The Sophistication of Performance Measurement System in Manufacturing SMEs: The Role of the Interpersonal Ties in Top Management Teams

2019 ◽  
Author(s):  
Mohamed Ahmed
Keyword(s):  
Performance Measurement ◽  
Measurement System ◽  
Top Management Teams ◽  
Management Teams ◽  
Performance Measurement System ◽  
Top Management ◽  
Interpersonal Ties

How Top Management Teams Use Management Accounting Systems to Implement Strategy

2006 ◽  
Vol 18 (1) ◽  
pp. 21-53 ◽  
Author(s):  
David Naranjo-Gil ◽  
Frank Hartmann
Keyword(s):  
Management Accounting ◽  
Firm Strategy ◽  
Top Management Teams ◽  
Strategy Implementation ◽  
Management Teams ◽  
Survey Study ◽  
Top Management ◽  
Accounting Systems ◽  
Management Accounting Systems

In this paper we investigate how top management teams (TMTs) use management accounting systems (MAS) for strategy implementation. Consistent with upper echelon theory we argue that professional and administrative TMTs differ in their use of MAS, which in turn affects the implementation of strategic policies. We extract three dimensions of MAS use from extant research on the MAS-strategy relationships. We further distinguish between sets of strategic objectives aimed at cost reduction and flexibility enhancement as part of an overall firm strategy. Hypotheses are developed and tested in a survey study among 884 TMT members in all 218 general hospitals in Spain, forming 92 complete TMTs. Overall, we find systematic differences between professional and administrative TMTs in their use of MAS and its effects on strategy implementation. In a secondary analysis, we explore whether the observed differences in the use of MAS are consistent with the coercive-enabling framework recently introduced into the management accounting literature. We find considerable support for the validity of this framework in our sample. Overall, the paper contributes to the growing literature on the role of MAS in supporting strategy implementation. We extend this literature by explicitly recognizing the role of TMT composition in both strategy implementation and the use of MAS and by providing evidence of the validity of the coerciveenabling framework of MAS in a cross-sectional analysis.

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