Exploring the Role of Management Accounting Systems in Strategic Sensemaking

Abstract Management accounting systems (MAS) provide an information context that is required for strategic sensemaking. Research from the interpretive perspective of information processing suggests some mechanisms how MAS can contribute to strategic sensemaking, although it neglects the relationship between MAS use and MAS dimensions. The systems-structural perspective identified some important MAS dimensions, but it does not explain how these dimensions contribute to strategic sensemaking. The objective of this study is to explore the role of MAS in sensemaking and how MAS dimensions contribute to this role. Based on 30 interviews with top and middle managers from 7 large companies we suggest a set of MAS dimensions that relates to sensemaking.

[1]  Christopher A. Higgins,et al.  Executive Support Systems and Learning: A Model and Empirical Test , 1995, J. Manag. Inf. Syst..

[2]  S. Kiesler,et al.  Managerial Response to Changing Environments: Perspectives on Problem Sensing from Social Cognition. , 1982 .

[3]  D. Otley,et al.  The effects of the interactive use of management control systems on product innovation , 2004 .

[4]  Denise M. English,et al.  Levers of Control , 1996 .

[5]  W. Stede.  The relationship between two consequences of budgetary controls: budgetary slack creation and managerial short-term orientation , 2000 .

[6]  Bernard J. Jaworski,et al.  Dysfunctional behavior and management control: An empirical study of marketing managers , 1992 .

[7]  Jeremy F. Dent.  Strategy, organization and control: Some possibilities for accounting research☆ , 1990 .

[8]  David Otley,et al.  Reliance on accounting performance measures: dead end or new beginning? , 2000 .

[9]  K. Moores,et al.  Management accounting systems and organizational configuration: a life-cycle perspective , 2001 .

[10]  F. Aguilar.  Scanning the business environment , 1967 .

[11]  F. Gul,et al.  The effects of management accounting systems, perceived environmental uncertainty and decentralization on managerial performance: A test of three-way interaction , 1994 .

[12]  R. Chenhall.  Management control systems design within its organizational context: findings from contingency-based research and directions for the future , 2003 .

[13]  B. Kuvaas.  An Exploration of Two Competing Perspectives on Informational Contexts in Top Management Strategic Issue Interpretation , 2002 .

[14]  D. Larcker,et al.  Quality strategy, strategic control systems, and organizational performance , 1997 .

[15]  J. Sandt.  Management mit Kennzahlen und Kennzahlensystemen , 2004 .

[16]  David J. Miller,et al.  The Architecture of Simplicity , 1993 .

[17]  J. Baum,et al.  STRATEGIC DECISION SPEED AND FIRM PERFORMANCE , 2003 .

[18]  H. Ansoff,et al.  Managing Strategic Surprise by Response to Weak Signals , 1975 .

[19]  Rodolphe Durand.  Predicting a firm's forecasting ability: The roles of organizational illusion of control and organizational attention , 2003 .

[20]  Vincent K. Chong,et al.  Management accounting systems, task uncertainty and managerial performance: A research note , 1996 .

[21]  K. Laverty,et al.  Managerial myopia or systemic short‐termism? , 2004 .

[22]  R. Kaplan,et al.  Using the balanced scorecard as a strategic management system , 1996 .

[23]  Robert E. Markland,et al.  The Performance Implications of Media Richness in a Business-to-Business Service Environment: Direct Versus Indirect Effects , 2004, Manag. Sci..

[24]  H. P. Sims,et al.  Top Management Team Demography and Process: The Role of Social Integration and Communication , 1994 .

[25]  Robert Simons,et al.  Strategic orientation and top management attention to control systems , 1991 .

[26]  Phani Tej Adidam,et al.  Antecedents and Consequences of Marketing Strategy Making: A Model and a Test , 1999 .

[27]  Margaret A. Abernethy,et al.  The role of budgets in organizations facing strategic change: an exploratory study , 1999 .

[28]  Betty Vandenbosch,et al.  An empirical analysis of the association between the use of executive support systems and perceived organizational competitiveness , 1999 .

[29]  Ephraim R. McLean,et al.  Information Systems Success: The Quest for the Dependent Variable , 1992, Inf. Syst. Res..

[30]  R. Daft,et al.  Toward a Model of Organizations as Interpretation Systems , 1984 .

[31]  Richard L. Daft,et al.  Organizational information requirements, media richness and structural design , 1986 .

[32]  K. Ferris,et al.  Perspectives on Accounting Systems and Human Behaviour , 1988 .

[33]  Sid L. Huff,et al.  Searching and Scanning: How Executives Obtain Information From Executive Information Systems , 1997, MIS Q..

[34]  M. Schulz.  THE UNCERTAIN RELEVANCE OF NEWNESS: ORGANIZATIONAL LEARNING AND KNOWLEDGE FLOWS , 2001 .

[35]  Chris Higgins,et al.  Information Acquisition and Mental Models: An Investigation into the Relationship Between Behaviour and Learning , 1996, Inf. Syst. Res..

[36]  A. Hopwood.  An Empirical Study of the Role of Accounting Data in Performance Evaluation , 1972 .

[37]  Janine Nahapiet,et al.  The roles of accounting in organizations and society , 1980 .

[38]  Lokman Mia,et al.  The usefulness of management accounting systems, functional differentiation and managerial effectiveness , 1994 .

[39]  Daniel H. Kim.  Organizing for learning : strategies for knowledge creation and enduring change , 2001 .

[40]  J. Fredrickson.  The Strategic Decision Process and Organizational Structure , 1986 .

[41]  R. Daft,et al.  How Organizations Learn: A Communication Framework. , 1986 .

[42]  K. Sutcliffe.  Organizational Environments and Organizational Information Processing , 2001 .

[43]  Kathleen M. Eisenhardt,et al.  Making Fast Strategic Decisions In High-Velocity Environments , 1989 .

[44]  Charles R. Schwenk,et al.  THE EFFECTS OF INFORMATION TECHNOLOGY ON STRATEGIC DECISION MAKING , 1995 .

[45]  J. Mathieu,et al.  Antecedents to Organizational Issue Interpretation: The Roles of Single-Level, Cross-Level, and Content Cues , 1994 .

[46]  Steven W. Floyd,et al.  Middle Management’s Strategic Influence and Organizational Performance , 1997 .

[47]  R. McDaniel,et al.  Participation in Strategic Decision Making: The Role of Organizational Predisposition and Issue Interpretation* , 1998 .

[48]  M. Yasai-Ardekani,et al.  Designs for environmental scanning systems: tests of a contingency theory , 1996 .

[49]  R. Chenhall.  Integrative strategic performance measurement systems, strategic alignment of manufacturing, learning and strategic outcomes: an exploratory study , 2005 .

[50]  Kenneth A. Merchant,et al.  The effects of financial controls on data manipulation and management Myopia , 1990 .

[51]  M. Abernethy,et al.  The consequences of customization on management accounting system design , 2000 .

[52]  Barbara Wixom,et al.  Antecedents of Information and System Quality: An Empirical Examination Within the Context of Data Warehousing , 2005, J. Manag. Inf. Syst..

[53]  H. Simon.  Bounded Rationality and Organizational Learning , 1991 .