Date
2004
Dewey
Contrôle de gestion Comptabilité
Sujet
Regulation; Strategy; Management Accounting
JEL code
M41
Conference name
27th EAA Annual Congress
Conference date
04-2004
Conference city
Prague
Conference country
République tchèque
Author
Delouis-Girardi, Béatrice
Type
Communication / Conférence
Abstract (EN)
In this paper we analyse the role of management accounting for strategy in a growing competitive environment. This analysis is based on a litterature review. This environment corresponds to the actual context of business, where firms, due to globalisation and new markets opening to competition, have to deal with more and more competition. The intensification of competition may lead to such a change in the competition level that firms are called
to alter their strategy. Actually the competitive
environment is one of the five forces Porter defined as
determinant for strategy. In these conditions, we study both the role of management accounting in carrying out this strategy evolution and the influence of these changes in strategy on management accounting. Interactions between these two notions are in fact complex and reciprocal.
The word "management accounting" amalgamates
several notions : conventional management
accounting, strategic management accounting, and
strategic cost management. The main characteristic
of conventional management accounting is to be
intern-oriented, though strategic management
accounting focuses on the outside environment. The
strategic cost management is a variation of strategic
management accounting. Both strategic cost management and strategic management acounting are in fact developments of conventional
management accounting.
A growing competition context has influences on management accounting. Two types of influences might be identify : a direct influence, and an indirect influence. When the evolution in management
accounting is initiated by the firm itself, following an
intensification of competition, we call it a direct influence. When it comes from external pressures, in a context of growing competition, we call it an indirect influence. External pressures represent external actors who constrain companies to change their
management accounting systems. An example of this
intermediation is the regulatory agencies. A change in management accounting due to a growing competition environment is not always, and anyway not only, something the firm undergoes, a kind of obligation if it wants to outlive in this
environment. These changes may also be a mean the
firm uses to take advantage of this increasing
competition. In fact, a firm can use management accounting as a powerful tool to adapt its strategy to a growing competition. As management accounting materializes the new economic logics inherent in such strategic changes, it represents one of the best way to spread these logics around the firm. This spreading capacity comes from the general characteristics of management accounting. Management accounting
allows firms to reach a competitive advantage.
Initially based on internal cost’s analysis, management accounting can take three orientations depending on the strategy : the environmental and marketing orientation, the orientation towards
competitors, and the long-term progress orientation.
This makes management accounting particularly
appropriate and efficient to drive the strategy
adaptation to growing competition. Besides, some of
the management accounting techniques, especially
the Activity Based Costing (ABC), have more accurate
strategic implications. Moreover, high competition
reinforces the favourable effects of using ABC. Other
strategic initatives, engaged in the same time as ABC,
are sources of synergies and reinforce the role of
management accounting for strategy in growing competitive environments.