approach the topic of managers and accounting through
experiences, opinions, reflections and visions of practicing managers. The paper describes
manager´s understanding of accounting which was ultimately described in the form of four-
dimensional framework (picture 4). The findings and conclusions of this research are still
under development in order to seek their final form. However at this point it is evident that
this research contribution has implications to many aspects of management accounting. The
developed framework describing the accounting world of a practicing manager offers a
comprehensive view on accounting which challenges and offers potential for development in
many aspects of accounting. The following decribes the implications and meaning of this
research to some areas of accounting education, research and practice
Management education
The results have implications on management education. Quite often in the accounting
literature the educational approaches for practicing managers are emphasized less than
educating the accounting professionals. When educating accountants, the production of
numbers is one key emphasis. On the other hand, from management work perspective, it is
the other kind of things that would require more attention. The “knowledge base” was only
one of the four key areas in practicing managers´ view on accounting. Frameworks and
practices managers´ value and use come from somewhere and it makes a difference what you
mindset as a manager is related to accounting. People tend to “value what they own”,
meaning that managers who are for example committed to a particular cost management
system become overconfident and change resistant regarding the system (Jermias 2006). So it
really makes a difference what is to be learned, what mindsets and frameworks are adopted
etc. Management education is a crucial way in paving the way perhaps for career-lasting
choices in management frameworks and models. The results of this research may be used in
order to design a management accounting education curriculum better tailored to practicing
managers.
The results of this research shed some light into learned-centered approach in accounting
education for managers. The learners aim should be in understanding management
accounting techniques in their own organization’s context, not as general methods. Practical
management accounting education for executives should emphasize the practicality in a way
that is really rooted in their everyday work, not practical only in a way that the learners
simulate decision making situations in some other context than their own. A true management
accounting learning mindset for practicing manager is about building on a person’s previous
knowledge and experience. In fact, more than that, it is about challenging the manager’s own
thinking and mindset, reflecting on one’s own experiences against the backdrop of state-of-
the art management accounting frameworks and case examples.
Accounting profession
This paper holds important messages for management accounting profession. First of all it is
worth noticing that management accountants are more or less missing from the narratives.
Their presence is weak in learning experiences, organizational development and competence
building. The research setting has probably affected to this and sure accountants exist in the
background but is should be if not alarming, at least very much worth noticing that
accounting professional do not rise specifically into spotlight in these stories. Actually quite
contrary for example in organizational development the themes of profitability consciousness
and managing with an accounting mindset are more attached to management than accounting
activities and the need of good numbers does not explicitly underline that they should be
produced by management accountants. This research corresponds to claims presented by
Burns, Hopper and Yazdifar (2004) when they argued that longetivity of the role of
management accountant should not be taken for granted. Management accountants are facing
a challenge of making an impact in the world of a practicing manager. However, the potential
drift towards more business oriented, influential and active role for accounting professionals
is not unambiguous effort. Producing management accounting information that penetrates
into practice in a focused way can also be seen as provocative and intrusive by nature (Vaivio
2004).
From accounting profession point of view, it is also quite surprising that different initiatives
regarded as strategic management accounting -methods were not more pronounced than this.
One could expect for example that when managers are offered a possibility to present their
visions and views about how to develop management accounting, more suggestions would be
presented related to SMA practices. This research links to Langfield-Smith (2008) who has
presented concerns about the low level adoption and interest towards SMA. Nixon and Burns
(2012) continue the criticism by stating that there is a contradiction between the decline of
SMA and the growth in the number of concepts and frameworks in strategic management
domain. They argue that SMA literature has neglected and has not addressed several
developments in strategic management literature. This research at hand connects to this
discussion by bringing forward that managerial mindset on management accounting is not
merely a collection of ways for counting euros, but instead a more multi-dimensional way of
looking at organizations, about people´s actions and interaction.
“Good management accounting is about taking care of the company´s competitive
advantage” (Director)
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