Perceived environmental uncertainty, supply chain purchasing strategy, and use of MAS information

Abstract

PurposeThe purpose of this paper is to investigate the relationship between perceived environmental uncertainty (PEU), supplier development (SUD) and the use of broad scope management accounting systems (MAS) information. In recent years, many companies have come to recognize the important role supply chain purchasing strategy plays in achieving competitive advantage. One of the key components of the supply chain purchasing strategy is supplier development. In addition, there have been calls for research into how changes in supply chain management affect the use of MAS.Design/methodology/approachAbout 78 managers from different organizations participated in this Finnish study. Using operations management and accounting literature, four hypotheses were proposed in the study. Data were collected from managers using a mail‐out questionnaire.FindingsThe results revealed that PEU is a determinant of SUD, which, in turn, is a determinant of the use of MAS. In other words, SUD plays a mediating role in the relationship between PEU and the use of broad scope MAS information.Research limitations/implicationsThis paper describes the responses from 78 managers in medium to large size manufacturing firms in North‐Western Finland and consequently a caveat about generalizability is appropriate notwithstanding the high‐global esteem of Finnish manufacturing.Practical implicationsThe competitive production environment that exists today has forced many firms into lean production. This paper suggests that under such conditions of uncertainty the incorporation of SUD data into the MAS may prove very salutary.Originality/valueThe findings of this paper should prove useful to firms entertaining an upgrade and broadening the scope of their MAS to include supply chain management information, particularly as it relates to supplier development.

Performance implication of market orientation and use of management accounting systems

“…MO and use of MASs accounting in a market-oriented setting (Agbejule, 2005;Agbejule and Burrowes, 2007;Mia and Winata, 2014). Second, the findings from this study support the RBV (Chenhall, 2003) and the knowledge-based view (Grant, 1996) while arguing and providing evidence that MAS is a resource that meets the VRIN conditions and can enable firms to promote learning and create knowledge for competitive advantage and superior firm performance in a competitive environment.…”

Contingency Factors of Management Accounting Practices in Thailand: A Selection Approach

“…Recent research investigated the relationship between PEU, supplier development and the use of broad scope management accounting system information. The findings indicated that the increase in PEU motivates firms to adopt more supply chain strategies, which place more demands on the use of management accounting system (Agbejule & Burrowes, 2007). These research findings lead to the conclusion that PEU is a potential contextual variable in a contingency model.…”

Drivers of Hotel Departments' Performance: Evidence From Australia

“…Gul and Chia (1994) found a statistically significant three-way interaction between a manager's perceptions of environmental uncertainty, decentralized organizational structure, and MAS information used on managerial performance. Furthermore, Agbejule and Burrowes (2007) reported that when managers perceived their environment to be uncertain they flexed their supply chain purchasing strategies by making extensive use of MAS information, which resulted in an overall improvement in performance. The results obtained in this research support the findings of Gul and Chia (1994) and Agbejule and Burrowes (2007), and further emphasize the GMs' transformational leadership style and DMs application of MAS information in the hotel industry, particularly to help overcome the competitive environment and the unique characteristics of hotel products and services.…”

“…These two elements can create stress and ambiguity for DMs. According to Agbejule and Burrowes (2007) and Gul and Chia (1994), to effectively drive the performance, managers need to first find and then process appropriate MAS information. Gul and Chia (1994) found a statistically significant three-way interaction between a manager's perceptions of environmental uncertainty, decentralized organizational structure, and MAS information used on managerial performance.…”

“…Another key feature that transformational leadership exhibits is passing decision-making responsibility down an organization's hierarchy, resulting in an increased number of short-and long-term decisions being made by middle and junior managers. According to Agbejule and Burrowes, (2007), Downie, (1997), and Patiar and Mia, (2008a), when managers need to make an increased number of decisions, a large variety of information from different sources is required so as to reduce uncertainty and ensure the outcomes of their decisions are positive.…”