Presentation on theme: "What does it mean to talk of New Directions in Management Accounting Research? David J Cooper, School of Business, University of Alberta."— Presentation transcript:
What does it mean to talk of New Directions in Management Accounting Research? David J Cooper, School of Business, University of Alberta. Thanks to CGA, CIMA and SSHRC for financial support for my research
Structure of presentation A.The fetish of the new. B.New observations C.Enduring concerns D.Some MA implications E.Conclusions
A: The fetish of the New. 1.Are we too concerned about fads and the new? Both in MA practices and in research. New will depend on perspective (including time and place). 2.Importance of continuities in research- accumulating evidence. Normal science. 3.Identifying enduring concerns, theoretically and in practice. Building a complex understanding of practice, as well as elaborating theory. 4.Is new better (than old, taken for granted, etc)?
A1.Fads and Fashions. Fads and fashion are treated pejoratively, and part of discourse of academics and practitioners; But lets take fads and fashion seriously- new names is rarely simply new wine in old bottles! MA fashion is produced, used and has effects. But in what ways?
Examining MA Fashions: Conventional approaches Typically, MA fashion is (negatively) moralized, both by academics and managers. E.g., to succeed as a fashion [business approaches] must have qualities that advertise either conspicuous leisure or conspicuous consumption for the user (Nystrom, 1928: 204). Moralizing discourages serious analysis. MA fashion too often dismissed as irrational. In research, management consulting and gurus are assumed to dupe organizations by selling unnecessary solutions. Keiser (2002) thus views consultants as creating their own demand.
Examining MA Fashions (2) MA fashions as a production process, recognizing that they are co-produced (Armstrong, 2002 and Jones and Dugdale, 2002). MA fashions seem to be cyclical, not necessarily progressive, but adopt the rhetoric of the times (eg RI and EVA). Fashions provide problems as well as solutions. Our study interested in how users make use of MA fashions- as Ax and Bjørnenak (2005) show, BSC used differently- constant translation. Recognize also that managers might adopt for the pleasure of change (Tarde, 1890: 293)
Examining MA Fashions (3) Fashion means that many people [and organizations] do the same thing at the same time across space, but fashions mean that they will be doing something else soon. (Czarniawska, 2005: 144). Involves conformity (mimetic behaviour) as well as nonconformity (leaders). MA fashions appeal to both. Studies of management fashion focus on development. Also important to ask: why this? why now? and, why here?
A2 and A3: An example of enduring concerns. Do we do enough to identify continuities and develop theory? Consider the work on MCS in the NCB in 1980s (Berry et al, 1985), Mueller and Carter (AOS forthcoming) and current study of SPMS in a MNE (Cooper and Ezzamel). Inter-professional conflict (accountants and engineers); Physical measures for operations and sales; financial measures for strategy and negotiation with environment; Loose coupling between management systems; Importance of history and culture; Managerial concern with control and perogatives, even if this contradicts technical efficiency.
A4: Is new better? I am not simply a romantic looking to a past golden age! But new MA often associated with greater bureaucratization (BSC), loss of managerial expertise through carving out of middle management (ABC), pressures to be unethical and to focus on short term (budgeting) and the monetarization of public space (cost-benefit, performance measurement). Elevation of efficiency and shareholder concerns over stakeholder, equity and environmental concerns.
B1: That being said……Some new observations. MA and its link to governance (conceived as whom should be the beneficiaries of corporation?); How Boards operate: (Roberts et al, 2005, 2006). Financialization (Froud et al, 2001); How capital markets permeate through the firm (Ezzamel and Burns, 2005). MA and globalization. Managing across space (Barrett et al, 2005; Gallhofer and Haslam, forthcoming). Spread of MA ideas (fads, fashions and translations)- Malmi (1999), Ax & Bjørnenak. (2005); Qu (2006). Reinvigorating research methods- using case studies.
B2:The value of field (case) studies THESE OBSERVATIONS ARE BASED ON FIELD (OR CASE) STUDIES FROM AN ORGANIZATIONAL AND SOCIOLOGICAL PERSPECTIVE. Cooper and Morgan (2006) argue for field studies to make accounting research more practical, to develop theory and to understand extremes in an uncertain and complex world. Aim is to facilitate phronesis- judgment based expertise that is situationally sensitive (Flyvbyerg, 2000). Similar to Schons (1982) concern with knowledge for reflective professional practice. Case studies as more than description or finding things out!
B3: And some new ideas? Practice based view. Business systems (and comparative MA). Bourdieu and reflexive sociology (capitals, fields and habitus).
B4: Practice based views A mix of ideas, but linked to idea that Study of MA is a set of calculative activities. Some influenced by Schatzki and Wittgenstein (Ahrens and Chapman, forthcoming). Others (eg Chua, forthcoming) more concerned with process view of organizing and managing (influenced by Weick). Most linked to a revised conception of the link between MA and strategizing. Often linked to Giddens ideas about structuration. Welcome focus on what management accountants (and other actors) do, with less attention on systems. Danger of functionalism and managerialism- valorizing management explanations and practices
B5: Varieties of Capitalism (or Business Systems) Institutional context matters! Forms of control depend on social and economic arrangements- degree of trust, authority relations, labour market arrangements, financial system, state involvement, etc. The study of management control therefore needs to take account of variations in forms of economic organization and interest groups, as well as in the societal institutions and agencies that help to structure them, in order to understand how and why different coordination and control systems become established and widely diffused in different institutional contexts. (Whitley, 1999: 209)
B6: Business Systems and MA Different forms of coordination and control suggest different forms and uses of MA across sectors and societies. A contingency approach based on macro political economy- although Whitley warns that: the comparative analysis of management control and accounting should, then, be based more upon ethnographic and fieldwork research, as well as detailed knowledge of particular societies and organizations than on postal surveys and descriptive statistical analysis (522). But how to conceive different systems and what is the relation between systems and practices?
B7: Conceiving of international MA in terms of convergence or divergence is insufficient! My work with Ezzamel suggests that while there is some convergence within HQs of MNEs, there remains considerable divergence in local units. Convergence in language and shareholder value orientation. Divergence in strategies to achieve control over labour (direct controls or responsible autonomy), and interaction with local context and rules.
B8: Bourdieus Reflexive sociology Emphasizes fields as sites of struggle and capital as whats valued in the field. Economic, cultural, social capitals. Struggle often about language and what can be said and thought. Reflexivity applies to everyone- eg us knowing our position in the academic field. Important for those action researchers, as well as academics wishing to get on. Accounting and language- symbolic violence; what is ignored, recognized and mis-recognized. MA as a technology of power- its use as mechanism of power in a field. Role of MA in movement from fields of restricted production to fields of wide scale production (Kurunmaki, 1999 in health, Oakes et al, 1998 in museums). Mechanism of marketization.
C1. Of course, there are some enduring ideas (that may seem new to some!) Sociology of translation (ANT)- hybrids, networks, translations and inscriptions in MA. Ezzamel et al, 2005; Jones and Dugdale, 2002; Mouritsen and Thrane, Labour process and worker resistance (Armstrong, 2002; CPA Special issue, 2006, Saravanamuthu & Tinker, AOS 2003,Bryer, CPA, 2006); Institutional theory (IT- how things become taken for granted). Berry et al, 1985; Covaleski and Dirsmith,1988; Malmi, This is not the same as economics (old) IT of Burns and Scapens, Giddens structuration applied to local-global dialectic (Barrett et al 2005). Constructivism and action approaches (building better MA- Laughlin, 1987; Kasenen et al, 1993; Labro & Tuomela,2003). The importance of external context in management controls (Tinker and Merino, 1986; Hopper et al, 1986; Whitley, 1999).
C2: Building on the enduring Continue to explore these ideas. Develop and test these theories. Seek refutations, not confirmations! To test theory and examine variation (extremes) Feed back to source disciplines.
D: MA implications Some brief elaborations…..
D1: MA and governance Beyond rule and agency based views of governance. Bureaucracy and capture the popular metaphors that generate valuable work on compensation and disclosure. Such metaphors tend to correspond to regulators and managerial conceptions. But academics have a role to play in developing and exploring alternative metaphors: eg theatre, spectacle, control, cooperation, battle. Enrich understanding and maybe explain failures of popular models. How do Boards actually work? The ownership- control debate suggests we might overstress conflicts of interests (and ignore systemic commonalities). The commonalities of interests between owners and managers (Roberts and colleagues). What does MA have to offer debates about internal controls- e.g on contingency approaches to control? (Cooper and Gendron, 1999)?
D2: MA and financialization Financialization suggests that firms make money through financial activities (e.g Treasury, M&A) as much as (more than?) through productive and distribution. Role of MA in these processes- making the capital market everyones business through accounting. What do we know about role of MA in making M&A successful (or not)? Recall Jones (1984)
D3: MA and globalization MA as a coordinating mechanism across diverse spaces; but also used to maintain local autonomy (Barrett et al, AOS, 2005); Despite popular literature on MNEs (Bartlett and Ghoshal, 1989), recent research offers a more complex understanding of variations in global management control recipes. E.g, Kristensen & Zeitlin (2005) show how HQ in UK multinational doesnt know subsidiaries and instead focuses on financial engineering. Subsidiaries focus on local strategies and use of MA. Similarly, MA (and ERP) used differently in different MNEs (Quattrone and Hopper, AOS, 2005) Role of TP and taxation- Picciotto, 1992; Cools (2002 PhD) and Emmanuel and Cools (forthcoming). Interaction of compliance, tax minimization, performance evaluation and decision facilitating roles of TP systems.
D4: Spread of MA ideas (Tentative) ideas based on joint project, funded by CIMA, with Ezzamel and Qu, on BSC. History of the idea- KNs (emergent) strategy of open source. Global- local interconnection; Movement of the idea- from innovators to consultants to clients. Each movement involves translation (not diffusion); How an idea becomes objectified; A solution attached to multiple issues and problems (garbage can model); Somewhat de-coupled from issues of efficiency. Symbolic- normative, coercive and mimetic pressures.
E. Conclusions: theme 1 Lets play more attention to MA as an international phenomenon- different approaches are too often regarded as deviations form Anglo- Saxon norm. Business systems approach suggests a more macro contingency theory to understanding MA and an appreciation that there may exist dysfunctional practices where one approach is imposed on all others.
Conclusions: theme 2 Lets pay more attention to MA design- making MA better. Design requires values to be incorporated into our research (eg., supporting innovation, healthy workplaces, ecological sustainability etc). Value of case studies to learn reflective practice.
Conclusions: theme 3 Lets learn more about how MA ideas and practices are spread and are used. Interaction of global and local. Role of consultants, textbooks, professional syllabi, professional associations, business press, etc.
Conclusions: theme 4 Lets focus both on the new (and in what ways new ideas and practices are made use of) and on enduring features of MA. But why should MA be any different than clothing, food, travel, music and other areas of culture? Fashion is part of the game! Lets take MA fashion seriously!