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Organizational culture and performance: the role of management accounting system

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  • Adebayo Agbejule

Abstract

Purpose - This study aims to examine the combined effect of the interactive and diagnostic management accounting system (MAS) use and organizational culture on performance. Using the contingency perspective, this study suggests that the performance is enhanced by the interaction of organizational culture and the simultaneous use of both types of MAS. Design/methodology/approach - Data were collected through a questionnaire, and responses from 147 senior managers provide support for the research model and demonstrate that each type of organizational culture requires different combinations of both types of MAS uses to enhance performance. Findings - The results of the study indicate that although both uses of MAS are required, highest performance for flexibility value firms is achieved when high interactive and low diagnostic MAS use is employed. On the other hand, for control value firms, this study indicates that using both high diagnostic and interactive MAS creates a positive effect on performance. Research limitations/implications - As in the case of most survey empirical studies, this study is static and may not capture the changes in organizational culture over time. To prevent this bias, longitudinal follow up studies would be required. Second, the self‐report data may be affected by common method bias. Practical implications - The present study indicates that managers should be aware of the dominant values of their organization cultures before deciding to use MAS in a specific way, and thus contributing to the effectiveness of organizations when both interactive and diagnostic are employed simultaneously. Originality/value - The results of the present study increase extant knowledge and understanding on the knowledge of the relationships between organizational culture and the use of MAS and how they influence performance. This is important because there are few empirical studies that have examined organizational culture using the competing values framework.

Suggested Citation

  • Adebayo Agbejule, 2011. "Organizational culture and performance: the role of management accounting system," Journal of Applied Accounting Research, Emerald Group Publishing Limited, vol. 12(1), pages 74-89, May.
    • Handle: RePEc:eme:jaarpp:v:12:y:2011:i:1:p:74-89
    DOI: 10.1108/09675421111130621
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    Citations

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    Cited by:

    1. Smith, Julia A. & England, Claire, 2019. "An ethnographic study of culture and performance in the UK lingerie industry," The British Accounting Review, Elsevier, vol. 51(3), pages 241-258.
    2. Edelcio Koitiro Nisiyama & José Carlos Tiomatsu Oyadomari & Chen Yen-Tsang & Andson Braga de Aguiar, 2016. "The Use of Management Control Systems and Operations Management Techniques," Brazilian Business Review, Fucape Business School, vol. 13(2), pages 56-81, March.
    3. Basim Abbas KRAIDY JASSMY & Cristian Silviu BANACU & Zaki Muhammad ABBAS BHAYA & Latif ATIYA, 2017. "The Coordination Between Internal Environment And Strategic Orientation To Enhance Commitment Behavior: Empirical Study In Iraqi Private Banks," Proceedings of the INTERNATIONAL MANAGEMENT CONFERENCE, Faculty of Management, Academy of Economic Studies, Bucharest, Romania, vol. 11(1), pages 359-377, November.
    4. Ilham Hidayah Napitupulu, 2018. "Organizational Culture in Management Accounting Information System: Survey on State-owned Enterprises (SOEs) Indonesia," Global Business Review, International Management Institute, vol. 19(3), pages 556-571, June.

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