Management accounting and corporate management: insights into multinational hotel companies

Abstract

PurposeThe aim of this paper is to provide insights into the links between managerial accounting, as a tool for monitoring and governing multinational hotel companies, and corporate management approaches.Design/methodology/approachThe paper builds upon an extensive survey of general managers previously published by the authors, followed up with interviews and an in‐depth analysis of different management scenarios in the context of multinational hotel companies.FindingsThis paper's findings suggest that “management by values” appears to be particularly adapted to multinational hotel companies, because of their organisation features, i.e. a network spread in different environments, and partially shapes the management accounting choices of performance indicators at various levels in the organisation.Research limitations/implicationsThe limitations of this research would depend on the limited amount of data collected, i.e. 13 interviews, of which eight are analysed, if there were any attempt to generalise the findings.Practical implicationsImplications are both theoretical and practical: the former refer to avenues of further research being opened within this paper, the latter refer to the suggestion that managers in multinational hotel companies might begin to question their own organisations and consider reflecting upon their management approach, in light of the insights provided in this paper.Originality/valueThis paper fits with the established literature on management accounting, but also points towards new connections with the corporate management literature.

Management control in multinational companies: a systematic literature review

“…Highly internationalized firms rely on setting goals and evaluating performance (Fee et al 2011;Kihn 2008;Mongiello and Harris 2006). Increasing geographical dispersion prompts the integration of non-financial controls (Kihn 2008;Mongiello and Harris 2006) and challenges management information systems not least due to the different locations of experts and operations across different time zones (Hyvönen et al 2008;Sheu et al 2004). In contrast to Gencturk and Aulakh's (1995) finding, that process control appears to be less relevant with increasing internationalization, Yu et al (2006) suggest that international experience has a positive effect on process control.…”

“…In the 1990s, aspects like headquarters nationality (e.g., Al Chen et al 1997;Coates et al 1992), cultural distance (e.g., Frucot and Shearon 1991;Hassel and Cunningham 1996) or environmental uncertainty (e.g., Borkowski 1999;Hassel 1991) were identified as determining factor. Newer studies confirm these factors (e.g., Dossi and Patelli 2010;O'Connor et al 2011) and complement internal contingencies like strategy (Busco et al 2008;Cools et al 2008;Seal 2001) or degree of internationalization (Dong et al 2008;Mongiello and Harris 2006;O'Connor et al 2011). Findings on output control are based on quantitative as well as qualitative studies.…”

“…On the other hand, it limits decision rights of subsidiary managements and strengthens centralization tendencies (e.g., Finnegan and Ni Longaigh 2002;Quattrone and Hopper 2005). For process control, again, headquarters nationality (e.g., Chow et al 1999;Van der Stede 2003) and environmental uncertainty (e.g., Gencturk and Aulakh 1995;Mongiello and Harris 2006) have been in the focus of research. Cultural distance (e.g., Crespo et al 2014;Richards 2000) and interdependence between business units (e.g., Du et al 2013;Martinez and Jarillo 1991) seem equally important for explaining process control.…”

“…Highly internationalized firms rely on setting goals and evaluating performance (Fee et al 2011;Kihn 2008;Mongiello and Harris 2006). Increasing geographical dispersion prompts the integration of non-financial controls (Kihn 2008;Mongiello and Harris 2006) and challenges management information systems not least due to the different locations of experts and operations across different time zones (Hyvönen et al 2008;Sheu et al 2004).…”

“…A certain degree of autonomy seems to exist for subsidiaries to react to local market requirements (Busco et al 2008;Epstein and Roy 2007;Mongiello and Harris 2006). Within defined boundaries, local subsidiary managers have decision rights for the operational business (Al-Husan and James 2003; Finnegan and Ni Longaigh 2002;Neves and Bugalho 2008).…”