Abstract
In this article, we provide an overview of applications of simulation as a research method in the domain of management accounting and control (MAC). According to different perspectives on management control systems, we report on simulation-based research efforts related to (1) management accounting systems, (2) organizational control mechanisms for managerial decision-making, and (3) strategy development and implementation. We find that—though not always labeled as “MAC”—simulation-based research provides valuable findings for the domain of MAC, and allows for shedding new light on conventional wisdom. For example, simulation-based research suggests that when evaluating the (in-)accuracy of management accounting systems, the mechanisms incorporated in management control systems, as well as the broader organizational context, like the organizational structure, has to be considered. We come to the conclusion that simulation-based research within the domain of MAC could, for example, contribute (i) to a deeper understanding of the interactions between the micro- and the macro-layer of organizations as well as (ii) to the emergent properties of management control systems.
Highlights
In managerial science, simulation is a frequently used methodological approach for developing theory in terms of gaining structural insights and understanding of fundamental processes within a certain area of interest (Davis et al 2007; Harrison et al 2007)
In the preceding sections we introduced simulation-based research efforts related with (i) mechanisms incorporated in management control system (MCS), (ii) organizational performance in the context of imperfect information, and (iii) biased managerial decision-making
The preceding sections provide an overview of simulation-based research in the domain of management accounting and control (MAC) and simulation studies from related fields of managerial science
Summary
Simulation is a frequently used methodological approach for developing theory in terms of gaining structural insights and understanding of fundamental processes within a certain area of interest (Davis et al 2007; Harrison et al 2007). Simulation is regarded to be beneficial when the underlying research question contains a fundamental tension (e.g., short-run vs long-run), captures a variety of highly interrelated variables (which lead to a high level of complexity), or is of a procedural nature (e.g., adaptation towards higher levels of performance) (Davis et al 2007; Wall 2014; Harrison et al 2007) Against this background, we seek to provide an illustrative overview of simulation-based research efforts in the domain of MAC. Given that we aim to provide an illustrative overview on the applications and contributions of simulation in the domain of MAC and that a database search on our topic appears problematic we decided to follow the approach as described above With this in mind and after giving a brief overview on simulation as a research method, we structure our illustrative survey on simulation-based research in the domain of MAC as follows: in Sect.
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