Managing It All By numbers: A Review of Johnson & Kaplan's ‘Relevance Lost’

Abstract

This review article sets out the Johnson and Kaplan diagnosis of the ‘problem’ with modern US cost accounting and management control systems (‘MAS’) and challenges both their historical analysis and their proposed remedy. It traces the genesis of the knowledge-based disciplinary power of managerialism from the 1830s in the US and contrasts the development of the US/UK focus of MAS on ‘managing by the numbers’, with the different way that knowledge-power has been used by, and has interacted with, managerialism in Japan. It argues that the problems to be confronted with MAS are inherent in the historical genesis of such systems and that it is the behavioural limitations in the way organisations deploy MAS that most need attention. In addition the interrelationships of control between the accounting measurements that create visibility within and without the organisation require that greater attention be addressed to the technical limitations of financial accounting. In conclusion it is suggested that the differing alignments of knowledge-based expertise and disciplinary practices of management control that have developed in the US/UK and in Japan reflect deeper differences in their cultural history.