Stability and change: an institutionalist study of management accounting change

Purpose – This paper explores the relationship between “stability and change” within with the process of accounting change It focuses on the ceremonial way in which a new system of value‐based management (VBM) was implemented and how the key performance indicators (KPIs) became decoupled from the day‐to‐day activities of the business, thereby creating a level of stability which ultimately contributed to accounting change.Design/methodology/approach – It uses a longitudinal study of a company in which value‐based management was imposed by its parent. It is informed by an institutionalist framework which draws on concepts from both old institutional economics (OIE) and new institutional sociology (NIS).Findings – It shows that stability and change are not necessarily contradictory or opposing forces, but can be intertwined in an evolutionary process of change.Research limitations/implications – Although there is accounting change within the case study, it is problematic to characterise it as either successf...

[1]  Andrew Molinsky,et al.  Sanding down the Edges , 1999 .

[2]  Bruce G. Carruthers,et al.  Accounting, ambiguity, and the new institutionalism , 1995 .

[3]  Sven Modell,et al.  Goals versus institutions: the development of performance measurement in the Swedish university sector , 2003 .

[4]  R. Greenwood,et al.  Understanding Radical Organizational Change: Bringing Together the Old and the New Institutionalism , 1996 .

[5]  John Burns,et al.  Management accounting change , 2001 .

[6]  Alnoor Bhimani,et al.  A study of the emergence of management accounting system ethos and its influence on perceived system success , 2003 .

[7]  S. Mezias.  An Institutional Model of Organizational Practice: Financial Reporting at the Fortune 200 , 1990 .

[8]  M. Covaleski,et al.  An Institutional Theory Perspective on the DRG Framework, Case-Mix Accounting Systems and Health-Care Organizations , 1993 .

[9]  Tamás S. Vámosi.  Continuity and change; management accounting during processes of transition , 2000 .

[10]  E. Schein.  The Corporate Culture Survival Guide , 1999 .

[11]  Sven Modell,et al.  Performance measurement and institutional processes: a study of managerial responses to public sector reform , 2001 .

[12]  Robert W. Scapens,et al.  Conceptualizing management accounting change: an institutional framework☆ , 2000 .

[13]  Markus Granlund,et al.  Towards explaining stability in and around management accounting systems , 2001 .

[14]  Sudi Sharifi,et al.  Corporate Culture and Strategic Change , 1989 .

[15]  E. Schein.  Organizational Culture and Leadership , 1991 .

[16]  W. Scott,et al.  Institutions and Organizations. , 1995 .

[17]  P. Bush,et al.  The Theory of Institutional Change , 1987, Evolutionary Economics.

[18]  Raymond F. Zammuto,et al.  Quantitative and qualitative studies of organizational culture , 1991 .

[19]  Paul M Collier,et al.  The Power of Accounting: A Field Study of Local Financial Management in a Police Force , 2001 .

[20]  C. Oliver.  STRATEGIC RESPONSES TO INSTITUTIONAL PROCESSES , 1991 .

[21]  K. Weick,et al.  Loosely Coupled Systems: A Reconceptualization , 1990 .

[22]  Åge Johnsen,et al.  Implementation Mode and Local Government Performance Measurement: A Norwegian Experience , 1999 .

[23]  Marc R. Tool.  The Theory of Instrumental Value: Extensions, Clarifications , 1993 .

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

[25]  Gavin J. Wright.  An evolutionary theory of economic change , 1982 .

[26]  T. J. Brignall,et al.  An Institutional Perspective on Performance Measurement and Management in the 'New Public Sector' , 2000 .

[27]  Charles Perrow,et al.  Overboard with Myth and Symbols , 1985, American Journal of Sociology.

[28]  M. Granlund,et al.  It is a Small World of Management Accounting Practices , 1998 .

[29]  Stephen Swailes,et al.  Organizational Change , 1997 .

[30]  K. Weick.  Educational organizations as loosely coupled systems , 1976, Gestión y Estrategia.

[31]  C. Perrow.  Complex Organizations: A Critical Essay , 1975 .

[32]  A. Pettigrew.  Longitudinal Field Research on Change: Theory and Practice , 1990 .

[33]  Mark W. Dirsmith,et al.  Budgeting as a means for control and loose coupling , 1983 .

[34]  Stanley G. Harris,et al.  Organizational Culture and Individual Sensemaking: A Schema-Based Perspective , 1994 .

[35]  John W. Meyer,et al.  Institutionalized Organizations: Formal Structure as Myth and Ceremony , 1977, American Journal of Sociology.

[36]  P. David.  Why are institutions the ‘carriers of history’?: Path dependence and the evolution of conventions, organizations and institutions , 1994 .

[37]  D. Dunphy,et al.  Transformational and Coercive Strategies for Planned Organizational Change: Beyond the O.D. Model , 1988 .

[38]  K. J. Euske,et al.  RATIONAL, RATIONALIZING, AND REIFYING USES OF ACCOUNTING DATA IN ORGANIZATIONS. , 1987 .

[39]  Teemu Malmi,et al.  Towards explaining activity-based costing failure: accounting and control in a decentralized organization , 1997 .

[40]  W. Powell.  Expanding the Scope of Institutional Analysis , 1991 .

[41]  Trevor Hopper,et al.  Management accounting within world class manufacturing: a case study , 1999 .

[42]  John Roberts,et al.  Accounting and control: a case study of resistance to accounting change , 1993 .

[43]  Jeremy F. Dent.  Accounting and organizational cultures: A field study of the emergence of a new organizational reality , 1991 .

[44]  Patrick Dawson,et al.  Reshaping Change: A Processual Perspective , 2003 .

[45]  Edgar H. Schein,et al.  Models and Tools for Stability and Change in Human Systems , 2002 .

[46]  S. Winter,et al.  An evolutionary theory of economic change , 1983 .

[47]  Robert W. Scapens,et al.  Never mind the gap: towards an institutional perspective on management accounting practice , 1994 .

[48]  John Burns.  The dynamics of accounting change Inter‐play between new practices, routines, institutions, power and politics , 2000 .

[49]  W. Dugger,et al.  The New Institutionalism: New But Not Institutionalist , 1990 .