PART III

PART III

1. L15: Mindset change and the controller role

   • Contingency theory: Bourmistrov og Kaarbøe (2013)
     • Beyond Budgeting: transition from comfort to stretch zone
       • Process side
         • Goals/targets should be more relative
         • "Stretched" planning
         • Dynamic resource allocation
       • HR-leadership side
         • Bases on trust, transparancy and internal motivation
           • Value-based behavior
           • More autonomy
       • Criticism of "Comfort zone"
         • May prevent organizational learning (Burdett 1994)
         • Managers may lose interest in lose interest in abilities associated with using information as entrepreneurs who explore, manage, and minimize organizational risks
       • Criticism of stretch zone
         • The danger of stretching "too far"
         • use of more dynamic forecasts does in general improve accuracy of information, but does not necessarily improve decision-makers’ abilities to make better decisions (Tanlu, 2009)
     • Oilco & Telco: A contingency theory Case study
       • Motivation factors
         • Both companies’ motivation for introducing a new MCS based on the ideas of BB was closely related to eliminating the comfort role of budgets.
       • Changes in information supply
         • both organizations reported that the use of information changed after the introduction of BB. Information use changed not only regarding information for strategic purposes, but also for the daily use of information by the individual.
       • Use of information
         • In terms of Burchell et al. (1980), the new system has improved the handling of typical structured decisionmaking situations (see results 3).
   • Contingency theory: Otley
     • Some important contingencies
       • 1, Technology
       • 2.Environment
         • Khandwalla: sophistication of accounting and control systems was influenced by the intensity of the competition it faced.
       • 3. Organization's structure
         • the structure of the organisation affects the manner in which budgetary information is best used. Hopwood (1972)
     • Conclusions: Environment and technology are seen as affecting organizational structure which in turn affects the design of accounting information systems.
     • Studies using CT were of two types
       • Explicit use
       • Implicit use
     • Otley's contingency framework
       • because accounting systems are an important part of the fabric of organisational life, they need to be evaluated in their wider managerial, organisational and environmental context.
       • Contingent variables are considered to be outside managerial control

2. L16: Accounting change

   • Institutional: Burns & Scapens
     • The Role of Power in the processes of change
       • Explicit power
       • 2nd level
       • 3rd level
     • What is an institution?
       • Grounded in rules, values and beliefs
       • Institutions shape behavior, but actions are again determined by institutions
         • Social habits are difficult to change
     • Three theories within management accounting change as a process
       • 1. New institutional sociology
         • Diffusion processes fuelled by 3 isomorphisms
           • 1. Coercive isomorphism (rules, regulations)
           • 2. Normate isomorphism (professional norms)
           • 3. "Mimetic" isomorphism (imitation of the "best practice"
         • Organisations are becoming more "like" each other rather than more different (conting.th)
         • conflict between technical efficiency concerns, and organisational legitimation.
       • 2. Old institutional
         • Focus on the constant swings between stability and change
         • Interplay between rules and routines
       • 3. New institutional theory
       • 4. Neo-institutional sociology
         • Path-dependency thinking
           • Ex: Keyboard
     • Conventional economics based approach
       • Does not explain why different techniques in different organization (ABC)
     • The FRAMEWORK
   • Institutional theory: Lounsbury
     • Rationality
       • Multiple rationality can explain institutional variety
       • Institutional work can create new institutions
       • Contending logics shape variation in the practices and behavior (in the same institution)
     • "Lounsbury: accounting systems shape and are shaped by intra-organizational dynamics"
       • Accounting can provide a crucial context to explore these issues
   • Rationalistic view vs Institutional view: A model

3. L17: Performance measurement implementation (Institutional)

   • An Institutional Perspective on Performance Measurement and Management
     • What is seen as “good” or “bad” performance in particular organisational fields is grounded in institutional rationalities or logics.
     • Some fields will be dominated by one or a few conceptions of performance (Stock-listed)
     • Other fields will be more fragmented and underpinned by multiple, competing conceptions of performance (public health-care)
   • MODELL (2012)
     • The Politics of the BSC
       • I. Issues of implementation and organizational learning
         • 1. As a result of being poorly adapted to specific organizations
         • 2. ... or facing significant resistance from lower organizational levels
         • 3. Might also be because of organizations dominated by high cultural controls
       • II: issues of diffusion and dissemination
       • III: Issues of performance measurement and strategic alignment
         • weight attached to specific performance aspects is a function of the relative power of diverse stakeholder groups.... rather than a natural outcome of the successful implementation of BSC
     • The Rationale to adopt the BSC:
       • Little attention is paid to the wider social and political processes compelling organisations to adopt management innovations
     • Learning & Growth perspective
       • Downplays any conflicts that need to be resolved to overcome barriers to learning
     • Svensk lånekassen eksempel
   • Institutional theory: YANG OG MODELL (2013)
     • Dynamic view of power
       • Episodic power
         • Pro-active agency
       • Systemic power
         • Institutionally embedded
     • Changing power relationships
       • SNBSA case

4. Part III:

   • Contingency
     • Otley
       • theory
     • Bourmistrov & Kaarbøe
       • Beyond Budgeting: Comfort to stretch
   • Institutional
     • Burns & Scapens
       • theories
     • Lounsbury
       • Rationality
     • Modell (2012)
       • Implementation of BSC
     • Yang & Modell
       • Changing power relationships