THE USAGE OF CUSTOMER ACCOUNTING AS A SOURCE OF SUSTAINABLE COMPETITIVE ADVANTAGE: SOME EVIDENCE FROM QUOTED MANUFACTURING COMPANIES IN NIGERIA

Babajide Oyewo, Solabomi Ajibolade and Eddy Omolehinwa
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Babajide Oyewo: University of Lagos, Akoka, Lagos,, Postal: Department of Accounting, Nigeria, http://www.icanig.org
Solabomi Ajibolade: University of Lagos, Akoka, Lagos,, Postal: Department of Accounting, Nigeria, http://www.icanig.org
Eddy Omolehinwa: University of Lagos, Akoka, Lagos,, Postal: Department of Accounting, Nigeria, http://www.icanig.org

International Journal of Contemporary Accounting Issues-IJCAI (formerly International Journal of Accounting & Finance IJAF), 2020, vol. 09, issue 1, 18-46

Abstract: The performance of the manufacturing sector in Nigeria in recent times has been unsatisfactory. There have thus been calls for research into strategies that can revamp the performance of companies operating in the sector. Since customer accounting has been put forward as a strategically oriented management accounting technique linked with competitive advantage, this study investigated whether or not the use of Customer Accounting Technique (CAT) can create and sustain competitive advantage in the medium- to long- term in the Nigerian manufacturing sector. Data obtained from the annual reports of fifty-six (56) manufacturing companies quoted on the mainboard of the Nigerian Stock Exchange (NSE) covering a 10-year period (2008-2017) were analyzed using descriptive statistics and independent sample t-test. It was discovered that the most popular form of customer accounting practice among companies is the tracking of revenue, cost & profit per customer. Whereas the frequency of high-users of CAT was less than those of low- users, the usage rate of CAT was noted to be generally average. It appears the intense usage of CAT can create and sustain competitive advantage in the dimensions of profitability, market share and customer patronage. However, the study found no evidence to support the supposition that the deployment of CAT can sustain shareholders' value creation. Following empirical finding from this study that customer accounting is a source of sustainable competitive advantage, organisations seeking strategies to improve their competitiveness may consider the extensive application of CAT to gain and sustain competitive advantage, especially in the enhancement of profitability, market share and customer patronage.

Keywords: competitive advantage; customer accounting; market orientation; strategic management accounting; sustainable competitive advantage (search for similar items in EconPapers)
Date: 2020
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International Journal of Contemporary Accounting Issues-IJCAI (formerly International Journal of Accounting & Finance IJAF) is currently edited by Ijoema Anasa and Ochuko Jeff Odesa

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