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The adoption of value‐based management in large UK companies

Author

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  • S. Cooper
  • D. Crowther

Abstract

Purpose - In the 1990s, a growing number of companies adopted value‐based management (VBM) techniques in the UK. The purpose of this paper is to explore the motivations for the adoption or non‐adoption of VBM for managing a business. Design/methodology/approach - An interview‐based study of 37 large UK companies. Insights from diffusion theory and institutional theory are utilised to theorise these motivations. Findings - It was found that the rate of adoption of VBM in the sample companies does follow the classical S‐shape. It also suggests that the supply‐side of the diffusion process, most notably the role played by consultants, was an influence on many companies. This was not, however, a sufficient condition for companies to adopt the technique. The research also finds evidence of relocation diffusion, as several adopters are influenced by new officers, for example chief executive officers and finance directors, importing VBM techniques that they have used in organizations within which they have previously worked. Research limitations/implications - It is quite a small scale study and further work would be needed to develop the findings. Practical implications - Understanding and theorising the adoption of new management techniques will help understand the management of a business. Originality/value - This research adds further evidence to the value of studying management accounting, and more specifically management accounting change, in practice. It shows the developments in the adoption of a new technique and hence how a technique becomes accepted in practice.

Suggested Citation

  • S. Cooper & D. Crowther, 2008. "The adoption of value‐based management in large UK companies," Journal of Applied Accounting Research, Emerald Group Publishing Limited, vol. 9(3), pages 148-167, November.
  • Handle: RePEc:eme:jaarpp:v:9:y:2008:i:3:p:148-167
    DOI: 10.1108/09675420810919711
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    Citations

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    Cited by:

    1. Sebastian Firk & Torben Schmidt & Michael Wolff, 2019. "Exploring Value‐Based Management Sophistication: The Role of Potential Economic Benefits and Institutional Influence," Contemporary Accounting Research, John Wiley & Sons, vol. 36(1), pages 418-450, March.
    2. Neil Conway & Simon Deakin & Suzanne Konzelmann & Héloïse Petit & Antoine Rebérioux & Frank Wilkinson, 2008. "The Influence of Stock Market Listing on Human Resource Management: Evidence for France and Britain," British Journal of Industrial Relations, London School of Economics, vol. 46(4), pages 631-673, December.
    3. Corinne Perraudin & Héloïse Petit & Antoine Rebérioux, 2007. "Marché boursier et gestion de l'emploi : analyse sur données d'entreprises françaises," Post-Print halshs-00175873, HAL.
    4. Christ, Katherine L. & Burritt, Roger L., 2016. "ISO 14051: A new era for MFCA implementation and research," Revista de Contabilidad - Spanish Accounting Review, Elsevier, vol. 19(1), pages 1-9.

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