The Effects of the Strategy and Goal on Business Performance as Mediated by Management Accounting Systems

Nimnual Visedsun,Kanitsorn Terdpaopong

doi:10.3390/economies9040149

Abstract

Previous research in the literature often investigated the associations between management accounting systems and the success of organizations. However, little has been done in regard to the association of business strategies, goals, and firms’ performance while having management accounting tools as mediators. Management accounting systems are classified as traditional and strategic management accounting themes. Each theme, of course, implements different accounting tools. This article explores the degree to which, as mediated by management accounting systems, the business strategies and business goals of large Thai manufacturing companies influence their financial and non-financial performance. To gather the data, a survey questionnaire was developed. Of the 1500 companies selected for inclusion in the survey, 205 provided completed and usable responses for a response rate of 13.67%. Structural equation modeling (SEM) was used to analyze the relationships among the variables. The findings shed some light on what the management of a firm could expect concerning organizational performance from their business strategies, business goals, and the implementation of specific management accounting systems. Corporate strategies and corporate goals had a statistical influence on both the financial and non-financial performance of the large corporations in Thailand when mediated via strategic management accounting systems, while there was no influence when mediated by traditional management accounting systems. A greater understanding of the relationships and effects of which mediators should have been employed in organizations to bring forth business strategies and business goals and generate productive results for organizational performance is provided by this research. Choosing the appropriate performance mediators can help achieve corporate strategies and goals.

Highlights

Businesses reap a range of advantages by adopting financial and non-financial initiatives in their organizations
The traditional management accounting systems (TMASs) impact was neither statistically significant to the financial performance (FP) of the firms nor to the non-financial performance (NFP). These results indicate that neither the FP nor the NFP were affected by the TMAS
There have been considerable debates surrounding whether business strategies and business goals, with management accounting systems, have any impact on firms’ performance

Summary

Introduction

Businesses reap a range of advantages by adopting financial and non-financial initiatives in their organizations. In evaluating a company’s efficiency, financial indicators are normally used, while some non-financial metrics, including customer loyalty and employee satisfaction, need to be weighed and cannot be ignored The organizational climate, such as leadership, culture, and organizational structure, can affect an organization’s success, and it is necessary to consider its impact (Odongo et al 2019). New management accounting tools have been designed to link a firm’s operations to its business strategies and goals Among these new tools are the following: the just-in-time inventory method, activity-based costing, total quality management, activity-based management, the balanced scorecard, benchmarking, re-engineering methods, and non-financial measurements of customer satisfaction. Such tools are employed in large, innovative firms which are located in highly competitive environments

Methods

Results

Conclusion