Organizational lifecycle and strategic management accounting

Purpose This study aims to examine the relationship between organizational lifecycle stages, the adoption of strategic management accounting (SMA) practices and the performance consequences of SMA adoption. Design/methodology/approach The analysis is based on survey data from 377 firms operating in German speaking countries. Findings The author finds that the firms’ adoption rates of SMA increase from the birth to the revival lifecycle stages and drop at the decline stage. Firms that deviate from the optimal SMA profile have lower performance compared to the firms that do not deviate. The negative performance effect, however, is only significant for firms that have too little SMA practices and is not significant for firms that adopt too much SMA practices. Research limitations/implications These results suggest that firms that fail to implement a sufficient level of SMA suitable for their development stage will not develop as fast as their competitors. This study is subject to general limitations of survey research, particularly with respect to the operationalization of the variables, the number of contextual variables in the empirical model and sample coverage. Practical implications The implication for managerial practice is that greater efforts should be directed toward eliminating underfit than overfit regarding the implementation of management control systems. Originality/value This is the first analysis of the adoption of SMA at different life cycle stages and the consequences of misfitted adoption.

How innovation climate drives management styles in each stage of the organization lifecycle

Purpose Organizations that offer services based on knowledge and innovation consider their recruitment process as strategic. The purpose of this paper is to consider that organizational lifecycle is related with the management styles through innovation climate and human dimension of recruitment. Design/methodology/approach The authors utilized two methods proposed by Adizes (1976, 1979, 2004). The first one is an inductive, exploratory method with a quantitative approach. The second one utilizes a qualitative approach through semi-structured interviews. The quantitative approach was performed with a questionnaire via internet. The target was executive managers from organizations with more than ten employees, which are offering professional, scientific and technical services. The authors obtained 170 responses. Findings Results show that the majority of organizations balance open innovation and control, trending to the first one. During the first stages of the organizational lifecycle, decision-making principally relays on the founder’s open innovation strategies, whereas in the last stages administrative-based control is predominant. Research limitations/implications The authors must highlight that this study has been performed for the case of services companies placed only in Mexico. Then, the extrapolation and generalization of results should be dealt carefully. Practical implications The authors consider the questionnaire very useful for the introduction of open innovation strategies for human resources managers, since it takes into account organizational lifecycle in their human dimension of recruitment processes, it helps to design training and retention programs for employees, and avoids premature aging of the company. Social implications Given that today, knowledge management and innovation have become strategic assets of companies, it is necessary a change of mentality in many organizations that facilitates a new perception on the development of innovation. This will only be possible with the firm support of the management of the company and the involvement of all employees in this new task. Originality/value Several studies analyze management styles in each stage of organization lifecycle, although they do not link the obtained information to open innovation and human dimension of the recruitment process. The authors work applies the questionnaire of Adizes (1976, 1979, 2004), which relates the organizational life cycle and the management style and discloses the proper management styles with recruiting, training and retention programs to keep flexibility above control to nurture open innovation.

Influence of Founder—CEOs' Personal Values on Firm Performance: Moderating Effects of Firm Age and Size†

The effects of two values held by founder—CEOs (collectivism and novelty) on companies' post—start-up performance are investigated. By integrating congruence and organizational lifecycle literatures, the authors hypothesized that the effects of both values are moderated by company age and size, such that collectivism exerts stronger beneficial effects in older and larger firms, whereas novelty exerts stronger beneficial effects in younger and smaller firms. Results based on 92 small- to medium-sized enterprises offer support for most predictions, thus demonstrating the influence of founders' values on new venture performance and highlighting the importance of considering organizational lifecycle for the understanding of this influence.