Lokman Mia

The use of management accounting systems in hotels: an exploratory study

Abstract In this study we investigate use of management accounting systems by general managers and department managers in luxury hotels. We also investigate general managers’ emphasis on financial and non-financial performance indicators while they evaluate their department managers’ performance. In addition, managers’ satisfaction with details and availability of their hotels management accounting system (MAS) is assessed. The results indicate that general managers and department managers make equal use of MAS for both short and long-term decisions. However, a detail analysis of the data by manager groups indicates that general managers differ from department managers with respect to their use of MAS for making decisions. Furthermore, general managers, compared to department managers, are found to be more satisfied with the frequency in which MAS is available to them. On the issue of department managers’ performance evaluations by general managers, the results reveal that general managers put more emphasis on financial than on non-financial performance indicators. The department managers in the study were in charge of food and beverage and room departments. The sample is rather small; only 35 managers from one region in Australia participated in the study. Therefore, any generalisation of the results requires caution.

Enhancing hotel managers’ organisational commitment: an investigation of the impact of structure, need for achievement and participative budgeting

This study investigates the role of decentralised structure and managers’ need for achievement as antecedents of participative budgeting, and the impact of the concurrent relationships of all three preceding variables on organisational commitment. Ninety-one managers from the Australian hotel industry participated in the study and data were analysed using path analysis. Direct and positive relationships were found between the two antecedent variables: decentralised structure and managers’ need for achievement, and participative budgeting. Participative budgeting, in turn, was found to have a direct and positive relationship with organisational commitment. The results of the study have implications for the design of effective management control processes and for human resource management of hospitality organisations.

Just-in-Time manufacturing, management accounting systems and profitability

Abstract Managers working in just-in-time manufacturing environments have little or no slack resources available to them to cushion against the difficulties caused by defective raw materials, production errors, irregular supply and demand schedules or to mask inefficiencies (Griffin and Harrell, 1991). This makes the performance-related information provided by management accounting systems critical in such environments. This paper reports the results of a study that empirically tested the above statement. It was done by evaluating the impact of adoption of just-in-time manufacturing (JIT) and the information provided by the management accounting system on organisational performance (profitability). Data for the study were collected through personal interviews with financial controllers of 55 organisations located in Australia. Of these organisations, 28 adopted JIT at least three years prior to the study and the rest were non-adopters at the time of the study. The results suggest that the JIT adopter organisations with high (low) provision of the information earn high (low) profit. The study supports the argument that adoption of JIT and provision of the information together can assist an organisation in improving its profitability.

The effects of the balanced scorecard on performance: The impact of the alignment of the strategic goals and performance reporting

The balanced scorecard (BSC) and other multi-perspective systems have become popular in recent times because of problems with financial systems. The BSC is a strategic management system involving strategic goal setting and performance reporting across four perspectives: financial, customer, internal business processes, and learning and growth. Kaplan and Norton (1996), the creators of the BSC, argue that the performance reporting system must be aligned with the strategic goals. Although these systems are important, research in the area is still at an embryonic stage. The research objectives are to (1) investigate if the strength of the alignment of the strategic goals and the performance reporting system is associated with organisational performance, (2) investigate the dimensions of multi-perspective performance reporting and organisational performance, and (3) study their relationship. We found that (1) the strength of the alignment of the strategic goals and the performance reporting system was positively associated with performance, (2) there were 11 dimensions of performance reporting and 13 dimensions of performance, and (3) performance reporting on a particular dimension was positively associated with organisational performance in that area.

JIT Manufacturing Systems: Use and Application in Australia

Reports the results of the first stage of a study which investigates the adoption of just‐in‐time (JIT) manufacturing systems and the design of appropriate accounting information systems (AIS). While almost all adopters report that JIT has provided benefits to their business, it is not clear that managers fully understand or are, as yet, capable of exploiting the full advantages of JIT. Identifies several factors which appear to be important in the successful implementation of JIT management systems in Australia, including the close geographic proximity of suppliers and customers, the existence of a highly competitive market, a broad product range, small to medium firm size, the existence of flexible manufacturing technology, large inventory holdings as a percentage of total assets, the use of JIT by dominant industry members (automobile manufacturers) and a low degree of vertical integration in the firm. Industry type is also an important factor.

The relation between decentralised structure, budgetary participation and organisational commitment: The moderating role of managers’ value orientation towards innovation

Reports the results of a study which investigated the moderating role of managers’ value orientation towards innovation (VOI) on the relationships between managers’ organisational commitment and two management control features – decentralised organisational structure and budgetary participation. Data for the study were collected from 116 managers in manufacturing firms. The results indicate that managers’ VOI has a significant moderating effect on the relationships between the two management control features and managers’ organisational commitment. The results reveal that the relationships are stronger for managers with high VOI than for managers with low VOI. These results have implications for enhancing managers’ organisational commitment through the design of management control systems appropriate for the extent of innovative work values promoted by organisations.

Western management accounting practices in Vietnamese enterprises: Adoption and perceived benefits

Purpose – This study aims to examine the experiences of Vietnamese enterprises with respect to the adoption and benefits of Western management accounting practices (MAPs) during a period when the economy was in transition toward a more market‐oriented system.Design/methodology/approach – Questionnaire responses were obtained from the head or vice‐head of the accounting department in 181 enterprises, and follow‐up interviews conducted with 20 of the respondents. The responses were analysed with simple statistical tests and ANOVA.Findings – Two of the key findings are in line with results reported previously for other countries: adoption rates for “traditional” Western MAPs are higher than for “contemporary” ones; and state‐owned enterprises tend to exhibit lower adoption rates than other enterprises. A third key finding represents new insight, but it may be applicable to only Vietnam (and possibly a limited number of other transition economies). This third finding arises from our identification of a group ...

Multi-perspective performance reporting systems, continuous improvement systems and organisational performance

The use of multi-perspective performance reporting systems (MPRS) such as the balanced scorecard (BSC), is widespread. This studys motivation comes from the importance of these systems and the lack of knowledge about them. Continuous improvement systems (CIS) are another management innovation. CIS constantly look for ways to improve performance and are used in conjunction with performance reporting systems. The research objectives were to study MPRS users and discover whether the use of CIS improved organisational performance. It was found that the use of CIS by MPRS users was positively associated with performance. The implications of these findings for managers were considered.

Manufacturing strategy and organisational performance: The role of competition and MAS information

Purpose – The extant literature suggests that an increasing number of organisations are adopting manufacturing strategies such as JIT practices to continuously improve provision of products and associated services desired by customers. The authors aim to investigate the relationship between adoption (implementation) of JIT practices and organisational performance taking into account the role of market competition and managerial use of management accounting system (MAS) information. Design/methodology/approach – Data for the study were collected from 92 general managers of Australian manufacturing organisations. Mailed questionnaire and personal interviews were used to collect the data. Findings – The results reveal that market competition and managerial use of MAS (hereafter, the use of MAS) information impact the relationship between an organisations adoption of JIT practices and its financial performance. The results reported in prior studies on the relationship are mixed; some studies report a positiv...

Multi-perspective performance reporting and organisational performance: the impact of information, data and redundant cue load

Multi-perspective performance reporting systems (MPRS), such as the balanced scorecard (BSC), have become popular. The BSC reports performance about four perspectives (learning and growth, internal business processes, customer and financials). Although these systems are important, research in these areas has only just scratched the surface, hence the motivation for this study. A possible problem with multi-perspective systems is that they may cause information/data/redundant cue (I/D/C) overload and thus detrimentally affect the performance. The objectives of this research are to: (1) explore the relationship between MPRS and organisational performance and (2) study the relationship between I/D/C load and organisational performance in multi-perspective systems. We found that (1) MPRS are positively associated with performance and (2) there is a weak negative association between I/D/C overload and performance. Our exploratory results are consistent with the views of advocates of MPRS (e.g. Kaplan and Norton) that MPRS enhance organisational performance.