Linking Business Strategy to Management Accounting: A Study in Malaysian Service Organizations

Abstract

Despite being economically and socially important to Malaysia, little has been done to study the innovations in the administration of service organizations to maintain the survival of such organizations in the globalization era. The purpose of this paper is to examine the use of strategic management accounting (SMA), as an administrative innovation, by the service organizations operating in Malaysia. The literature suggested that business strategy is an important factor affecting the use of SMA techniques and, as a result, the use of SMA will differ with different strategic priorities. The SMA techniques studied are costing, competitor accounting and customer accounting, while business strategy includes cost leadership and differentiation strategies. Survey questionnaires were administered to managers yielding 62 usable responses. Using ANOVA, the present study finds that service organizations pursuing differentiation strategies place higher emphasis on competitor and customer accounting compared to service organizations pursuing cost leadership strategies. The results also reveal that the highest emphasis on all SMA techniques is found in service organizations that place high emphasis on both strategies.The study provides evidence regarding practices that place high emphasis on strategic issues that lead to a high usage of innovative information systems. Keywords: Strategic management accounting; business strategy; service organizations; Malaysia ABSTRAK Walaupun organisasi perkhidmatan memainkan peranan penting dalam perkembangan ekonomi dan sosial di Malaysia, namun kajian terhadap inovasi dalam memastikan kelangsungan organisasi sedemikian dalam era globalisasi ini masih terhad. Kertas ini bertujuan untuk mengkaji penggunaan perakaunan pengurusan strategik (PPS) sebagai inovasi pentadbiran oleh organisasi perkhidmatan yang beroperasi di Malaysia. Strategi perniagaan dikatakan sebagai factor penting yang mempengaruhi penggunaan teknik-teknik PPS dan cara penggunaan PPS adalah berbeza mengikut keutamaan strategik yang berbeza. Teknik-teknik PPS yang dikaji adalah pengekosan, perakaunan pesaing dan perakaunan pelanggan manakala strategi perniagaan meliputi strategi kepimpinan kos dan strategi pembezaan. Soal selidik kajian diedarkan kepada para pengurus dan sebanyak 62 daripadanya dapat digunakan untuk analisis. ANOVA menunjukkan bahawa organisasi perkhidmatan yang menggunakan strategi pembezaan lebih memberi perhatian kepada perakaunan pesaing dan pelanggan berbanding yang mengamalkan strategi kepimpinan kos. Dapatan kajian juga menunjukkan bahawa penggunaan tertinggi semuateknik-teknik PPS adalah dalam organisasi perkhidmatan yang meletakkan penekanan yang tinggi terhadap kedua-dua bentuk strategi. Kajian ini memaparkan bukti bagi amalan yang member penekanan yang tinggi terhadap isu-isu strategic membawa kepada penggunaan yang tinggi terhadap sistem maklumat yang berinovatif. Kata kunci: Perakaunan pengurusan strategik; strategi perniagaan, organisasi perkhidmatan; Malaysia

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